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Settings

Setting up Invoicing and Credit Memo Approvals

Two levels of approvals are supported for invoices: invoice approval and invoice line approval.

Invoice Approval

Invoice approval approves the invoice as a whole for payment. Typically, an invoice is approved by the person responsible for the account to which the invoice costs are charged.
Most invoices do not require approval. The costs were approved when the requisition and/or purchase order was created. However, invoice approvals can be used to:
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Approve invoices that do not refer to a purchase order
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Approve credit memos (by selecting credit memo invoice types for approval)
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Approve high value invoices
Invoice approval can be activated by invoice type. Because the invoice type defines whether the invoice is a regular invoice or credit memo, you could require that credit memos be approved, while not requiring approval for invoices.
For invoices, approval route selection is based on the GL accounts charged. The approval route’s automatic approval threshold amount is used to automatically approve low value invoices.

Invoice Line Approval

Invoice line approval is used to approve the individual lines on an invoice. Line approval is used when the invoicing clerk cannot accept an individual line because the price difference exceeds the defined tolerances. This situation requires an additional level of approval.
If an invoice line is entered and its price difference exceeds the tolerances, the following behavior occurs:
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If line approval is being used:
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The invoicing clerk is warned that the price exceeds the price tolerances.
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The invoice line status is set to unapproved. The invoice’s post method is disabled; the invoice cannot be posted until the line is approved.
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The invoice line is sent for approval.
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The line is approved.
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If there are no other lines that require approval, the invoice can now be posted.
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If line approval is not being used:
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The invoicing clerk is warned that the price exceeds the price tolerances.
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The invoice’s post method is disabled; the invoice cannot be posted until the line is made acceptable.
Approval route selection is based on the purchase order line’s buyer.
Approver limits are based on the value of the difference between the purchase order line and invoice line. For example, if the purchase order line value is $1,000 and the invoice line value is $1,500, the line must be approved by an approver with an approval limit of $500 (the difference between the purchase order line and the invoice line).

Invoice Line Approval for Extra Charge and Tax Lines

Invoice line approval can also be used to approve an invoice’s extra charge and tax lines. Approval for these lines works in the same way as regular invoice line approval: if the value of the line is different than the expected price and the difference exceeds the tolerances, the line must be approved.
Extra charges and taxes included on the invoice that were not identified on the invoice’s purchase order are assumed to have an expected price of zero; the extra charge or tax was not identified as being applicable for the purchase order.
Extra charge and tax lines on invoices that do not reference a purchase order do not have to be approved. Only extra charges and taxes on purchase order invoices require approval.

Using Invoice and Line Approval Together

When both invoice and invoice line approvals are being used together, the workflow is as follows:
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Any invoice lines that require approval must be sent for approval and be approved.
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Once all of the lines have been approved, the invoice is sent for approval.
After you enter the approval settings, to use approvals with these documents you must set up authorized employees as approvers, and create appropriate approval routes.

To Enter Invoicing Approval Settings

1.
On the site window, select the Approvals view and the Settings tab. Select the Settings in the tree.
2.
Select the Invoicing tab.
3.
Click Edit to modify the site settings. The Edit button is replaced by the Save button.
4.
Select the types of documents that require approval. When you select an option in the Invoice documents area, the corresponding tab is added.
Setting Name
Description
Invoices
Select whether or not whole invoices require approval before they can be posted.
You may also select some or all of the invoice types that require approval.
Invoice resource lines
Select whether or not invoice lines require approval. When this option is selected, invoice lines that are outside of the site’s defined price tolerances need to be approved before they can be posted.
Invoice extra charge lines
Select whether or not extra charge invoice lines require approval. When this option is selected, extra charge lines that are outside of the site’s defined price tolerances need to be approved before they can be posted.
Invoice tax lines
Select whether or not tax invoice lines require approval. When this option is selected, tax lines that are outside of the site’s defined price tolerances need to be approved before they can be posted.
5.
If invoices require approval, select the Invoices tab and select the invoice types.
6.
If invoice lines require approval, select the Invoice Lines tab.
7.
For each of the types of lines that require approval, specify the value that the approval is based on. The options are:
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Value of the price difference – approval is based on the total value of the line
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Change since previous approval – approval is based on the net change in the value of the line. For example, if the line was approved for $1000 and then redrafted and changed to $1,150, re-approval is required for the $150 difference.
8.
Click Save.