Complete guide to Netsuite invoice processing

While companies might have shifted from physical paper invoices to digital ones that can be created from software like Microsoft Excel, etc.

It is still not enough to avoid the errors that occur from disorganized management of invoices even as digital files.

Matching the data on an invoice with other supporting documents like a purchase order or goods receipt is important to verify the legitimacy of the invoice.

The struggle every accounting team faces while doing this is that it consumes a lot of time.

When there are multiple identical invoices from a vendor and no proper way to segregate them through a system, it can lead to confusion in the minds of the accountants who have to process them.

When there isn’t a proper system to track and store invoices, these documents can easily get lost in long email threads. This makes it hard to find invoices that are pending and can cause late payment issues.

Whenever there is human effort involved in completing a task, errors are bound to happen. On top of that, the traditional ways of invoice processing relied heavily on accountants to manually check and match invoices.

When done in larger quantities, even the smallest of errors in monetary details can cause a huge loss to your business.

A byproduct of no proper system and lack of visibility is dealing with invoices from unknown sources.

A common occurrence among finance and accounting teams is that they receive invoices from unknown sources that they are unable to verify and know whether an expense has been legitimately made by the company’s employee or not.

Another byproduct of the lack of a proper system is the error of paying for duplicate invoices. Sometimes, it doesn’t even have to be duplicate invoices.

A simple mishap of entering an extra number on the amount to be paid for an invoice can lead to a huge loss and extra efforts are spent to get the amount refunded. 

The advantage of using Netsuite’s cloud software is that it acts as a central system for sales, finance, and operational data.

This allows your teams to always be in sync with each other and know how crucial aspects of other departments affect their own.

Within this centralized system, whenever the company makes a sale, the respective team member must create a sales order. 

Once this sales order is created it is automatically sent for approval within the system itself.

The first step of Netsuite’s automated invoicing happens when the respective authority approves a sales order; an invoice is automatically generated for the same with all the necessary order details including tax.

Once the invoices are prepared, sending the invoices as per a schedule to your clients can also be automated.

This is done using a pre-selected method based either on the status of the relevant project, the shipment confirmation status, or other custom criteria.

These invoices once scheduled can be sent electronically as an email or in the form of an XML document and also printed and delivered via mail services or faxed.

Netsuite gives you the option to create payment links for the invoices you send out to clients so that they can easily make payments.

When they receive the invoice digitally, they will be able to click the link that redirects them to the payment page and allow them to use payment methods like ACH payments, PayPal, Master Card, Visa, Discover, American Express.

The invoice also includes a QR code so that clients receiving physical invoices can scan it through the camera app on their mobiles and it will redirect them to the same payment link page.

Your customers can easily save their preferred payment details so that they don’t have to re-enter all of their details the next time they are paying another invoice from you.

Once your client makes the payment, the Netsuite system will automatically update the status of your invoice to ‘Paid in Full.’

If a partial payment has been made, then the invoice status will remain open, but the amount that is due will be adjusted accordingly.

Once the payments have been made, a business can record these documents as legal proof of payment.

Once the payment has been received, your invoice status will change and reflect on the Netsuite dashboard.

This will give the finance and accounting team a better picture of the overall state of invoices and record them in the general ledger of the company.

If you want your clients to pay in a certain way, then offering incentives to do that is a great method. For example, you can charge a convenience fee to your customers in place of processing credit card transaction fees.

You can also enable zero-fee payments for direct bank-to-bank transfers at the same time. When you do this, you promote free B2B payments, which are much more cost-effective than using a credit card.

You can also incentivize early payments by setting discount rates that a client will get if they pay before a certain date.

When you receive a receipt of the invoice, the finance team of the business will have to verify if such a product or service was procured.

They must coordinate with the respective team members either manually or use Netsuite’s centralized system where they can view and check the sales or operations data.

The data must then be matched with the relevant purchase order to verify whether the invoice details are the same as what was procured.

If there are any discrepancies, it must be alerted to the team immediately to rectify the situation.

Thanks to Netsuite’s 3-way matching technology, it automatically detects discrepancies in order quantities, rate of goods, and duplicate invoices, and flags them so that the AP team can immediately take the next steps to correct the errors.

Once the invoice has been verified, it is ready to be sent to the necessary team members who are responsible for approvals.

Once approved, based on the agreed terms and conditions with your vendor, set the invoice to be paid.

You can either schedule the invoice for payment or pay it early to get the early payment discount from your vendor if it has been offered. If your vendor has allowed partial payments, you can also opt for that method.

Once the payment has been made, the necessary information must be forwarded to the accounting department so that they can update it in the general ledger.

Once the invoice is paid, the amount is removed from accounts payable with debit and an offsetting credit to cash.

Netsuite allows you to create invoice approval workflows within its system to easily coordinate with team members and process invoices.

The first step in the workflow is the initiation/bill validation stage where an employee who is responsible for handling AP is checking to see if there are any errors. During this stage, they can edit and save the invoice details as per the verification.

After the checking and verification are done, the invoice will move forward in the workflow once they click the submit for approval button on the invoice within the Netsuite system.

Once the submit for approvals button is clicked by the AP employee, it is moved to the next stage of the workflow where the invoice is sent to the respective team members who were added as approvers when the workflow was set up.

Now, the ‘Approve’ and ‘Reject’ buttons will only show up for the people who are added as approvers. The invoice is also locked and they will not be able to edit any fields or values.

If the approvers find any discrepancies, they cannot directly edit the field or values as it is locked. They must add notes and reject the invoice.

This puts the invoice in a ‘Rejected’ stage and an email is sent out to the AP employee informing the same.

This will allow the AP employee to rectify any errors that got the invoice rejected and the invoice will now show a ‘Resubmit for Approval’ button to push it back into the ‘Pending for Approval’ stage.

Once the approver sees that all changes have been made and rectified, they can hit the ‘Approve’ button and the invoiced will move to the ‘Approved’ stage and be ready for payment.

Getting yourself familiarized with how the Netsuite dashboard works and understanding each aspect will help you carry out your tasks smoothly without any roadblocks.

Netsuite has made its platform extremely simple and intuitive for all users so that there is minimal room for confusion.

To process invoices as fast as possible, you must ensure that you are not spending time manually entering vendor details each time you have to process an invoice.

Netsuite’s system allows you to create and save vendor details so that you can automatically fill in their details when necessary.

The benefit of creating and saving vendor or supplier details including their contact information is that you get to process payments for them much faster and avoid time-intensive manual work that could lead to errors.

Another best practice is to request purchaser receipts from vendors when paying their invoices. This receipt will act as proof of payment for both parties.

Netsuite’s automated invoicing is such that it can directly use an uploaded purchase order in the system to turn it into an invoice to send to your vendor or supplier.

Since Netsuite is a centralized system for finance, sales, and operations, an AP employee can easily check data on purchases made by employees that need to be paid for within a specific billing cycle.

This visibility helps the team stay on top of payments and get them processed in a timely manner.

When sending invoices through Netsuite, the system allows you to select the options that you would give a client to pay through. Enabling multiple payment options gives the client flexibility to pay as and gets you paid faster.

Netsuite’s dashboard and AP reporting capabilities allow your accounting team to monitor payments of all vendors or suppliers so that you can manage cash flow effectively and efficiently.

The system will give you the ability to create expense reports from commonly used accounting report templates for payment history and AP aging.

These reports can also be customized as per your specific needs. The data for these reports are updated in real-time and you can filter them by the department, location, vendors, or category of the expense.



There might be instances where you have to return certain goods to your vendors due to various reasons.

These vendor returns need to be managed properly so that when the vendor credits you it is adjusted in the accounting books accordingly.

Another benefit of using Netsuite’s invoice automation system is that it automatically adds the relevant tax percentage and amount when an invoice is generated within the system.

This allows for easier overall calculation of the amount that needs to be paid by a client to you.

Netsuite allows you to add the item receipt that you receive from a vendor when they supply you with goods. The item receipt can be attached to its specific purchase order in the system.

You can also add the item receipt in case of partial delivery as the system allows you to change the order quantity when attaching the item receipt.

Once all the necessary details have been changed and validated by the person handling the goods at the warehouse, you can simply save item receipts data to the purchase order and this will help create a proper invoice.

You can easily create bills or invoices for your vendors through the ‘Enter Bills’ shortcut on the AP role’s home dashboard or use the global search bar to search for a specific saved vendor in your database.

And then create an invoice from their details so that you don’t have to fill in all the information again.

You can make changes to various fields like the posting period, select the currency you want to pay in and the payment terms, the location, and the expense account that you want to pay from.

Three-way matching is a method by which the details on an invoice are cross-checked with the relevant purchase order and the delivery receipt.

This is done to ensure that all the details mentioned on a supplier invoice are accurate and you don’t end up paying more than you actually owe a vendor.

Only when all three documents match with the correct details can it move to the approval stage and then finally for the payment.

You should always look for an expense management system that gives you visibility and control over all spending through a single dashboard and has various ways to make and receive payments.

Certain aspects like setting spending limits, approval policies for money transfers, submission policies for reimbursements & card expenses are things you should be able to do easily when choosing a payable product.

Another factor that you should consider when choosing an expense management solution is whether it allows you to consolidate invoices into one single payment.

This makes it easier for your clients to make payments without spending a lot of time processing separate invoices. Another crucial feature to check for is whether it allows for partial payments.

This might be an important thing that is necessary for your clients to maintain a stable cash flow.

If your business deals with international vendors and suppliers, having the ability to pay in different currencies through an expense management system can be very beneficial.

You can avoid certain payment network fees and also the forex charges that are incurred.

The expense management system that you choose should integrate with Netsuite in such a way that it is able to carry out a two-way sync with the platform.

This will help you retrieve and send crucial data without having to make changes to transactions manually.

Many solutions might integrate with Netsuite but would require manual intervention to sync data.

You should ideally choose a solution that allows you to set automatic sync periods for transactions to directly be synced into Netsuite’s accounting system.

Using OCR technology the system detects crucial information from invoices received via email or uploaded manually and turns it into a bill that can be processed further for payments.

Once an invoice has been created on Volopay, it can easily be forwarded to the respective team members who have been set as approvers for that particular type of expenditure.

You can also set automatic email reminders to be sent to your clients before the invoice due date so that they don’t miss out on the payment and end up having to pay a late fee.

Instead of following the traditional way of constantly having to communicate over email threads, now invoice processing is done through a centralized platform that is meant for processing invoices.

Any rectifications needed before an invoice is approved can easily be flagged by the approver and sent back for rectifications with a custom note to avoid any sort of confusion.

Since all the invoices are processed through a single channel, there is more transparency and visibility for the AP department. This helps them in making the process more efficient.

Having a single source of truth like a dashboard where you can track and view all payments makes the auditing process much more efficient than having to manually create reports and maintain files in accordance with each other.

Volopay allows you to customize your expense workflows so that it aligns with the methods that you were following previously. This helps reduce the friction that comes along with making a shift to a new system.

Related read: Guide to accounting automation with Netsuite API integration