All 24 Invoice Processing questions
More in Invoice Processing
Walk through the journal entry when a supplier invoice is recorded. What is a duplicate invoice and how do you prevent duplicate payments? How does electronic invoicing (e-invoicing) and OCR improve AP processing? What are invoice exceptions and how are they handled? How is input VAT/sales tax handled on purchase invoices? What is a credit note (credit memo) and how is it processed in AP? How are foreign-currency supplier invoices recorded and revalued? What is a pro forma invoice and how is it treated? How are prepayments to suppliers accounted for? How do recurring invoices (e.g., rent, subscriptions) get processed efficiently?
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Accounts Payable & Receivable › Invoice Processing

What is an approval workflow and why is it important?

Intermediate

Answer

An approval workflow routes an invoice to the people authorized to approve the spend, based on rules like amount thresholds, cost center, or GL account (a delegation of authority matrix). It enforces segregation of duties, ensures budget holders sign off, creates an audit trail, and prevents unauthorized or fraudulent payments.
Real-world example Invoices over $10,000 automatically require a second approval from the department director per the authority matrix.

Common follow-ups: What is a delegation of authority matrix? | How does approval support SOX controls?

Vendor Management Payment Runs Invoice Processing
All 24 Invoice Processing questions