Invoice approval process flowchart
A swimlane invoice approval process template: capture, duplicate check, three-way PO match, coding, approval by value, supplier queries, posting and payment.
How it works
Rename the swimlanes to your real roles
Replace Supplier, Accounts payable, Budget holder and Finance manager with the roles in your organisation. If a shared service centre does capture and matching but a local controller does coding, split the accounts payable lane in two so the hand-off is visible.
Define your duplicate check keys
Decide what makes two invoices the same. Supplier ID plus invoice number is the primary key; gross amount plus invoice date catches suppliers who re-issue with a new number. Write the keys into the note on the 'Duplicate invoice?' step so nobody has to guess.
State your PO policy
Set the rule for which spend requires a purchase order and what happens when it should have had one. If non-PO invoices above a certain value are not permitted, add that as an exit from the 'PO referenced on invoice?' branch instead of letting it pass silently into coding.
Set the tolerance and the approval threshold
Fill in real numbers on the 'Match within tolerance?' and 'Over approval threshold?' decisions, for example a 5 percent or fixed-amount price tolerance and a budget holder limit above which the finance manager countersigns. Vague thresholds are the most common reason a mapped process is ignored.
Decide what happens to stalled queries
The template ends unresolved queries at 'Return invoice to supplier'. Most teams also want an ageing rule, for example a chase at seven days and escalation at fourteen. Add those as timed steps or as notes on the query loop so exceptions cannot sit indefinitely.
Circulate the chart and keep the approved version
Walk the map through with AP, a budget holder and the finance manager, correct what they actually do rather than what the policy says, then keep the agreed version under version control so later edits are tracked and the current approved diagram is unambiguous.
Frequently asked questions
What are the steps in an invoice approval process?
A typical sequence is: receive the invoice from the supplier, capture it into the AP system with supplier, invoice number, date, net, VAT and any PO reference, check it is not a duplicate, decide whether it is a PO or non-PO invoice, match PO invoices against the purchase order and goods receipt note or send non-PO invoices to the budget holder for cost centre and GL coding, route for approval according to value, obtain budget holder approval plus a finance manager countersignature above the threshold, post the invoice to the ledger, and schedule it in the next payment run. Exceptions branch off into a query with the supplier and rejoin the flow once corrected.
How do you prevent duplicate invoice payments?
Run the duplicate check before any matching or approval work, as early as capture. Match on supplier ID plus invoice number as the primary key, and add a secondary check on gross amount plus invoice date to catch re-issued invoices with a new number. Suspected duplicates should be blocked and flagged for review rather than silently deleted, because a genuine second invoice for the same amount does occur, for example on recurring monthly charges. Duplicates most often slip through when the same invoice arrives on two channels, such as email and a supplier portal, so the check must sit downstream of every intake route.
What is the difference between PO and non-PO invoice approval?
A PO invoice already carries the commercial agreement, so approval is largely a matching exercise: the invoice is compared against the purchase order and the goods receipt note, and if price and quantity fall within tolerance the spend has effectively been pre-approved. A non-PO invoice has no reference point, so a person has to confirm the spend is valid and assign the cost centre, GL account and tax code before it can be routed for approval. That extra coding step is why non-PO invoices take longer, and why many organisations set a value limit above which a purchase order is mandatory.
Who should approve an invoice, and how do value thresholds work?
The budget holder whose cost centre carries the charge should approve every invoice, because they are the only person who can confirm the goods or service were received and belong to them. A value threshold adds a second approver above a set amount, typically the finance manager or controller, so higher-value spend gets a second pair of eyes without adding delay to routine invoices. Thresholds should come from a written delegation of authority and be applied by the routing rule rather than chosen case by case, and a rejection at either level should route back into the supplier query loop rather than simply stopping.