Simplify Vendor Invoicing and Stay Top of Spend with Our Free Invoice Policy Template

Simple, accurate vendor invoicing is critical to your business’ ability to manage spend.  

Unfortunately, there are many errors that can happen along the way – from unauthorised and double payments to matching errors, data entry errors, payment delays, and payments made prior to receipt. Not only can these errors damage vendor relationships, they can hurt your bottom line. 

A strong vendor invoice policy helps avoid these pitfalls by allowing you to evaluate vendor invoices for compliance with your company’s policy rules.  

While creating a vendor invoice policy may take some time upfront, the benefits are well worth it. In addition to speeding up vendor invoice approvals and processing, it will make it easier for your accounts payable (AP) team to address exceptions and manage documentation.  

To help you get started, the invoice management experts at SAP have some good advice: 

Crafting a solid vendor invoice policy requires collaboration – so be sure to find out what the various teams across your business need. Not only will this help ensure you cover all the bases, it will help drive adoption once your policy is complete. 

Next, consider how you work with vendors. What is working well and what could be more efficient? Reach out to your vendors to see if there are ways you could standardise invoice processes – for example, by requiring invoice submission by e-mail and payment by ACH or purchasing card. 

When your first draft is ready, pass it back around to the teams you worked with up front. Make sure the steps are clear and the policy meets their needs. If there is confusion or concern, continue to rework the policy draft until everyone is on the same page. Remember, the easier a policy is to understand, the easier it is to follow and enforce. 

Once your vendor invoice policy is final, have a plan for rolling it out. The first step is making sure it’s easy to find. A policy document that’s buried in a sea of clicks is of no use to anyone. E-mail the new or updated policy to everyone and consider having everyone e-sign to ensure receipt. Also make sure that someone is available to respond to questions. And if new processes are involved, have a change management plan for those as well. 

Finally, use the opportunity of creating or updating your vendor invoice policy to examine ways that technology can help your invoice management run smarter. For example, could data entry, document storage, workflows, and auditing processes be automated to save time, improve accuracy, increase visibility, and reduce the risk of noncompliance and fraud? Would mobile access make life easier for your employees – giving them and your business greater flexibility in how work gets done? 

If you still feel like creating a vendor invoice policy seems like a dauting task – don’t worry. The team at SAP is again here to help with a free vendor invoice policy template. 

The template includes a detailed explanation of the basic components recommended for any vendor invoice policy as well as sample language that can be edited to align with your company’s specific policies and processes.  

At its simplest, your vendor invoice policy should cover the following: 

• Statement of purpose: Explain why you need a vendor invoice policy, whom it applies to, and basic guidelines. Be sure to include the benefits of having a policy for employees, vendors, and the business.  

• Company expectations and policy compliance: Clarify the responsibilities of each employee when dealing with vendor invoices; rules for managing documents; policies and procedures for reviewing, coding, and approving invoices; and consequences for noncompliance.  

• Delegation of authority, approval chains, and purchase price variance: Address common areas of confusion, such as who can approve invoices, the rules for purchase price variances, and who can approve exceptions. 

• Periodic review: Ensure your vendor invoice policy is always up to date. Be sure to include instructions for periodic reviews of the policy with a clear designation of the role(s) and department(s) responsible for carrying them out. 

• Subject areas: Detail the nuts and bolts of your vendor invoice policy. Be sure to cover everything from where invoices should be sent to how to record receipts, code and send invoices to AP, manage approvals, manage exceptions, store and access documents, and any other related policies and procedures.  

Check out the complete vendor invoice policy template to find out more about what the right vendor invoice policy can do for your business. As you do, be sure to ask yourself how the right invoice management technology can empower your people by making that policy simpler and more effective for your entire business. 

Then visit us at www.concur.com.au to get started.