Glossary
The AP Automation Glossary
Plain-language definitions for the terms finance and operations teams use when modernizing accounts payable.
Accounts Payable (AP)
The money a business owes its suppliers for goods and services purchased on credit.
Read definitionAccounts Payable Invoice Processing
The workflow that moves vendor invoices from receipt through matching, approval, payment, and GL posting.
Read definitionAccounts Payable Invoice Scanning Software
Software that digitizes AP invoices and feeds them into capture, matching, and approval workflows.
Read definitionAccounts Payable Outsourcing Providers
Third parties that run some or all of a company’s AP operations on its behalf.
Read definitionAccounts Payable Process Improvement
Systematic changes that make AP faster, cheaper, more accurate, and easier to audit.
Read definitionAccruals
Expenses recognized before the related invoice is received or paid.
Read definitionACH Payment
An electronic, bank-to-bank funds transfer processed through the ACH network, governed by Nacha.
Read definitionACH Transfer
An electronic bank-to-bank movement of funds through the U.S. Automated Clearing House network, processed in scheduled batches.
Read definitionAP Automation
Software that replaces manual invoice processing with intelligent digital workflows covering capture, matching, approval, and payment.
Read definitionApproval Workflow
The defined path an invoice follows to be reviewed and approved for payment.
Read definitionAutomated Invoice Processing System
Software that uses OCR and AI to capture, validate, and route vendor invoices to the ERP with minimal manual work.
Read definitionBatch Payment Processing
Grouping approved invoices into a scheduled payment run instead of paying them one by one.
Read definitionCloud-Based Accounts Payable Automation
AP automation delivered as a hosted service rather than software installed on company servers.
Read definitionDays Payable Outstanding (DPO)
The average number of days a company takes to pay its suppliers.
Read definitionDuplicate Invoices
The same vendor invoice submitted or entered more than once, risking a double payment.
Read definitionDuplicate Payment
Paying the same invoice more than once.
Read definitionEarly Payment Discount
A discount suppliers offer for paying an invoice before its due date.
Read definitionElectronic Approval of Invoices
Approving vendor invoices digitally instead of with wet signatures or paper routing.
Read definitionEnd-to-End Accounts Payable
Managing the full AP lifecycle from invoice receipt through payment and ledger posting in one connected process.
Read definitionEnterprise Resource Planning (ERP)
Integrated software that manages core business processes like finance, procurement, and operations.
Read definitionExpense Management
The process for tracking, approving, reimbursing, and reconciling employee-initiated spending like T&E, meals, and office supplies.
Read definitionGeneral Ledger (GL)
The central record of all of a company’s financial transactions.
Read definitionGL Coding
Assigning invoices to the correct general ledger accounts.
Read definitionGoods Receipt
A record confirming that ordered goods were received.
Read definitionInvoice
A supplier’s itemized bill requesting payment for goods or services delivered.
Read definitionInvoice Approval Process Flowchart
A visual map of how invoices move from receipt through each approval step to payment.
Read definitionInvoice Approval Software
Software that routes invoices to the right approvers, captures digital sign-off, and records every decision before payment.
Read definitionInvoice Capture
Extracting data from incoming invoices into a structured, usable format.
Read definitionInvoice Capture Software
Software that extracts structured data from vendor invoices and posts clean fields to matching, approval, and the ERP.
Read definitionInvoice Data Capture
The automated extraction of key invoice fields into structured digital records, and the first step in AP automation.
Read definitionInvoice Exception
An invoice that fails validation or matching and needs manual review.
Read definitionInvoice Fraud
Schemes that use fake, altered, or duplicate invoices to steal funds from accounts payable.
Read definitionInvoice Management System
Software that automates the AP lifecycle: invoice capture, matching, approvals, payment handoff, and archiving.
Read definitionInvoice Scanning
The end-to-end process of converting paper or electronic invoices into structured, machine-readable data.
Read definitionInvoice Workflow Software
Software that automates invoice capture, validation, approval routing, and ERP posting in a defined digital workflow.
Read definitionInvoicing and Payment Processing
The AP cycle of receiving, verifying, approving, and paying vendor invoices, ending at the GL post.
Read definitionLien Waiver
A construction document in which a contractor, subcontractor, or supplier surrenders mechanic's lien rights in exchange for payment.
Read definitionMulti-Currency Payment Processing
Paying vendors in more than one currency while keeping accurate AP and GL records.
Read definitionOCR Invoice Software
Software that uses optical character recognition to pull invoice fields into an AP system.
Read definitionOCR Software for Invoice Processing
OCR technology applied specifically to reading and extracting data from vendor invoices.
Read definitionOptical Character Recognition (OCR)
Technology that converts images of text, like scanned invoices, into machine-readable data.
Read definitionPO Number
The unique identifier a buyer assigns to a purchase order to track a transaction from approval through receipt and payment.
Read definitionProcure-to-Pay (P2P)
The end-to-end process from purchasing goods to paying for them.
Read definitionPurchase Order (PO)
A buyer’s official document authorizing a purchase from a supplier.
Read definitionReceived Not Invoiced (RNI)
Goods received but not yet matched to a supplier invoice.
Read definitionRemittance Advice
A document sent by a payer that identifies which invoices a payment covers, the amount paid, and any discounts or deductions applied.
Read definitionRobotic Process Automation (RPA)
Software bots that automate repetitive, rules-based digital tasks.
Read definitionSpend Visibility
Real-time insight into what an organization is spending and committing to pay.
Read definitionStraight-Through Processing
Automated end-to-end handling of a transaction without manual steps.
Read definitionTariffs, Trade Policy & AP Automation
How tariff-driven cost changes show up in supplier invoices and how AP automation detects, codes, and routes them correctly.
Read definitionThree-Way Matching
Verifying an invoice against its purchase order and goods receipt before payment.
Read definitionTouchless Invoice Processing
Processing invoices end to end with no manual intervention on clean transactions.
Read definitionTwo-Way Matching
Verifying an invoice against its purchase order before payment.
Read definitionVendor Master
The central database of approved supplier records and details.
Read definition