Is Straight Through Processing the Answer

Is Straight Through Processing the Answer

Efficient Accounts Payable Processing?

Why automate?

The Financial Controller at a leading organisation walked into her Accounts Payable department to discover they were struggling to process invoices, even with a supposedly automated solution.  She started to investigate alternative solutions and thought that maybe one of the key areas would be around how to maximize straight-through processing.

But what is Straight Through Processing and what does that mean?

And is this the right question

We are always asked, what is your recognition rate, how many invoices will go straight through?

Is this relevant and what factors really impact on the ability to achieve this?

Straight-through processing means that when an invoice is received by an organisation, it goes directly into their ERP platform for payment without any intervention. How is this achieved

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Below are some key factors that impact on the ability to enable straight through processing;

Arcivate Mi Invoices - Automated Invoice Processing into Oracle EBS, ERP Cloud, JDE and PeopleSoft

item-styleThe first question is what is your percentage of PO, (Purchase Order) to Non-PO as this is the highest match rate achievable.


You need consider that 100% is never achievable as certain invoices such as utility bills do not require a PO to send you an invoice.

item-styleThen we hear from customers – “Yes, we are 100% PO but typically we raise the PO after the invoice arrives, (Retrospective Purchase orders)! Once we receive the invoice, then we receipt the goods.” 


The next question is how many of your invoices match 1st time without manual intervention?


How good and timely is your Goods Receipt Note (GRN)  process?

Typically this highly dependent on your industry, is your organisation working to Just in Time  ( JIT ) and the goods are receipted by your goods in department or do your project teams undertake this once a week? Or even does it take several weeks for the goods to reach their destination, before the project team can apply the GRN!


Do you need to match your invoices at Line level or at Header?


That’s before we get to the thorny questions, how good are your suppliers at invoicing correctly and critically how good is your master data!

Matching the extracted data to the Supplier Master Data held within the client’s ERP is the next step. If everything matches, it is within tolerance, and correct, the invoice can then pass straight-through to the ERP without any human intervention. 

Taking into account all these points is straight-through processing the answer and what does that mean?

See our Oracle blog, for the critical pillars of automated invoice processing into Oracle ERP platforms                                                                              Intelligent Invoice Processing Blog


Is Straight Through Processing really possible?

Analysing the reports to see the business unit data and the efficiencies and savings of the new process


We are left with the obvious statement, that 100% straight through processing is rarely possible and manual intervention is inevitably going to be necessary.

Critically the actual question which should be asked of a supplier’s system;

How simple is it to process the exceptions with the minimal amount of time and effort?

This is the real area you need to focus on when looking at solutions to automate your invoice processing. Not the simple question “what is your recognition rate to enable straight through processing.”

You can also have a major effect on the required  processing time and effort by reviewing your master data and undertaking a data cleansing activity. Including the removal of redundant suppliers and to ensure your current supplier address details are complete!   



So what functions and capabilities are needed and what can you do to to maximise efficiency?

Critical areas you need to focus on are;

item-styleComplete Integration with your ERP platform to extract the required master data, which can be used to automatically validate the Invoice.Mi Invoices automated process flow and integration with Oracle ERP platforms


A simple user friendly interface, to minimise the number of key strokes and mouse clicks to process the invoices. This also aids acceptance and reduces training needs.

item-styleThe purchase order data needs to be complete, to assist in receiving accurate vendor invoices and created before the invoice is sent to you.

item-styleThe platform needs to simplify the process for the AP team to route the exceptions to required users for resolution and approval. This should also apply to rejections whether back to a supplier or to a user.


Once all of the data is corrected and validated, the invoice is submitted into the ERP platform for onward processing. This should be achieved by tight integration that can dynamically push the invoice directly into approved ERP interfaces. Ideally this should be for each invoice,  as a flat file with a batch of invoices will fail if there is an error on any single invoice.


Want to see how this is possible?  Book a live demonstrationBook a Demo

For more information on Invoice Automation please see:

AP Invoice Automation in the Cloud Mi Invoices

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See what SaaS Invoice Automation can do for you

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