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Supplier Invoicing: Optical Character Recognition

Optical Character Recognition (OCR) Functionality

OCR (Optical Character Recognition) technology electronically reads a business’ documents by identifying the key information visible and converting it into electronic data. This information or data can then be used internally for any business process or to help process business documents such as the supplier invoice. This drives efficiency and eradicates risk of user error.

OCR technology in Dynamics 365 Finance and Operations allows for the automated extraction of data from scanned or digitized documents such as invoices, receipts, purchase orders, and other financial documents. OCR technology enables the system to interpret and convert scanned images of text into machine-readable data, eliminating the need for manual data entry and improving accuracy and efficiency. Here’s an overview of OCR functionality in Dynamics 365 Finance and Operations:

  1. Invoice Capture: With OCR integration, invoices received via various channels, including email, mail, or EDI, can be captured and digitized. The OCR engine extracts relevant information from scanned images or electronic files, such as vendor details, invoice number, invoice date, line item details, and amounts.
  2. Data Extraction: The OCR technology in Dynamics 365 Finance and Operations analyzes the document image and identifies text patterns, characters, and structures. It then extracts the relevant data and maps it to the appropriate fields within the system, such as vendor records, purchase orders, or general ledger accounts.
  3. Data Validation: The extracted data is validated against predefined rules and criteria to ensure accuracy and consistency. This includes verifying data formats, checking for duplicates, validating against existing records, and performing data reconciliation with related documents or master data.
  4. Automation and Integration: Once the data is extracted and validated, it is automatically integrated into the relevant modules of Dynamics 365 Finance and Operations. This seamless integration eliminates the need for manual data entry and ensures data consistency across the system.
  5. Exception Handling: In cases where the OCR engine encounters difficulties in extracting certain data elements or encounters discrepancies, the system can be configured to route the document to users for manual review and correction. This allows for exception handling and ensures accurate data capture.
  6. Accuracy and Continuous Learning: OCR technology in Dynamics 365 Finance and Operations utilizes machine learning algorithms to improve accuracy over time. As users review and correct OCR results, the system learns from these interactions and enhances its data extraction capabilities, increasing accuracy and reducing manual intervention over time.
  7. Document Search and Retrieval: OCR-enabled documents become fully searchable within the system, allowing users to quickly locate specific documents based on their content. This enhances document management capabilities and improves overall productivity.

By leveraging OCR technology in Dynamics 365 Finance and Supply Chain Management, organisations can significantly reduce manual data entry efforts, eliminate errors, improve data accuracy, and streamline document processing across various financial processes. This automation ultimately leads to increased efficiency, improved decision-making, and enhanced financial management.

APQC Framework

Please find below the relevant PCF ID’s.

Level 1 Category: 17058

Level 2 Process Group: 10733

Level 3 Process: 10756