Yeah, I know, I missed Thursday. Had to take care of some critical things at my end.
Let’s get to individual processes now. First on the list is Invoice processing. You may ask, why I pick up invoice processing, though this component is not the start point of the process? Fundamentally because this is the most outsourced function and the first to be picked up.
Invoice processing simply implies making an accounting entry for a vendor / expense invoice. It looks so simple, but the complexity arises as the volumes grow. You know that companies can spend as much as about $10- $15 per invoice. Surprised? The cost comes from the cost of the ERP system, number of licenses, the cost of employees, supervisors and managers involved, the cost of technology, the cost of hiring, the allocated cost of other support functions and so on and so forth. A good cost can be around $3 per invoice.
A lot of this cost is generated due to the financial policies in place. There will be business rules which will define who and how the payments will be approved, or even due to the requirements of making the expense.
There could be different modes, which will lead to various levels of verification and validation. These could vary on the value of the transaction as well.
More on IFRS exceptions, business combinations: https://faoblog.com/ifrs/ifrs-exceptions-business-combinations-part-2/