Archives for : February2013

The 2 types of PDF invoices and why this can make a big difference to your business

There are 2 basic types of PDF invoices that businesses receive from their suppliers.

1. An Text PDF generated directly out of an accounting software system and received electronically (most typically as an email attachment).

2. A scan or fax which originated in an accounting software system but is now an image rather than a text document.

How can you tell the difference?

If you can use a mouse to select/highlight the text in a PDF, it is a Text PDF. How to tell if an Invoice is an Text PDF in 5 seconds.

An text PDF typically won’t have any hand writing on it.

An text PDF won’t be skewed, like when a piece of paper goes through a scanner a little bit crooked.

Printing and scanning typically introduces little blemishes onto the page.

Why would you care about the difference?

When the data is received electronically (i.e. 1 above) it can be automated into an accounting system using a tool like InvoiceSmash with minimal oversight. The one click processing is possible because the data starts out digital, is transmitted digitally and is entered into the accounting system as digital data. For example, lets say you receive regular invoices from a supplier XYC company. The first time you process a XYC company invoice using InvoiceSmash, you set up all the rules for how it should be entered into your accounting software, which GL accounts to use, which inventory etc. Thereafter each time you process an invoice from XYC company the software will automatically resolve it for you and you will presented with a one click submission screen.

OCR sucks

On the other hand, if you are receiving the invoices via 2 above, you have a conversion problem. You have to convert the data from ‘paper’ to digital data. This can be done using OCR technology. OCR stands for Optical Character Recognition. Basically the computer looks at the picture of the character or word and uses probability to assert that ‘0’ is zero and ‘i’ is a lowercase ‘I’ and not an ‘L’. The problem is that even the best OCR software sometimes gets it wrong (best case is 90% accuracy, but sometimes much worse) which means someone has to maintain oversight and vigilance, and provide data verification and data repair. Hopefully this is the responsibility of specialist bookkeepers and accounts staff, but quite often we see even high level staff having to do their own data entry.

Ok so OCR is bad, but why do you care?

Its simple, accessing the data digitally in Text PDFs, you save yourself most or all of the data entry and data oversight effort (i.e. the conversion problem). Its a simple change. Just ask your suppliers to send the invoices as email attachments and you’re done. 99.99999% of suppliers these days are happy to oblige because its easier and cheaper for them to be paperless as well.

 

The new official InvoiceSmash blog is up

After our V1 launch last week, it is time to launch our official blog.
This blog will be were we talk about

  • What we’re doing with InvoiceSmash
  • How to’s and information about how to get the most out of invoicesmash
  • What’s happening in the accounting/bookkeeping industry.
  • Whats happening in the software startup industry.

 

Mark Burch (Founder)