Processing purchase invoices: a complete guide for firms

What does processing purchase invoices involve?

Processing purchase invoices means turning supplier invoices into correct entries in the accounts payable ledger, including the link to the payment. An invoice is only truly processed once it sits on the right GL account and VAT code, the input VAT is correct and the payment has been reconciled. Until then there is an open item that may no longer exist, or a bank payment nobody can explain.

For a firm this is the largest volume process in pre-accounting. Every client has its own suppliers, its own chart of accounts and sometimes its own agreements on approvals and cost centres. That is why it pays to describe the process in fixed steps, so everyone in the team works the same way and you can decide per step what software may take over. For almost every firm the chain looks like this:

1. 1Intake: the invoice arrives via upload, email, app, WhatsApp, portal or a connected source.
2. 2Recognise: supplier, invoice date, invoice number, amounts, VAT and lines are read.
3. 3Code: each line gets a GL account, VAT code and, where needed, a cost centre or project.
4. 4Check: duplicate invoices, VAT calculation, VAT number, IBAN and payment terms are checked.
5. 5Approve: where the client wants it, someone approves the invoice before or after booking.
6. 6Book: the entry is recorded in the administration's accounting software.
7. 7Pay and match: the payment is linked to the open item and reconciled.

Through which channels do purchase invoices arrive?

At most firms purchase invoices arrive through several channels at once: by email, as uploads, via an app, as a photo in a messaging service or directly from a portal or the accounting software. Suppliers send invoices to the address the client gives them, and clients forward them in whatever way is easiest for them. The risk is that invoices get scattered across mailboxes, folders and chats and only surface at month-end.

The answer is not to force clients onto one channel, but to make every channel end up in one place per administration. Give each administration its own purchase email address that suppliers can send to directly, for example, and make sure photos and uploads land in the same inbox. Agree which channel is meant for which document type, so sales invoices and receipts do not get mixed up either. Commonly used channels are:

• Upload by the firm or the client, including bulk drag-and-drop.
• A fixed purchase email address per administration, or a connected mailbox such as Gmail or Outlook.
• A client app for iOS and Android to photograph receipts and invoices.
• WhatsApp for receipts that come up on the go.
• A client portal where the client delivers documents and sees what is still outstanding.
• A digital mailbox in the accounting software, such as the one in Exact Online.

How do you code and check a purchase invoice?

You code a purchase invoice by determining the supplier, GL account, VAT code and, where needed, cost centre or project for each line, and then check that amounts, VAT and payment details are correct. Take an invoice of €1,210 for office supplies with 21% VAT. The entry is €1,000 debit on the office expenses account, €210 debit on recoverable VAT, and €1,210 credit on accounts payable. The €210 reappears in the Dutch VAT return as input VAT in box 5b.

Checks belong with coding, not at the end of the month. An invoice that arrives twice, first by email and later as a photo, otherwise produces a double expense and double input VAT. A VAT amount that does not match the rate, a VAT number that does not exist or an IBAN that differs from earlier invoices of the same supplier are signals you want to see before anything is booked or paid. The key checks are:

• Duplicate invoice: the same invoice number, amount and supplier already exist.
• Arithmetic check: subtotal, VAT and total add up.
• VAT code: the rate fits the supplier and the type of cost, including reverse-charge VAT.
• VAT number: checked via VIES for foreign suppliers.
• IBAN: the account number matches what is known for the supplier.
• Payment terms: the due date has been recorded correctly.

What is the difference between manual, scan-and-recognise and AI?

The difference lies in who does the reading and coding, and how much setup that takes. With manual processing, an employee types all the data over from the PDF and looks up the GL account and VAT code themselves. That is flexible but slow, and quality depends on who is booking. With scan-and-recognise, OCR turns the invoice into text and templates or supplier settings fill in the fields.

Template-based scan-and-recognise works well as long as suppliers and layouts stay the same. A new supplier, a changed invoice layout or an unusual line then requires maintenance or manual work. AI recognition looks at the content and context of the invoice and at the history of the administration, so unfamiliar layouts are recognised too. The AI produces a proposal with a confidence score, and the firm uses a threshold to decide what is booked automatically and what a person sees first.

• Manual: no setup, but a lot of typing and variable quality.
• Template-based scan-and-recognise: fast for regular suppliers, maintenance with every change.
• AI recognition: no templates, proposals based on history, control through confidence score and threshold.

How do you set up a firm workflow for purchase invoices?

You set up a firm workflow by recording for each step who does what, which checks apply and when something may go through automatically. Start with the firm standard: how do you book till receipts, credit notes and multi-category suppliers, and which amounts must always be seen by a person? Record those agreements as firm-wide rules, and only the deviations as rules per administration. That way the working method stays the same, even when another colleague takes over an administration.

Next, decide per client whether invoices are approved first and then booked, or booked first and checked afterwards. Clients whose management wants to see every large expense suit approval before booking; for small business owners a check afterwards is often enough. Also agree who makes the payment, usually the client in their banking environment or via the accounting software, and how the payment is reconciled afterwards. A practical order for the setup:

1. 1Bring the intake channels for each administration back to one inbox, with its own purchase email address.
2. 2Record firm-wide booking agreements and note only the exceptions per client.
3. 3Choose approval before or after booking per administration, and who approves each step.
4. 4Set a threshold for automatic booking, and start cautiously with proposals only.
5. 5Agree how missing information is requested from the client and followed up.
6. 6Match payments daily or weekly so open items stay up to date.

How does Autoboeker process purchase invoices?

Autoboeker processes purchase invoices without templates, on top of Exact Online, Twinfield, SnelStart and e-Boekhouden. Invoices arrive via upload, a purchase email address per administration, the client app, WhatsApp, Connect (including Gmail, Outlook and cloud storage) or the Exact digital mailbox; for SnelStart administrations, documents are fetched from SnelStart. The AI recognises supplier, date, invoice number, amounts, lines, VAT, GL account, cost centre and optionally project, recalculates subtotal, VAT and total, checks VAT numbers via VIES and IBANs, and flags duplicate invoices.

Every proposal gets a confidence score and an explanation. Above the threshold you set per firm or administration, it is booked straight into the software; below it, the proposal waits for review. With approvals you set per administration whether invoices are approved before or after booking, in one or more steps. If information is missing, a client question goes to the client. AI bank matching with automatic reconciliation is available for Exact Online, Twinfield and SnelStart; bank matching is not available for e-Boekhouden.