Accounts PAyAble

Accounts Payable Services A strong foundation for sustained benefits

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CFOs expect more from the AP func-tion. AP, long regarded as a back- office cost center, is now evolving into a strategic business enabler charged with the mission to reduce costs, strengthen compliance and controls, ensure accurate and timely reporting of payments, partner with procure-ment, receiving and business units to streamline the procure-to-pay process and add value through more strategic payables-related working capital.

To accomplish this mission, the AP function must streamline the invoice process, update or implement new technology and, like other parts of the organization, implement success-ful strategies such as outsourcing non-strategic work, leveraging P-Cards for low-value high-frequency transactions and migrating from paper to digital workflow.

The accounts payable (AP) function is changing. For the past decade, finance departments have focused on driving cost, complexity, risk and error from their routine transaction processes. Streamlined business processes, often com-bined with improved technology systems, have largely been the basis of these efforts. The re-sulting improvements often are viewed through an efficiency lens: more invoices processed with shorter cycle times, fewer employee hours and greater  accuracy.

Introduction

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Today’s AP challenges

In most organizations the majority of non-purchase order invoices and T&E reports still enter the process in paper or paper-equivalent form. From re-ceipt to payment, manual touch points are required to convert and validate data, to complete approval through the purchase order and non-purchase order process and to remit payment.

Staff is inundated with manual data entry, duplicate invoice copies and re-quests for special payments, non-stop calls for payment from suppliers and staff and paper recordkeeping.

Moreover, decentralized receipt and manual routing prolong payment time so that a substantial number of invoices cannot be paid on time. Discounts are lost. Late fees are incurred.

The accrual of outstanding liability is guesswork at a time when the CFO and CEO are required to endorse for the accuracy and integrity of financial re-porting under the Sarbanes-Oxley Act.

On the strategic front, there is insuffi-cient time and staff to work on process improvements and implement auto-mation. Resource limitations hinder work to align procurement and AP practices to ensure payments are made within contract terms, exceptions are minimized and discounts and rebates are realized.

At the operating level, AP managers are pressured by management to reduce the total cost of AP, even as business units demand more analytical sup-port, suppliers want faster payment and procurement seeks an integrated

procure-to-pay (P2P) process and in-ternal audit mandates for fewer errors and tighter controls.

Finally, while all organizations use tech-nology, the technology they have is not designed to eliminate the manual work of processing invoices and T&E claims. Most organizations operate multiple ERP systems with or without invoice workflow. Manual labor is required to enter data, to work with separate ERPs and to secure approval and exceptions outside ERP. The use of scanning and digital content management technol-ogy is becoming more prevalent. How-ever, most organizations still do not use automation to capture, validate and match data, or for approval collection.

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INVOICE INTAKE

Receive

Centralizedpaper, digital

Scan

Intelligent capture extraction

REJECTED INVOICES RETURNED TO SUPPLIER

AP SUPPORT

Help desk for vendor inquiriesVendor maintenance

ReconciliationsCompliance and AP records management

Month-end, year-end routines – Accruals1099, Tax

Reports and ad hoc analyses/special projects

Validate

Automatedbusiness rules

Approve

Automated workfl owPO, Non-PO

INVOICE PROCESSING

canon Accounts Payable Service Process

canon’s AP service is scalable and can be implemented step by step to add the right level of enhancement that makes sense for your process.

comprehensive, customized, modular and Flexible AP Service

canon business Process Services provides a comprehensive accounts payable service that can help the AP function escape the laborious work of processing invoices and free up the budget and time to work on more important, value-added work.

canon’s AP service covers the entire in-voice lifecycle from receipt to payment. we provide the technology, people and facilities to process invoices and T&E claims. we can hire your staff and pro-vide the services onsite or provide the services in our facilities. we integrate our technology with yours to optimize the AP invoice workfl ow end to end.

INVOICE PAYMENT

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/1 InvoIcE InTAkE centralizes the receipt, scans and converts paper or digital in-voices into data and images that are routed to your ERP, AP workflow and content management systems. All data, including line-item detail, is captured for validation later on. Manual data en-try is replaced with intelligent capture, which should reach more than 95% ac-curacy and reduce labor cost by up to half. Images are indexed for easy search and link to ERP. Paper invoices do not enter the workflow.

/2 InvoIcE ProcESSIng validates the in-voice and completes the approval pro-cess, whether it is a purchase order or non-purchase order invoice. Automated, rules-based workflow matches the data captured from invoices against the data in the master files, such as ERP, vendor master, purchase order system, paid in-voices, etc. The output is valid invoices set up in ERP. Invalid ones are returned to the vendor. Approval is completed using staff assisted by automated matching and workflow. Approval time may be reduced from weeks to days.

/3 InvoIcE PAymEnT services may include both electronic and check payments. Canon staff reviews payment file and presents to client for final release. We manage bank payment files and recon-ciliation.

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/4 AP SuPPorT SErvIcES include vendor maintenance and inquiry help desk, maintenance of AP records, reconcilia-tion and analysis, reporting, maintain-ing policy, procedures and internal controls, administering programs such as P-Card, regulatory compliance for T&E, IRS reporting, tax and month-end and year-end routines such as accruals and 1099s.

/5 FlExIblE dElIvEry oPTIonS Canon AP services can be provided at the client site, through the Canon business processing centers in the U.S. and offshore or in combination to meet business requirements. The service can be implemented in a modular step-by- step process. For example, start with in-voice intake, which provides significant improvements quickly. Then, advance to processing services offshore. With slight modification, our technology platform, which includes scanning, workflow and ECM, can be leveraged for other processes to provide even more value.

/6 STrEAmlInIng ThE InvoIcE ProcESS To rEducE cyclE TImE And coSTThe policies, procedures and discipline in procurement and receiving drive the number of exceptions in the invoice process. That’s why when working to streamline the invoice process, Canon experts begin with the procure-to-pay (P2P) process. We can centralize the receipt of paper invoices and scan-ning either at our facilities or yours. We can integrate the invoice process with P2P systems. Before entering the invoice in your ERP, we interrogate each invoice against your master data, which we exchange nightly. Only valid invoices enter ERP, greatly reducing the work associated with duplicate or invalid invoices. For non-PO invoices, we leverage digital workflow to col-lect approval and track status. For PO invoices, we leverage line-item match-ing technology to speed approval and reduce errors. It all adds up to having the ability to pay invoices on time and maximize discounts.

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/7 uSIng AuTomATIon To rEducE ErrorS, ImProvE ProducTIvITy And lowEr coSTOpen standard and scalable, the Canon invoice automation platform can be in-tegrated with virtually any ERP, ECM or P2P system. Automating capture, data conversion, validation, matching and workflow reduces the invoice pro-cessing time to days. Productivity may increase from 1,000 to 10,000 invoices per FTE per month.

/8 uSIng AuTomATIon To ImProvE comPlIAncECompliance with business and regu-latory requirements such as the Sarbanes-Oxley Act is necessary and important. The Canon AP solution of-fers consistent workflow processes that help maintain accurate records. By overcoming gaps in tracking, accessing and updating data, the system can help improve client compliance.

Effective accounts payable processing is essential for every organization. with canon, you can achieve significantly el-evated AP performance without invest-ment in technology. At the same time, you can significantly reduce the total cost of AP processing and strengthen controls with a consistent metrics and business-rules-driven process.

To learn more about how canon business Process Services can improve your accounts payable process, call us at 1-888-623-2668 or visit www.cbps.canon.com

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client Experiences using canon AP Services

Invoice intake.A European cosmetics manufacturer implemented an automated invoice processing workfl ow globally. The company’s U.S. operations receive approximately 20,000 paper invoices per month. Management asked Canon to centralize receipt, scan, convert the data and upload it into their new workfl ow. Using Canon Business Process Services BPO facilities and AP platform, we implemented the receipt process via USPS PO box, fax, email and FTP addresses.

We implemented the scan and OCR process, capturing even line-item detail. Then, we went one step further. Using nightly fi le exchange, we implemented invoice validation so we can check and prevent invalid duplicate invoices from entering the process. Invalid invoices are rejected and sent to the supplier managers. The client never sees paper invoices.

20kInvoices processed monthly

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AP processing.  A leading pharmaceutical company, receiving 15,000 invoices a month, implemented a new invoice imaging and workfl ow system, feeding Oracle ERP, to speed up invoice processing and reduce costs. Unexpected results were encountered. The number of on-time invoice payments dropped from 40% to 5%. The cost per invoice was in the $20 range.

Canon was brought in to do a root cause analysis and turn around the

situation. Subsequently, the cli-ent outsourced the 18-person AP department to Canon. Canon streamlined the invoice process using Six Sigma process expertise and immediately reduced staff by 20% and the cycle time from eight days to three. In phase two, the capture and pro cessing workfl ow automation will be implemented correctly along with offshore pro-cessing. The average cycle time and cost will be reduced further.

AP and P2P integration. A regional bank receiving 20,000 in-voices per month using a P2P system for PO invoices wanted to reduce the cost and cycle time of processing 10,000 non-PO invoices and also join the non-PO invoices with the P2P system. Canon integrated front-end capture to the P2P system with au-tomated validation workfl ow to pre-vent duplicate invoices from enter-ing the system. Invoice receipt and

data conversion were centralized in the Canon BPO center as well as processing of invoices locally. The number of invoices reaching on-time payment increased from 40% to 80%. All invoices are processed in one paperless P2P system.

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80%

number of days’ average receipt until ready to pay

of invoices paid on time

© 2017 Canon Business Process Services, Inc. All rights reserved.

Advancing business Performanceto a higher level

Canon Business Process Services, a wholly owned subsidiary of Canon U.S.A., offers managed services and technology for information and document management, business process outsourcing and specialty workforce services. We help clients improve operational performance while reducing cost and risk. Canon Business Process Services has been named a Global Outsourcing 100 Leader by IAOP for the past eleven years and recognized in the Gartner Magic Quadrant for Managed Print and Content Services for five consecutive years. We have also been acknowledged by CIOReview magazine as a "20 Most Promising Legal Technology Solution Provider."

Learn more at cbps.canon.com and follow us on Twitter @CanonBPO.

1–888–623–2668

Canon Business Process Services, Inc. | Accounts Payable