Exception Management
The systematic process of identifying, categorizing, and resolving invoices that fail automated processing.
Definition
Exception management is the discipline of handling invoices that cannot be automatically processed due to mismatches, missing data, policy violations, or other issues. Effective exception management includes categorizing exceptions by type, routing to appropriate resolvers, tracking resolution time, and analyzing root causes to reduce future exceptions.
Why It Matters
Exceptions are the bottleneck in AP automation. Even with 90% touchless processing, the remaining 10% of exceptions can consume 80% of AP staff time if not managed efficiently.
Examples
Price exception
Invoice price is 5% higher than the PO price. System routes to the buyer who confirms a price increase was agreed upon.
Missing PO exception
Invoice arrives without a PO reference. System routes to the department that likely ordered the goods for PO creation.
How Nexus AP Helps
Nexus AP uses AI to auto-resolve common exceptions and routes complex ones with full context, reducing average resolution time by 70%.
Start Free TrialFrequently Asked Questions
What are the most common AP exceptions?
Price variances, quantity mismatches, missing POs, duplicate invoices, and missing goods receipts account for 80% of all exceptions.
What is a good exception rate?
Best-in-class organizations achieve 10-15% exception rates. Rates above 25% indicate process or data quality issues.
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