Turning Policy into Practice: Enforcing AP Controls with D365 Finance & Operations.

Nexora Technologies, a global provider of digital infrastructure and consulting services, was facing challenges with:

 - Inconsistent vendor invoice submissions, some missing PO references, or incorrect tax codes
 - Frequent early or duplicate payments leading to cash flow imbalances
 - Manual validations consume excessive finance team bandwidth
To address this, Nexora implemented Vendor Invoice Policies and Vendor Payment Policies in D365 F&O:

🎯 Strategic Objectives - 

To resolve these issues, Nexora launched an initiative tied to the following strategic objectives:

 - Enhance AP process control across all legal entities
 - Minimize audit risks by enforcing system-based validations
 - Improve vendor relationship management through timely and accurate payments
 - Reduce manual intervention by automating exception handling and approvals
  - Align financial governance with enterprise policy standards

⚙️ Implementation rollout plan

Nexora adopted a phased rollout of vendor invoice and payment policies in D365 F&O across its global footprint:

Phase 1: Discovery & Policy Design
 - Assessed existing AP processes
 - Identified non-compliance risks and root causes
 - Defined policy rules based on vendor types, categories, and spend thresholds
Phase 2: Pilot Rollout in North America
 - Configured Vendor Invoice Policies to validate POs, tax codes, and categories
 - Set up Vendor Payment Policies for term enforcement, duplicate checks, and payment schedules
 - Enabled policy violation workflows with role-based approvals
Phase 3: Global Rollout
 - Extended configurations to EMEA and APAC business units
 - Tailored policies by region to reflect local tax and regulatory requirements
 - Conducted user training and policy violation resolution workshops

✅ 1. Vendor Invoice Policies Setup

- PO Matching Rule: Enforced 3-way match for invoices above $5,000
- Tax Code Validation: Prevented incorrect tax configurations
- Procurement Category Control: Prevented mismatch between PO and invoice lines
- Violation Routing: Flagged and routed non-compliant invoices for review

✅ 2. Vendor Payment Policies Setup

Minimum Term Enforcement: No early payments before Net 30 terms
Scheduled Payment Days: Consolidated vendor payments on Thursdays
Duplicate Invoice Blocking: Auto-held duplicate entries
Vendor Bank Verification: Blocked payments without validated bank info

📊 Business Impact

After global implementation, Nexora observed measurable improvements:

🚀 Result: Stronger audit readiness, streamlined AP operations, and improved vendor trust.

💼 Why This Matters

With D365 F&O, vendor invoice and payment policies aren’t just guidelines—they’re active controls that ensure every transaction is validated before it flows through the system.

Whether you’re working in a shared service model or across decentralized legal entities, the automation of policy checks brings consistency, scalability, and audit assurance to your finance organization.

💡 Key Takeaways
- Vendor policies in D365 F&O enable proactive governance
- System-enforced validations reduce compliance risk
- Exception routing allows for streamlined approvals without delays
- Policy flexibility ensures regional and category-specific customization
- Strategic rollout can yield significant time and cost savings