Invoices piling up, vendors waiting on payments, and approval delays that never seem to end.
Sound familiar?
For most Accounts Payable (AP) teams, the pressure is constant. You’re expected to cut costs, reduce errors, and somehow keep operations running smoothly all at once.
Traditional automation tools can help a little by moving tasks along faster or cutting down on data entry, but they usually stop short when things get complicated.
The moment an exception pops up, like a mismatched PO or a missing approval, someone has to jump back in and manually sort it out. That’s why real transformation in AP requires something more than just “automation.” It calls for agentic automation.
In this blog, we’ll explore how to build a smart AP automation system using Microsoft Power Automate, AI Builder, and Dataverse.
Together, these tools can help your team:
- Offload time-consuming tasks like invoice capture and validation
- Manage exceptions intelligently so they don’t pile up on someone’s desk
- Seamlessly connect procurement and finance workflows for better visibility and control
The result? Fewer headaches, faster approvals, and an AP process that feels less like a bottleneck and more like a driver of business value.
What is Agentic Automation?
At its core, agentic automation is about giving automation a bit of “brains.”
Unlike traditional automation that blindly follows fixed rules, like a robot doing the same task over and over, agentic automation can think and adapt. It mimics human decision-making, which means it can respond intelligently when things don’t go according to plan.
Imagine an invoice comes in with a small discrepancy in the amount. Traditional automation would either flag it for manual review or reject it outright.
Agentic automation, on the other hand, can analyze the context, cross-check related records, and even route it to the right person for approval, sometimes even suggesting the correct action.
Beyond handling exceptions, agentic automation can communicate across departments and systems. It doesn’t just sit in AP; it collaborates with procurement, finance, and even vendors to ensure workflows are completed accurately and efficiently.
In short, it’s like having a digital teammate that never sleeps, never makes careless mistakes, and can handle the messy, unpredictable parts of AP that usually eat up human time.
Why Accounts Payable Needs Agentic Automation?
Picture this: your AP team no longer spends hours opening emails, downloading invoice PDFs, and typing data into the system. Instead, a smart automation system handles most of the heavy lifting for you.
Here’s what it can do:
- Scan invoice PDFs automatically from emails or SharePoint, so nothing slips through the cracks.
- Extract key fields using AI, like invoice number, date, vendor details, and amounts, without any manual typing.
- Validate invoices against purchase orders to catch mismatches before they become problems.
- Automatically approve or flag discrepancies, so routine invoices move quickly while exceptions get the attention they need.
- Route exceptions for human review, making sure the right person sees the right issue at the right time.
- Post clean invoices into your ERP, keeping financial records accurate and up to date.
- Send notifications back to vendors, keeping them informed and reducing follow-up emails.
All of this happens without manual data entry or endless email ping-pong.
The result?
Faster invoice processing, fewer errors, and a happier AP team and vendors, who finally get timely responses.
With agentic automation, the system isn’t just following rules; it’s making decisions, adapting to changes, and keeping your AP process moving smoothly from start to finish.
How to Build Agentic Automation for Accounts Payable with Power Automate
Let’s walk through how to turn a manual, error-prone AP process into a smooth, intelligent workflow. Using Power Automate, AI Builder, and Dataverse, you can create a system that handles invoices from start to finish with minimal human intervention.
To make this happen, you’ll use a combination of tools:
- Power Automate Cloud Flows for orchestrating the process
- AI Builder for reading and extracting invoice data
- Dataverse for storing invoice, PO, and approval information
- Power Apps to provide a user-friendly interface for approvers
- Power BI (optional) to visualize exceptions and metrics
With this setup, your AP team can finally spend less time on repetitive tasks and more time on strategic work, while maintaining accuracy, compliance, and speed across the entire invoice lifecycle.
Building a smart AP workflow with Power Automate doesn’t have to be overwhelming.
Here’s a clear step-by-step guide showing how your team can set it up:
Step 1: Trigger the Flow When an Invoice Arrives
First, you need to tell the system when to start working. Use a Power Automate trigger like:
- “When a new email arrives”: perfect if invoices come via Outlook.
- “When a file is created in SharePoint”: ideal for uploaded invoices.
This ensures no invoice gets lost, and every new document kicks off the automation automatically.
Step 2: Extract Invoice Data Using AI Builder
Next, use AI Builder to read and extract key information from each invoice. You can train a model or use a prebuilt Invoice Processing Model to capture:
- Invoice Number
- Vendor Name
- PO Number
- Amount
- Line Items
No more manual typing; AI reads the data accurately and passes it along for the next step.
Step 3: Match Invoices with Purchase Orders
Now, validate the invoice by checking it against your purchase orders. Use a Dataverse table or a connector to your ERP to verify:
- Vendor ID
- Amount
- Line item quantities
This step ensures that only correct invoices move forward, reducing errors and rework.
Step 4: Handle Exceptions Intelligently
Not every invoice will match perfectly, and that’s okay. Here’s how agentic automation handles exceptions:
- Mismatch in Amount → automatically route to the AP Manager via an approval flow.
- Missing PO Number → send a clarification email to the vendor automatically.
- Log exceptions in Dataverse → visualize them in Power BI for easy reporting and tracking.
Your team only reviews the cases that truly need human judgment.
Step 5: Set Up Approval Workflow
Use Power Automate Approvals or a Power App interface to let reviewers approve or reject flagged invoices. This keeps approvals organized and auditable.
Step 6: Post Approved Invoices to ERP
Once approved, automatically post invoices into your ERP using prebuilt connectors like Dynamics 365 Business Central, QuickBooks, or a custom API connector. This keeps your financial system up to date without manual entry.
Step 7: Send Confirmation and Update Records
Finally, notify vendors that their invoice has been processed and update internal logs (Dataverse or SharePoint). Everyone stays informed, and your records are accurate and complete.
Benefits of Agentic Automation in Accounts Payable
Implementing agentic automation in AP isn’t just about cutting down on manual work; it completely changes the way your department operates.
Here’s what your team can gain:
1. Faster Processing Times
Gone are the days of invoices sitting in someone’s inbox for days, waiting for approvals. With agentic automation, invoices flow through the system automatically, from intake to approval to posting in your ERP.
Your team no longer wastes time chasing emails, manually entering data, or following up with colleagues. Payments get processed faster, deadlines are consistently met, and month-end closes become smoother.
2. Reduced Errors from Manual Entry
Manual data entry is not only time-consuming; it’s prone to mistakes. Even small typos in invoice numbers or amounts can cause delays, duplicate payments, or compliance issues. AI Builder reads invoices and extracts critical data accurately, while automated matching against purchase orders and vendor records ensures that errors are caught before they escalate.
This dramatically improves the reliability of your financial records and reduces the stress of reconciliation.
3. Intelligent Exception Handling
Not every invoice will be perfect, and that’s where agentic automation truly shines. Instead of overwhelming your team with every single mismatch or missing PO, the system intelligently identifies which cases need human attention and routes them to the right person.
It can even suggest corrective actions or send clarification requests to vendors automatically. This means your team spends time only on what truly requires judgment, rather than fighting fires all day.
4. Improved Vendor Communication
Keeping vendors informed is a key part of healthy supplier relationships. Automated notifications let vendors know when their invoices have been received, approved, or require additional information.
No more back-and-forth emails, phone calls, or frustrated vendors wondering when they’ll get paid. Faster communication means stronger partnerships and a better reputation for your business.
5. End-to-End Visibility with Power BI Dashboards
With all AP data stored in Dataverse, you can visualize your entire workflow in dashboards. Monitor processing times, track exceptions, measure approval bottlenecks, and analyze trends.
This transparency doesn’t just help managers make informed decisions; it allows the AP team to continuously improve processes and spot inefficiencies before they become major problems.
Final Thoughts
Agentic automation using the Power Platform is more than just automation; it’s a way to transform your Accounts Payable department into a smarter, faster, and more strategic team.
By adding intelligence, decision-making, and exception handling, AP teams can process invoices with fewer errors, handle exceptions seamlessly, and focus on higher-value tasks instead of manual data entry.
With a resilient, scalable system in place, finance and procurement workflows become fully aligned, approvals happen faster, and routine tasks move automatically, bringing you closer to a truly touchless invoice process.
At Bitcot, our workflow automation services are designed to help organizations implement this kind of intelligent AP automation.
From building end-to-end workflows with Power Automate, AI Builder, and Dataverse, to designing approval interfaces and dashboards, we deliver solutions tailored to your business needs.
Get in touch with us today to learn how our team can streamline your AP processes, improve accuracy, and create real strategic value for your organization.
