Invoice validation involves confirming that supplier invoices are accurate before approval and payment. But for many small and medium-sized businesses (SMBs), manually processing dozens, hundreds, or even thousands of statements each month inevitably leads to mistakes. Not only does this lead to wasted time and money, high invoice volumes also put the accounts payable (AP) cycle↗ at a greater risk of fraud.
That’s why teams are turning to structured, automated invoice validation processes, as these systems increase speed, transparency, and reliability.
This guide covers the key aspects and challenges of invoice validation and shows how automation addresses them.
What’s invoice validation, and why does it matter?
Invoice validation confirms that each received invoice is authentic and corresponds correctly to goods or services delivered to your organisation. For small and mid-sized businesses (SMBs), it’s a key control point in the AP workflow, preventing duplicate payments, avoiding overpayments, and flagging irregularities.
Finance teams often juggle high volumes of paperwork with limited resources, so they rely on automated invoice validation to stay compliant with tax rules and internal policies. These tools also protect against fraud and keep cash flow steady.
Sometimes, invoice validation is confused with invoice verification. Although related, invoice validation and verification serve different roles in AP. Verification happens first, checking that every detail matches purchase orders (PO) and complies with company rules. Validation comes after invoice capture but before approval, confirming that the statement matches the product or service and meets what the companies actually ordered.
Some organizations with smaller teams or less formal AP processes might combine verification and validation or skip one step. Generally, this depends on risk tolerance and system automation.
4 steps and best practices in the invoice validation process
An efficient invoice validation process moves systematically, from collecting invoice data↗ to approving payment. Automation strengthens each stage by reducing manual work and minimising errors. Let’s take a look at four steps and the best practices that accompany each.
- Data capture and duplicate prevention
The first part of invoice validation ensures all invoice details are present and correctly formatted. Key fields include supplier names, tax IDs, and total amounts. Capturing accurate information at this stage prevents delays and errors later in the process.
Automation and Optical Character Recognition (OCR) tools make this process faster and more reliable. They pull information straight from digital files, standardise formatting, and apply field-level validation rules. At the same time, automated systems detect duplicates by flagging related invoice numbers and amounts. This way, finance teams can resolve issues immediately.
Solutions like Moss’ invoice inbox and e-invoicing support↗ collect all incoming invoices in one place. Once added, the system scans each invoice, pre-fills key details such as supplier, invoice number and due date, highlights duplicates, and prepares them for the next stage of review and approval.
- Invoice verification and cross-checking
Next comes invoice verification, which ensures each document aligns with existing records. Best practices use a three-way match: the invoice, PO, and goods receipt note (GRN).
This step confirms the supplier only billed for the items that were actually ordered and received. Any mismatches could indicate errors or unapproved costs. Automated systems flag these issues immediately and route them for review, reducing manual checks and keeping approval workflows accurate.
Best practices use a three-way match between invoice, purchase order, and evidence of delivery. In Moss, invoices can be linked to purchase requests and routed through a dedicated verification step, where verifiers confirm that the amounts and items match what was ordered and delivered and can challenge any discrepancies for review.
Moss enhances three-way matching using our unique Verify step. Other platforms might let you upload a delivery note, but Moss acknowledges the reality that delivery notes don’t always exist, or aren’t enough. Instead, Moss proactively engages the right person in the organisation with notifications and approval routing, ensuring a three-way match without slowing down workflows.
- Policy and approval validation
In the final validation step, finance teams confirm that each invoice complies with spending policies, budget limits, and approval hierarchies. Generally, these manual checks impede workflow with back-and-forth messages and sign-offs. Automation applies rules consistently and sends invoices to the right people for approval. It also maintains a clear audit trail for compliance and escalates exceptions automatically. By handling this step digitally, teams keep the approval process fast and fully aligned with company rules.
- Payment authorization
Once every validation step is complete, the invoice moves to a different process, payment authorization. This is where teams give final approval and queue payments. Finance teams release payments only after they complete all validation steps. Automation records every approval and keeps a complete audit trail for traceability and accountability.
To stay on top of approvals and manage workflow efficiently, finance teams use status views and filters to see which invoices are still under review, still pending approval↗, or already approved. In Moss, dedicated views like the Verify tab and ‘To approve’ lists give approvers an up-to-date picture of what needs their attention so payments can be released on time.
Common challenges in manual invoice validation
As SMBs grow, manually validating invoices becomes more difficult. Finance teams often face the same recurring issues:
- Incomplete or missing data: Teams spend time following up on invoices with typos, missing supplier details, and incorrect amounts.
- Duplicate invoices: Duplicates often appear only during invoice reconciliation↗, increasing the risk of overpayments.
- Slow approvals: Manual routing and unclear approval responsibilities delay payments.
- VAT and tax compliance: Keeping up with rules and paperwork adds extra work and increases the chance of errors.
- Limited process visibility: Teams struggle to see the status of invoices in real time, making it hard to manage workflow efficiently.
How automation improves invoice validation
Automation makes invoice validation faster and more accurate. Modern AP software like Moss uses configurable rules to handle repetitive checks, such as scanning invoices to pre-fill supplier and invoice details, applying default accounting attributes via supplier rules, and routing invoices through the correct approval steps.
By using automation to validate invoices, finance teams reduce errors and maintain complete visibility at every stage. They can track documents that are pending, flagged for discrepancies, and fully validated, gaining insight and control without the added manual work.
Automating validation steps also creates a reliable audit trail, ensuring every invoice meets company policies and compliance requirements. For SMBs, this streamlined approach allows teams to focus on higher-value work, like analysing spending patterns.
Streamline invoice validation with Moss
Moss helps SMBs turn invoice validation from an error-prone task into a structured, reliable process. Our accounts payable workflows automate key checks — from capturing, detecting duplicates, and coding invoice details, to routing them through the right approvals — so teams can keep paperwork accurate, traceable, and aligned with internal controls.
Automation also provides full visibility and maintains a clear audit trail, giving finance teams control and confidence at every stage. By combining best practices with Moss, businesses can streamline validation and free teams to focus on other tasks.
Explore Moss↗ today to make invoice processing faster and more reliable.
