We will be going through the process of measuring the average cost to process an invioce from start (issuing a PO) to finish (making payment). Are there any templates or examples available that we could use?


We do not currently have a separate downloadable template for invoice process costing. Many companies do this differently and take into account different types of cost. However, we do have an invoice processing calculator that can be used on a micro or macro level for determining the processing cost.

For instance, you can enter the total cost of your labor and overhead into the calculator and come up with an average cost overall. Another way to use it is to break down your AP operations into discrete processes such as incoming mail processing, PO matching to invoice, data entry, 1099 compliance, check disbursement, and outgoing mail, for example. You could gather the cost data for each operation and use the unit of measure (e.g., invoice, PO, envelope...) that drives the cost for the operation. So where the calculator asks to input the number of invoices you can use that input for the number of envelopes processed by the AP mail operations. You would then add up each discrete process and get a total cost to process an invoice. This latter approach is referred to as Activity Based Costing where you determine the key drivers of cost in an AP operation.

You can find the invoice calculator in the Tools+ main topic under the subtopic Calculators or click on this link to go directly to it.

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