Dr. Alok Aggarwal
CEO and Chief Data Scientist
Scry Analytics, California, USA
Office: +1 408 872 1078; Mobile: +1 914 980 4717
October 26, 2020
Around 13 billion invoices were sent in the United States in 2019 from businesses to each other and to government agencies. To remit these invoices, firms primarily used manual labor to extract and reconcile relevant fields, which cost them around 2% of invoice value and 25-30 minutes of accountants’ time. Despite this cost, most firms were unable to analyze these invoices in detail and some ended up overpaying their suppliers or continue to pay for products and services they no longer used. This article discusses an AI-enabled software from Scry Analytics, Collatio®- Invoice Reconciliation, which extracts and reconciles relevant data with more than 93% accuracy from invoices, purchase orders and related agreements, and provides insights and decision support for reducing overpayments.
According to industry estimates, in 2019, around 13 billion invoices were sent in the United States from businesses to each other and to government agencies [1,2,3]. Since the corresponding sales were approximately ten trillion Dollars [4,5], the cost of an average invoice was around $770. To pay their suppliers, almost all account payables’ groups conform to the following process:
In addition to the above-mentioned disadvantages, given below are three drawbacks of this process:
All direct and indirect costs mentioned above often end up being around 4% of the total invoice-value, and saving even half of these costs, is likely to improve profit margins for most firms. In fact, organizations that spend one-quarter to half of their revenue on external suppliers, can witness their profit margins increase by 5% – 10%. Also, a speedier handling of these invoices will help in improving the financial health of suppliers, thereby cementing better relationships with them .
Collatio® – Invoice Reconciliation software from Scry Analytics (www.scryanalytics.ai) uses proprietary AI-based algorithms and automates the invoice reconciliation process thereby reducing the drudgery of manual reconciliation while ensuring accuracy in payments with minimal errors. It consists of four software modules that are discussed below:
Finally, since more than 80% all invoices are received by small and medium-sized businesses (SMBs), who have limited funding for capital expenses , Collatio® – Invoice Reconciliation software is sold in SaaS (software as a service) mode but can be also installed behind the information technology firewall.