How to Set Up NetSuite Procure to Pay

Discover the steps for how to set up Netsuite procure to pay for your procurement and PO management process, invoice processing, and global payments. Streamline and make the procure-to-pay process with NetSuite more efficient with automation software.

What is Procure to Pay?

Procure to pay is a business process workflow cycle from intake to procure for procurement and purchasing processes to receiving goods and vendor invoices, processing supplier invoice, including invoice document matching with the PO and receiver, getting approvals, and making and reconciling global payments. 

Procure-to-pay includes the purchase requisition and order-to-cash payment process. 

Does NetSuite Have Procure to Pay?

Although NetSuite includes real-time procure-to-pay, your business needs the additional efficiencies, cost savings, error reduction, fraud control, and global regulatory compliance benefits of multi-entity procure-to-pay automation software having third-party add-on integration with NetSuite.   

NetSuite is an ERP system that provides a core ERP and offers many additional optional Suites or modules for NetSuite, including OneWorld for multinational, multi-entity and multi-currency companies. Tipalti procurement and AP automation software integrates with NetSuite ERP and NetSuite OneWorld. Its other software products also integrate with NetSuite. 

In NetSuite, you can evaluate and view a scorecard of vendor delivery performance with vendor performance scores as part of the NetSuite procure to pay process. 

How to Set Up Procure to Pay in NetSuite 

Procure to pay in NetSuite includes procurement, including the purchase requisition and purchase order process in NetSuite, and invoice processing, including entering vendor invoices, verifying the correctness of these supplier invoices, and making global payments to vendors. 

Steps to set up procure to pay in NetSuite ERP are:

1. Enter a new vendor
2. Create item(s) to purchase
3. Create a purchase requisition
4. Find and edit a purchase order
5. Record the receipt of items/goods
6. Enter the supplier invoice as accounts payable
7. Pay the approved supplier/vendor invoice in batch
8. Reconcile payments to the general ledger

1 – Enter a new vendor

The steps to enter a new vendor in NetSuite are:

• Lists > Relationship > Vendor > New
• Enter vendor name and contact information

2 – Create item(s) to purchase

The steps to create items in NetSuite are:

• Lists > Accounting > Items > New
• Select inventory or non-inventory item
• Insert item name, item number, description, vendor, and tax schedule in fields

3 – Create a purchase requisition

The steps to create a purchase requisition in NetSuite are:

• Transactions > Purchases > Enter Requisition > New
• Enter the Requestor’s Name
• Department
• Date
• Item Required
• Submit to reach Pending status
• Create an order requisition to automatically create a purchase order
• Select OK for Started status 

4 – Find and edit a purchase order

The steps to finalize a purchase order in NetSuite are:

• Transactions > Purchase > Enter Purchase Order > List
• Edit fields for Kind, Price, Quantity, etc. 

5 – Record the receipt of items/goods

The steps to record the receipt of items/goods in NetSuite are:

• Pending receipt is automatically created in NetSuite
• After comparing to the purchase order, enter information about quantity received and condition of items received in NetSuite
• Finalize the item receipt in NetSuite to change status from Pending

6 – Enter the supplier invoice as accounts payable

The steps to enter the supplier invoice as accounts payable in NetSuite are:

• Enter the details of the invoice received from the supplier in NetSuite, including:
  • Invoice number
  • PO number
  • Invoice date 
  • Payment terms (contract terms)
  • Due date
  • Invoice amount 
  • Payment due date 
• Match invoice to purchase order and investigate any discrepancies

7 – Pay the approved supplier/vendor invoice in a batch

The steps to pay multiple vendors’ invoices in a batch in NetSuite (after the approval process) are:

• Transactions > Payables > Pay Bills
• In A/P Account Field, select a payables account
• In Account field, select the bank account for making a payment
• Balance field shows the bank account balance
• Date field automatically uses the current date 
• Choose the accounting period for posting 
• Select Department, Class, Location, and any Custom Segment
• Enter a date in both the Start Date field and End Date fields 
• Ensure that invoices without a due date entered in NetSuite get included in the payment
• To print vendor bill payments, check the To be Printed box 
• Check Use Bill-to Address from Vendor if desired, or enter vendor payment address on invoice
• Click Select Item to scan in transaction bar codes
• Check the box in the Pay column next to the bills and check Credit for any credits to apply to the payment amount
• Amount field at top of page shows total payment amount for checked bills and credit offsets

Note you can use NetSuite OneWorld for multi-currency. To make electronic fund transfers (EFTs), you can check EFT Bill Payment on the vendor record. NetSuite calculates the Bank Fee for EFTs using the Electronic Bank Payments SuiteApp.

8 – Reconcile accounts payables and payments to the general ledger

The steps to reconcile accounts payable and payments in NetSuite are:

• Compare accounts payable and payments to the general ledger 
• Investigate, reconcile, and record any differences

Common Challenges of Procure to Pay

9 common challenges of procure to pay are:

1. Time-consuming and error-prone paper-based documents and manual data entry processes
2. Lack of visibility for purchase requisition, PO, payables, and supplier invoice payment status
3. Inadequate spend management and payables hedging
4. Issuing costly POs for routine and low-cost maverick spend/tail spend
5. Not processing invoices in time to take lucrative early payment discounts
6. Fraud and payment error risks
7. Inadequate internal controls and global regulatory compliance
8. Expensive and time-wasting global payment methods and high currency conversion costs
9. Time-consuming manual payables and payments general ledger reconciliation processes

Streamline Processes with Procure to Pay Automation

With Tipalti’s procure-to-pay automation software, your business will streamline and efficiently automate its purchase requests, purchase orders (POs), supplier onboarding, three-way matching, workflow for invoice approvals, and global payments for multi-entity companies. NetSuite+Tipalti integration enhances your payables process. 

With NetSuite integration, Tipalti saves 80% of the time required to complete end-to-end payables processes, accelerates the monthly close by 25%, reduces payment errors by 66%, and gives you enough time to take early payment discounts by reducing inefficiencies. Tipalti’s P2P process automation also reduces fraud risk and improves financial controls. Tipalti has a 98% customer retention rate for its time-tested automation software and provides excellent customer support to its large customer base. 

Tipalti AP automation, advanced FX solutions (including Tipalti Multi-FX and FX Hedging), global partner payments, Expenses, and procurement software seamlessly integrate with NetSuite ERP and NetSuite OneWorld through the prebuilt integration. 

Summing It Up

The procure to pay business cycle includes:

• Employee purchase requisition and purchase order (PO) management in the procurement process
• Approvals of new supply chain vendors and purchasing contracts/POs by purchasing managers and business approvers
• New supplier onboarding and management
• Supplier invoice processing (including verification, 2&3-way PO-matching, and approvals)
• Mass payments with advanced FX (foreign exchange) solutions
• Automated payment batch reconciliation

Third-party automation software for procurement and finance with NetSuite ERP integration and NetSuite OneWorld integration from solution provider, Tipalti, streamlines and improves the procure to pay process, saving your business time and money. This type of automation software provides functionality with key features to help your business eliminate many of the routine and time-consuming NetSuite procure to pay steps that we listed. With supplier portal visibility and status notifications for your suppliers and the company, you will have accurate supplier information and improve relationships.

Tipalti’s finance automation software gives your finance team more time to shift its focus to strategic decision-support and analytical work that can improve business results. To achieve more efficiency and optimize results for your NetSuite P2P cycle, discover Tipalti advanced procurement and AP automation software for Oracle NetSuite procure to pay. Get started with a demo.