Purchase-to-Pay and Invoice Automation

Approval routing: Designated route for order request or invoice to receive approval from.

Approval workflow: Workflow configuration into the purchase-to-pay application that enable automatic routing of orders and invoices to the financial or business authorizers required to approve an order or invoice before it is placed or paid.

Blanket PO: Blanket purchase orders are available to departments when there is a need to repetitively purchase miscellaneous supply items from a single vendor. A blanket purchase order is issued for a specific dollar amount. When the encumbered dollars have been used, a new requisition must be processed to reestablish the blanket order for further purchases.

Discrepancy: The result of an invoice, purchase order or receiving document not matching or being outside a preset tolerance level.

Electronic Data Interchange (EDI): A standard format for exchanging business data between computer systems.

eInvoicing: The transmission of invoices from suppliers in electronic formats such as cXML or EDI.

eProcurement: The purchase and sale of supplies, work and services through the Internet as well as other information and networking systems.

Escalation: Sending an order request or invoice to another user for resolution when the original user has not responded for a certain period of time.

Enterprise Resource Planning systems (ERP) – Multi-module application software that helps a business manage product planning, parts purchasing, maintaining inventories, interacting with suppliers, providing customer service and tracking orders.

Hosted catalog: Supplier catalogs of goods or services that are managed in a purchase-to-pay system. Verian’s products standardize product information for easy online searching, price comparison and ordering across vendors.

Invoice from purchase order: Invoice created after the supplier receives a PO from the buyer (see non-PO invoice).

Invoice matching (two-way, three-way and four-way): Two-way matching refers to matching an invoice to its corresponding purchase order. Three-way matching refers to matching an invoice to a purchase order and the goods receipt note. Four-way matching adds a visual inspection to ensure the good received match the quantity ordered.

Non PO-invoice: Invoice generated on the supplier side without the creation of a PO from the buyer (see PO invoice).

OBO: On behalf of.

Optical character recognition (OCR): The electronic translation of images of handwritten, typewritten or printed text (usually captured by a scanner) into machine-editable text.

OR: Order request.

Permissions: System authorizations given based on user or group.

PO: Purchase Order. A purchase order is a commercial document issued by a buyer to a seller, indicating the type, quantities and agreed prices for products or services that the seller will provide to the buyer.

Punch out: A software application that makes it possible for a buyer to access a supplier’s Web site electronically. The buyer leaves or “punches out” from their purchasing application and goes to the supplier’s Web-based catalog to locate and order products, while their application transparently maintains connection with the Web site and gathers pertinent information.

Request for quotation (RFQ): A standard business process where suppliers are invited into a bidding process to bid on specific products or services. An RFQ typically involves more than the price per item. Information like payment terms, quality level per item or contract length are possible to be requested during the bidding process.

Requisition: A written order or a formal demand by the user(s) of a good or service to the organization’s purchasing department. It generally includes the brand and model name or number, description, quantity, and the required delivery date. Also called purchase requisition.

Rule: Custom settings based on an organization’s operational needs (ex. Allowing only certain users to view a vendor’s entire catalog, while restricting all other users)

Rule chain: A series of rules configured in a purchasing application to produce predetermined outcomes.

SKU (Stock-keeping unit):  A unique identifier for each of the distinct products and services that can be ordered from a supplier, or stored in an application.

Standing order: Setting in a purchasing application to order a set amount of an item at regular intervals from a vendor. They are typically used to pay rent or other fixed regular payments.

Suppliers: Also called a vendor, a supplier is anyone who provides goods or services to a company.

Purchase-to-Pay (or P-2-P): The term used to describe using Internet based technology to automate the requisition, approval, receipt and payment of goods and services. It enables buyers and suppliers to take advantage of technology such as eProcurement and eInvoicing to make the buying and supplying processes more cost and time efficient.

XML- eXtensible Mark-up Language: A language used to create syntaxes used as an international standard for passing data between applications, particularly those that communicate across the Internet.