Intelligent Invoice Recognition: What and Why

When organizations think of automating Accounts Payable and Invoice Management (AP/IM), the front end of the process is commonly referred to as invoice capture and gets a lot of attention. Why do businesses pay such great attention to invoice capture? The answer resides in the broad range of meanings encompassed in the term “invoice capture” and the organizational impacts of these meanings.

What Is Invoice Capture?

Let’s dig deeper into the potential meanings of invoice capture: Does it mean casting a wide net consolidating all of the various forms of incoming invoices into the same boat? Does it mean transforming the many forms of invoices, once in the same net, into a consistent format for effective storing and searching? Does it mean recognizing and extracting both the high level and line item detailed data (this is often referred to as Intelligent Capture Recognition or ICR)? Does it mean connecting that data with a financial and/or back-office business process? The simple answer is yes to all of the above as the components of invoice capture are: Invoice Consolidation & Transformation; Invoice Recognition & Data Extraction; and, Connection to Business Processes. Most modern AP/IM automation systems comprise functions to manage the above components with major emphasis given to invoice recognition & data extraction.

If you are not using an automated system/solution, you use some combination of manual processes, manual procedures and tools to manage your AP/IM process. Even here, a lion’s share of your time and resources are allocated to invoice recognition & data extraction. AP clerks still spend hundreds of hours to re-write/re-enter the main requisites of an invoice from paper to an informational system. Accuracy and appropriate data entry are paramount. All rules and automated validations of invoice approval following invoice recognition & data extraction will somehow rely on these main requisites (sum of the amount on the invoice, related purchase order, line item details, and more).

Daniel Shields

Wrong data will lead to wrong solutions and can make the overall approval and payment process longer…and more costly. That is why it is very attractive to automate routine invoice capture procedures, as well as the extraction of data, to enable the AP clerks to control the results of data entry and recognition.

Invoice form recognition solutions with impressive sets of options based on complicated algorithms of image and form recognition can sufficiently reduce data entry costs and alleviate AP clerks of data entry and matching. These leads to the main topic of this article: “What does invoice capture mean to your organization and can these automated solutions guarantee benefit to any AP department in any organization?”

Why Automate Invoice Recognition?

We often participate with our customers in discussing the effects of implementing such automated functionality. Many of them prefer to use only scanner, without ICR, to capture invoices and to enter data manually. The detailed line item data of an invoice used to execute internal business rules, like matching to purchase orders or contracts, is not so important.

There are challenges to this automated functionality:

100% of invoices require final review; 90% of invoices require adding or correcting attribute values; and, 40-50% of invoices require manual data entry. It turns out that many organizations may not achieve payback from rather expensive recognition modules.

What’s the Use?

How does your organization evaluate the use of this automated functionality? The following recommendations will be of interest for the organizations planning to implement an automated invoice capture solution as well as a complete AP/IM solution:



Orienge is an experienced Enterprise Content Management provider. Conterra FIM is one of our leading business solutions that helps companies manage their AP/IM process. We have basic Conterra FIM options that do not include intelligent invoice recognition and options that do include such functionality.

As with all Conterra solutions, the ECM platform that manages the Conterra FIM business solution is ready to help manage all of your information management challenges!