Developing invoice approval process: guidebook for second approvers : the case of Company X
Sinisaari, Sara (2020)
Sinisaari, Sara
2020
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2020120927202
https://urn.fi/URN:NBN:fi:amk-2020120927202
Tiivistelmä
Accounts payable (A/P) is the business function where invoices are most often processed. An important part of the process is the invoice approval process where the legitimacy and accuracy of each invoice is verified, meaning that the quantity and quality of the received products or services match what was agreed with vendor. Company X had noticed that the approval process of Client Y invoices is not as efficient as it could be. As thesis objective was set to improve the invoice approval process efficiency by increasing second approvers’ knowledge about the process, best practices and terminology related to it. The purpose of the thesis was to create a written guidebook for the second approvers of Client Y. The thesis focused on finding answer to research question “What information could second approvers need in order to avoid mistakes and the invoice approval process to be as clear as possible?”.
The main research methods used in this thesis were interviewing and document analysis. In total two interviews were conducted during the research process, one with Company X A/P professional and one with Company X accounting expert. Documents that were analysed were invoices and credit notes that had approval, override approval or rejection notes left by any of three approvers. Additionally, participant observations prior and during the research were taken into account.
The interviews and document analysis revealed that the approvers need guidance in giving the right invoicing information, in which situation is the best practice to approve a document and when to reject, which items should be checked every time from invoice and booking before giving approval, how invoices to be split or forward invoiced should be handled, and how often the awaiting documents should be approved. With instructions about these topics in the guidebook, the approval process should become more efficient as the number of unnecessary rejections should decrease and small mistakes in bookings should be noticed and corrected earlier.
Based on the research findings and literature review, a written guidebook for the Client Y second approvers was created. For confidentiality reasons the guidebook has been removed from the appendices of the public report. Further research could be undertaken to investigate the effects that the approval guidebook has on the approval process efficiency in reality.
The main research methods used in this thesis were interviewing and document analysis. In total two interviews were conducted during the research process, one with Company X A/P professional and one with Company X accounting expert. Documents that were analysed were invoices and credit notes that had approval, override approval or rejection notes left by any of three approvers. Additionally, participant observations prior and during the research were taken into account.
The interviews and document analysis revealed that the approvers need guidance in giving the right invoicing information, in which situation is the best practice to approve a document and when to reject, which items should be checked every time from invoice and booking before giving approval, how invoices to be split or forward invoiced should be handled, and how often the awaiting documents should be approved. With instructions about these topics in the guidebook, the approval process should become more efficient as the number of unnecessary rejections should decrease and small mistakes in bookings should be noticed and corrected earlier.
Based on the research findings and literature review, a written guidebook for the Client Y second approvers was created. For confidentiality reasons the guidebook has been removed from the appendices of the public report. Further research could be undertaken to investigate the effects that the approval guidebook has on the approval process efficiency in reality.