Invoice Approval Workflow for Logistics

# Invoice Approval Workflow - Logistics

## Purpose
Implement to prevent unauthorised spending, maintain audit trails, and speed up payment processing for your accounts team.

## When to Use
A structured approval workflow for incoming invoices that routes through the correct approvers based on amount thresholds and department.

## Instructions
1. Review the template below and familiarise yourself with the structure
2. Replace all [bracketed placeholders] with your logistics business details
3. Customise the tone and formatting to match your brand
4. Save in your preferred tool (Xero or Zapier)

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## Invoice Approval Workflow

### Trigger
Supplier invoice received via email, post, or direct upload to Xero.

### Steps

**Step 1: Receive and Log Invoice** (Owner: Accounts Payable Officer) - Within 4 hours
Record the invoice in Xero as a draft bill. Verify the supplier exists in the system. Attach the original invoice document (PDF or scan) to the Xero record.
- Tool: Xero
- Output: Draft bill created with attachment

**Step 2: Validate Invoice Details** (Owner: Accounts Payable Officer) - Within 4 hours
Check the invoice for completeness: ABN, correct entity name, purchase order number (if applicable), line item descriptions, GST treatment, and payment terms. Flag any discrepancies.
- Tool: Xero
- Output: Invoice validated or discrepancy flagged

> Decision Point: If the invoice fails validation, return to the supplier with a specific correction request. Pause this workflow until a corrected invoice is received.

**Step 3: Code to General Ledger** (Owner: Accounts Payable Officer) - Within 4 hours
Assign the correct GL account code, tracking category (department/project), and tax rate to each line item. Ensure the coding aligns with the approved budget.
- Tool: Xero
- Output: Invoice fully coded and ready for approval

**Step 4: Route for Approval** (Owner: Automated via Zapier) - Immediate
Automatically route the invoice based on amount thresholds:
- Under $500: Department Manager approval only
- $500 to $5,000: Department Manager + Finance Manager
- Over $5,000: Department Manager + Finance Manager + Director
Send a Slack notification to the first approver with invoice details and a link to review in Xero.
- Tool: Zapier + Slack
- Output: Approval request sent to correct approver(s)

**Step 5: First-Level Approval** (Owner: Department Manager) - Within 2 business days
Review the invoice for legitimacy: Was this purchase authorised? Does it match the agreed price? Is the work/delivery confirmed as received? Approve or reject in Xero with a note.
- Tool: Xero + Slack
- Output: Invoice approved or rejected with reason

> Decision Point: If rejected, notify the Accounts Payable Officer via Slack with the rejection reason. The AP Officer contacts the supplier or the team member who ordered the goods/services to resolve. If approved, proceed to the next approval level (if required) or to Step 7.

**Step 6: Second-Level Approval** (Owner: Finance Manager or Director) - Within 2 business days
For invoices exceeding the threshold, review coding accuracy, budget availability, and approval history. Approve or send back for clarification.
- Tool: Xero + Slack
- Output: Final approval granted or queries raised

**Step 7: Schedule Payment** (Owner: Accounts Payable Officer) - Within 1 business day of final approval
Schedule the payment in Xero according to the supplier's payment terms. Group payments into the weekly payment run where possible to reduce transaction costs.
- Tool: Xero
- Output: Payment scheduled in the next payment run

**Step 8: Process Payment** (Owner: Finance Manager) - On payment run day (e.g., Thursday)
Review the batch payment list. Confirm bank details match Xero records. Authorise the payment run in your banking platform.
- Tool: Xero + Bank platform
- Output: Payments processed and recorded

**Step 9: Reconcile** (Owner: Accounts Payable Officer) - Within 2 business days of payment
Match the bank transaction to the Xero bill. File the completed invoice record. Update any tracking spreadsheets or dashboards as required.
- Tool: Xero
- Output: Invoice fully reconciled and closed

### Completion Criteria
- [ ] Invoice recorded with correct GL coding
- [ ] Appropriate approval(s) obtained based on amount threshold
- [ ] Payment scheduled within supplier terms
- [ ] Bank transaction reconciled in Xero
- [ ] All documents attached to the Xero record

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**Complexity:** intermediate | **Setup time:** 15 minutes | **Tools:** Xero, Zapier, Slack

Note: This template has been tailored for logistics businesses in Australia. Adjust terminology and compliance references to match your specific context.