January 14th & 16th 2025, Release Note: Adaco: Ingesting Invoices & Credits from PDF and Other Image Files

Summary

Release date: January 14th (EMEA & APAC) & 16th (US) 2025

• Enabled by default? - No
• Set up by customer admin? - No
• Enable via support ticket? - No - please liaise with your Fourth contact
• Affects configuration or data? - No

What's Changing?

Adaco is now able to ingest invoices and credit notes provided in PDF or other image file formats. The data extracted from the image files can be matched against an existing purchase order or used to automatically create a non-PO invoice.

Reason for the Change

This accommodates suppliers unable to integrate with Fourth's 'Trade Simple' platform electronically, automates non-PO invoice creation (for suppliers who do not receive purchase orders, such as service or utility suppliers), and eliminates manual data entry, improving accuracy and efficiency.

Customers Affected

Customers contracted to use Fourth's Document Processing Service - please get in touch with your Fourth Account Manager to discuss further.

Release Note Info/Steps

Invoice and/or Credit Note data can be extracted from PDF or other image files provided in the following ways:

• Your suppliers send their invoices as PDF attachments to a bespoke email address, hosted by Fourth but bespoke to your business
• Your own accounting team can scan physical paper invoices and send them as PDF attachments to the same bespoke email address
• Paper invoices can be scanned/photographed and uploaded at the time of receiving, via the Receiving app 

Regardless of how the invoice or credit note is received, it will be processed by the Document Processing Service and the resulting data sent to your Adaco site. 

Where the vendor has provided a valid purchase order number on their invoice which matches an existing purchase order in Adaco, the invoice will be automatically assigned to that order. It will then be displayed in the Adaco 'Receiving' screen or the 'Invoice' tab in the Receiving app, from where it can be applied to the order.

Fig.1 - Purchase Order in the Receiving screen showing the existence of an invoice captured in the Document Processing Service

Where the invoice is provided after the order has already been received then it will either be automatically matched to the receiving, (providing it matches within any specified tolerances), or where the invoice does not match the receiving it will be assigned to the receiving but not applied in the 'Receiving Corrections' screen.

In both the Receiving and Receiving Corrections screens the relevant data extracted from the invoice will be displayed, as well as a paperclip icon to show the original image document. 

Fig.2 - Purchase Order in the Receiving  Corrections screen showing the data from an invoice as well as a link to the original invoice image

Where the supplier has not provided a valid Purchase Order number, the following will occur:

• Where purchase orders are issued to the supplier but the supplier does not reference it correctly on their invoice, the invoice will be shown in the 'Unassigned Invoices' screen. From here a user can identify and assign the relevant purchase order
• Where purchase orders are not issued to the supplier (for example, utility suppliers or service providers), a non-PO invoice will be automatically created and sent for appropriate approval. These invoices will be visible in the 'Invoice Review/Approval' screen. When creating the non-PO invoice, the invoice value will be split appropriately between a specified GL account and any GL account used to record taxes such as a VAT accrual account. Once created, the non-PO invoice will be automatically routed for approval via an appropriate route specified for the supplier
• For both PO and non-PO invoices, a secure link to the original document image can be included in the AP export provided to your finance system so that the original invoice images can be accessed from your accounting system as well as from Adaco

The processing of invoices for each supplier will be configured by Fourth's Integration Team using information provided by you and your suppliers as follows:

• Customer Number - this is the reference the supplier uses to identify the individual property to which the invoice relates.  This is typically the supplier's account number for your business or specific delivery account
• Vendor Name - this is used to identify the vendor and should be the vendor's name as it appears on their invoices, which may be different to how you name the supplier in Adaco
• Default Account - for PO vendors this will be used for any ad-hoc products created for new substitute items on the invoice but not in the supplier's existing catalogue in Adaco. For non-PO suppliers, this will be used to post the total invoice value less any taxes identified on the invoice.
• Default Rate - this is used for non-PO suppliers. The account associated with the rate will be used to post any taxes identified on the invoice
• Approval Route - used to automatically route the invoice for approval. Note: Where an approval route is specified the invoice will need to be finally approved before it can be exported to the accounting system. This is regardless of the setting Property > Administration > Receiving > Enable Manual Invoice Approval Routing which only impacts manually entered non-PO invoices 
• Default Outlet - for non-PO Invoices this will be used as the Outlet for the invoice distribution lines. Can be left empty if the invoices do not need to be charged to a specific outlet
• Create invoice without a PO - When ticked, a non-PO invoice will be created where no matching PO can be found. When unticked, the invoice will be shown in the Unassigned Invoice screen from where it must be assigned to a PO

Fig.3 - Configuration of the Vendor Interface which controls how invoices will be processed for a supplier

Note: When a non-PO invoice is created from a supplier's invoice the invoice value will be allocated between the default GL account and the specified Tax Rate using the default outlet GL account. However, this can be adjusted during the approval process if you want to amend the exact invoice distribution between different GL accounts or outlets.

New Terms/Acronyms 

Document Processing Service (DPS) - Fourth's AI-powered service for extracting structured data from PDF or other image files.