Streamline AP Processes with Invoice Capture for Dynamics 365 Finance

Manual invoice processing is one of the most time-consuming and error-prone tasks in the accounts payable (AP) department. From managing paper invoices to chasing down approvals and rekeying data, traditional workflows often lead to delays, duplicate payments, and compliance risks.

Fortunately, Microsoft Dynamics 365 Finance offers integrated invoice capture solutions that help organizations modernize their AP process. Whether you're dealing with hundreds or thousands of invoices each month, automating invoice capture can significantly reduce costs and increase efficiency.

What Is Invoice Capture?

Invoice capture refers to the process of automatically extracting key data from supplier invoices, such as vendor name, invoice number, date, amount, and line items, and entering it into your financial system. Advanced invoice capture solutions use OCR (Optical Character Recognition) and AI-driven data recognition to pull information from paper, PDF, and digital invoices with high accuracy.

In the context of Dynamics 365 Finance, invoice capture can be integrated directly into your existing workflows, allowing seamless invoice processing from receipt to payment.

Does Microsoft Dynamics Have OCR?

Yes, Microsoft Dynamics 365 Finance offers OCR capabilities through its Dynamics 365 Invoice Capture solution, which leverages AI Builder and Microsoft Power Automate. This functionality allows users to automatically scan and extract data from invoices using machine learning and OCR technologies. The solution is designed to identify key fields like invoice number, vendor details, total amounts, and dates—even when the layout varies from one supplier to another. For businesses that require more robust or specialized OCR features, integrations with third-party tools like Kofax, Medius, ABBYY, or Yooz can further enhance data capture accuracy and streamline the entire AP workflow.

Benefits of Invoice Capture in Dynamics 365 Finance

1. Improved Accuracy and Reduced Errors

Manual data entry is not only slow—it’s prone to human error. Invoice capture tools automatically extract and validate data, ensuring that information like invoice amounts, due dates, and vendor details are accurate before they reach your ERP system.

2. Faster Invoice Processing

With automation, invoices can be ingested, matched, and routed for approval within minutes. This reduces cycle times significantly and helps you take advantage of early payment discounts or avoid late payment penalties.

3. Seamless Integration with AP Workflows

Invoice capture in Dynamics 365 can be linked to your purchase order and payment processes. Automated 2-way or 3-way matching (invoice, PO, and receipt) minimizes the need for manual review and enables touchless processing for compliant invoices.

4. Enhanced Visibility and Control

AP managers can monitor invoice status in real-time and identify bottlenecks quickly. Dashboards and reporting tools provide insights into KPIs like invoice cycle time, exceptions, and vendor performance.

5. Support for Compliance and Audits

Automated systems create an audit trail for every invoice, showing when it was received, who approved it, and when it was paid. This simplifies compliance with internal controls and external audits.

How to Get Started

To implement invoice capture in Dynamics 365 Finance, you can explore native functionality as well as third-party integrations. Microsoft offers Dynamics 365 Invoice Capture, a relatively new capability that uses AI Builder and Power Automate to streamline invoice processing. Alternatively, many companies integrate with AP automation providers like Rio, which offer advanced features such as supplier portals, exception handling, and invoice archiving.

Key Steps:

• Assess your current AP process: Understand where bottlenecks and inefficiencies exist.
• Define your requirements: Consider volume, approval workflows, data accuracy, and integration needs.
• Choose the right solution: Whether native or third-party, ensure the solution integrates smoothly with Dynamics 365 Finance.
• Train your team: Ensure staff understand how to review, approve, and manage invoices using the new system.
• Monitor and optimize: Continuously review performance data to further refine and improve your AP process.
  
  

Modernize Your Invoice Workflow Today

Invoice capture is a crucial step toward digitizing your finance operations. For organizations using Dynamics 365 Finance, the ability to automate invoice processing can lead to significant cost savings, greater accuracy, and stronger financial controls.

By removing the burden of manual data entry, your AP team can focus on more strategic tasks—like managing cash flow, improving vendor relationships, and driving continuous improvement.

Fill out the form below to see if Rio could help streamline your AP processing.