Construction Accounts Payable Software That Integrates with Your ERP

Accounts payable (AP) in construction goes far beyond basic invoice processing and data entry. It’s about accurately syncing job costs with projects for clear financial visibility while managing relationships with vendors, suppliers, and subcontractors. Effective AP processes are essential for maintaining a healthy cash flow — a persistent challenge for the construction industry.  

If your firm still relies on manual AP methods, you’re likely facing more risks than rewards. Traditional, paper-based processes and manual data entry are prone to errors and delays, resulting in missed billing cycles, frustrated vendors, costly disputes, and budget overruns that disrupt cash flow.

Fortunately, there’s a better way. Construction accounts payable software is built to address the industry’s unique needs. By automating everything from invoice intake through approvals, AP software for construction eliminates bottlenecks, reduces errors, and streamlines workflows. The result? Improved cost control, stronger vendor relationships, and increased financial stability for long-term growth and profitability.

What Makes Construction AP Unique?

The construction industry’s project-based nature requires specialized AP processes to effectively manage project costs and vendor payments. 

Job-Level Cost Coding and Approval

Construction costs like labor, materials, and equipment are tracked on a per-project basis. Job-level cost coding and approval of expenses are needed to ensure accurate accounting across multiple projects and prevent budget overruns.

Multiple Approvers

Unlike other industries, construction AP uses multi-layered approval pathways, adding complexity to the process. In addition to AP teams, project managers, field supervisors, controllers, and finance teams play a critical role in validating costs, reducing risks, and ensuring accuracy.

Industry-Specific Practices

Retainage, change orders, and lien waivers complicate construction billing and payments. These practices need to be addressed separately and can impact cash flow if not managed properly. Tracking payments and managing documents is also essential for maintaining compliance. 

Integration Requirements

Construction AP processes are closely tied to job costing and payroll systems for accurate allocation of project-based expenses. Integration of these systems is also necessary to ensure compliance with labor regulations and provide audit trails. 

Limitations of Traditional AP Systems

Traditional accounts payable systems may have worked fine in the past, but they can’t support the growing complexity and fast-paced nature of modern construction firms. They fall short in four significant ways:

• Inefficient paper processes: Traditional systems rely on paper and email-based invoices that require physical handling, slowing down your AP workflows. Invoices can easily get lost, misplaced, or left buried in overflowing inboxes — leading to costly delays and frustration.

• Disconnected workflows: Information from receipts, purchase orders, invoices, and project data ends up siloed in separate locations, making it difficult to get a clear and up-to-date view of your costs and cash flow. Traditional AP systems lack real-time integration, leaving teams struggling to track expenses accurately and risking delays and project overruns.

• Error-prone manual cost coding: Manual cost code entry of traditional systems leaves you vulnerable to human errors. Even small mistakes — like a typo or selecting the wrong code — can add up, leading to major financial discrepancies and putting your profitability on the line.

• Lack of visibility: There’s no way to track the real-time status of your invoices in traditional AP systems. This lack of transparency can create bottlenecks in your routing and approval processes, increase the risk of duplicate payments, and make it harder to manage cash flow effectively. 

Why Construction AP Software is Critical for Project Success

Accounts payable automation software gives controllers, accounting managers, and finance staff more insight into their financial operations. It enables teams to streamline processes, reduce errors, and make informed decisions to better control costs. 

Here are some of the top reasons firms are switching to AP software for construction:

• It’s built for job-costing accounting workflows with customizable options to code expenses by job, category, or cost code for more efficient and accurate job costing.
  
  
• Invoice automation for contractors replaces slow, manual AP processes with paperless, automated expense coding, routing, and approval to avoid late payments, payment errors, and cash flow problems.
  
  
• The software centralizes document storage for quick and easy access to all your invoices, receipts,
  purchase orders, and vendor documents in one system. It offers detailed audit trails to ensure compliance and prevent fraud.
  
  
• Construction ERP and AP integration seamlessly syncs real-time data across platforms to eliminate manual double entry and speed up reconciliation — saving you time and increasing visibility of project finances.
  
  

How hh2 Document Flow Boosts AP Accuracy and Efficiency

hh2’s construction accounts payable software, Document Flow, modernizes your AP systems by automating workflows and eliminating manual tasks — boosting accuracy, accelerating approvals, and providing real-time visibility throughout the process.

Digital Invoice Intake

Advanced OCR technology automatically captures invoice data from emails and enters it into your system. Or, use our mobile app to scan paper invoices and receipts while in the field. Data is instantly uploaded and organized into the software, eliminating manual entry and human errors.

Customizable Routing Rules

Speed up your approval process through our customizable invoice and expense routing. Choose from project-based routing, vendor-based routing, or tiered approvals based on a specific dollar threshold around your specific needs.

Mobile Approvals

With Document Flow, you can add unlimited approvers to fit your AP workflow. Our mobile app enables project managers and site supervisors to review and approve expenses instantly — from the field, the back office, or on the go — keeping the process moving without delays.

Real-Time ERP Sync

Seamless integration with top ERPs like Sage 100, Viewpoint Vista, and Foundation ensures AP accuracy while streamlining workflows and giving you real-time visibility into your project finances.

Key Features Built for Construction Finance Teams

Document Flow is purpose-built for construction finance teams, offering essential features such as:

• Cost code validation and smart matching: Automatically code invoices to the correct project. Our smart matching feature links invoices with receipts, purchase orders, and other documents, saving your team time while reducing errors.
  
  
• Role-based access for secure approvals: Ensures team members only access what’s relevant to their roles, streamlining secure, multi-level approvals and reducing fraud risk.
  
  
• Invoice status tracking and alerts: Real-time notifications let you track invoices through every stage of the routing and approval process. You can quickly spot outstanding items or unauthorized payments before they impact cash flow. 
  
  
• Vendor compliance support: Easily capture and store vendor documents like lien waivers or insurance paperwork to simplify compliance and manage project risks.

Save Time, Drive Efficiency, and Other Benefits of Construction AP Software

Construction AP software delivers a wide range of benefits beyond automation. Here are just a few you may experience.

Cut Invoice Processing Time in Half

Document Flow’s automated invoice approval workflows eliminate manual data entry, instantly capturing and syncing invoice data with your ERP — cutting processing and reconciliation time by 50 percent.

Reduce Payment Errors and Duplicate Entries

Manual AP processes are prone to errors. Invoice automation for contractors reduces errors and catches duplicates or discrepancies before you make payments, ensuring greater accuracy.

Improve Vendor Relationships

Faster, more accurate invoice processing results in more on-time payments and fewer disputes with vendors. Real-time invoice tracking and full access to vendor documents build transparency and trust for stronger, long-term partnerships and continued growth. 

Gain Visibility

Real-time visibility into invoice status, outstanding liabilities, and cash flow enables you to manage expenses more effectively and make informed financial decisions. Enhanced transparency provides tighter control over project costs so you can optimize payment timing and improve cash flow management. 

Get Control of AP Without Slowing Down Projects

In construction, AP isn’t just an administrative task; it’s a strategic function where you can optimize cash flow, improve vendor relationships, and ensure profitability — if you’re using the right tools. Construction accounts payable software like hh2 Document Flow empowers your AP, job costing, and finance teams through faster, more accurate, and fully integrated systems. 

Ready to maximize AP efficiency, increase visibility, and enhance cost savings? Explore Document Flow or book a personalized demo today.