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Agents AP Performance Narrative Agent
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AP Performance Narrative Agent

Analyzes AP KPIs and trends to generate executive-ready performance narratives and insight summaries.

Preparing accounts payable performance reports often requires time-consuming manual work: collecting metrics, investigating anomalies, and crafting clear explanations for executives. This can delay insight delivery and produce inconsistent narratives.

The AP Performance Narrative Agent analyzes transaction data, ledgers, analyst notes, and external benchmarks to extract key KPIs, identify anomalies, and determine probable root causes. It then produces concise, narrative-style explanations that highlight trends, risk factors, and cash-flow implications. Reports include supporting evidence from invoice attachments, audit trails, and source documents so narratives remain factual and audit-ready.

By moving the focus from data assembly to insight consumption, the agent reduces reporting effort, shortens delivery cycles, and improves consistency in executive reporting. Finance leaders receive timely, actionable narratives that support decision-making and compliance review.

Accuracy
TBD

Speed
TBD

Input Data Set

Sample of data set required for AP Performance Narrative Agent:

Memorandum: AP Performance Reporting – Q3 2024


To: AP Performance Reporting System

From: John Doe, Senior AP Analyst, InnovateCorp

Date: October 5, 2024

Subject: Raw Data and Preliminary Notes for Q3 2024 AP Performance Analysis




1. Aggregated KPI Summary






Metric
Q3 2024
Q2 2024
Change
Observation






Days Payable Outstanding (DPO)
46
45
+1 day
Slight increase in average payment time.




Total Invoices Processed
12,540
10,980
+14.2%
Higher volume than forecasted, increasing workload.




On-Time Payment Rate
87%
94%
-7 pts
Significant decline requiring root-cause analysis.




Early Payment Discounts Captured
$45,200
$68,500
-34%
Missed discounts likely due to delays and exceptions.




Invoice Exception Rate
9.5%
6.0%
+3.5 pts
Higher exceptions impacting throughput and accuracy.








2. Analyst Observations


    

  • The on-time payment rate decline is a key concern. Early indications point to onboarding issues with Quantum Dynamics, which became a major supplier starting in July.  
    • 

  • A large volume of invoices from Quantum Dynamics contained incorrect PO numbers and incomplete line-item data, leading to delays in validation and increased exception queue volume.  
    • 

  • The invoice volume surge (+14.2%) exceeded forecasts, contributing to operational strain and processing delays.  
    • 

  • The reduction in early payment discounts captured suggests a need to quantify the financial impact of late payments and strengthen discount capture processes.
    • 





3. Exception Log Highlights






Exception ID
Vendor
Invoice No.
Issue Type
Amount
Days in Queue






77401
Quantum Dynamics
QD-2024-9811
PO Mismatch
$150,000
18




77492
Apex Solutions
AS-INV-0043
Duplicate Invoice
$22,500
4




77531
Quantum Dynamics
QD-2024-9904
Missing GRN
$88,000
15




77610
Quantum Dynamics
QD-2024-10012
PO Mismatch
$125,700
12








4. Preliminary Insights for Q3 Analysis


    

  • Vendor Onboarding Impact: The Quantum Dynamics onboarding issues appear to be a significant driver of increased exception rates and delayed payments.  
    • 

  • Process Capacity: Invoice volume growth exceeded current processing capacity, suggesting a need to reassess staffing or automation levels.  
    • 

  • Financial Leakage: Missed early payment discounts indicate potential working capital inefficiencies worth quantifying and addressing.  
    • 

  • Exception Resolution Priorities: High-value exceptions (notably from Quantum Dynamics) require expedited review to minimize financial and operational risk.
    • 





Next Steps:  


    

  • Conduct a detailed root-cause analysis of exceptions associated with new vendors.  
    • 

  • Quantify financial impact of missed discounts and delayed payments.  
    • 

  • Review process capacity and automation needs ahead of Q4.  
    • 

  • Engage procurement to improve data quality and PO accuracy from key suppliers.
    •

Deliverable Example

Sample output delivered by the AP Performance Narrative Agent:

Accounts Payable Performance Report: Q3 2024


Executive Summary


InnovateCorp's Accounts Payable department processed a 14% increase in invoice volume during Q3 2024 while maintaining a stable Days Payable Outstanding (DPO) at 46 days. Performance challenges included a decline in on-time payment rate to 87% (from 94% in Q2), driven primarily by onboarding issues with a new key vendor, Quantum Dynamics. This led to increased invoice exceptions and a 34% reduction in early payment discounts captured. The report details root causes, financial impact, and a predictive outlook for Q4 2024.




Quarterly KPI Dashboard






Key Performance Indicator
Q2 2024
Q3 2024
Change
Trend






Days Payable Outstanding (DPO)
45 Days
46 Days
+1 Day
Stable




Total Invoices Processed
10,980
12,540
+1,560
Rising




On-Time Payment Rate
94%
87%
-7%
Warning




Early Payment Discounts Captured
$68,500
$45,200
-$23,300
Warning




Invoice Exception Rate
6.0%
9.5%
+3.5%
Critical








Performance Analysis & Narrative


Root Cause Analysis: On-Time Payment and Discount Decline


    

  • Invoice Exceptions: Exception rate increased from 6.0% to 9.5%, primarily due to onboarding issues with Quantum Dynamics.  
    • 

  • Vendor-Specific Issues: Invoices from Quantum Dynamics frequently contained PO Mismatch and Missing Goods Receipt Note errors (e.g., #77401, #77531, #77610). Average time in exception queue: 15 days.  
    • 

  • Financial Impact: Late processing caused a 34% reduction ($23,300) in captured early payment discounts.  
    • 

  • Volume Pressure: 14% increase in total invoice volume strained AP team capacity, slowing exception resolution.
    • 



DPO and Cash Management


Despite delayed payments, DPO remained stable at 46 days, indicating overall cash outflow and cycle management remained effective.




Exception Log Highlights






Exception ID
Vendor
Invoice No.
Issue Type
Amount
Days in Queue






77401
Quantum Dynamics
QD-2024-9811
PO Mismatch
$150,000
18




77492
Apex Solutions
AS-INV-0043
Duplicate Invoice
$22,500
4




77531
Quantum Dynamics
QD-2024-9904
Missing GRN
$88,000
15




77610
Quantum Dynamics
QD-2024-10012
PO Mismatch
$125,700
12








Predictive Forecast: Q4 2024 Outlook


    

  • On-Time Payment Rate: Projected to recover to 90-92% as AP resolves Quantum Dynamics invoice issues.  
    • 

  • Invoice Exception Rate: Expected to decrease to ~7% with corrective actions.  
    • 

  • DPO: Forecasted to remain stable in the 45–47 day range.
    • 





Recommendations


    

  1. Vendor Collaboration: Align processes with Quantum Dynamics’ AR team to correct invoice submissions and PO matching.  
    2. 

  2. Process Automation: Implement automated PO validation rules for high-volume new vendors to prevent errors on receipt.  
    3. 

  3. Team Training: Provide AP staff training on handling Quantum Dynamics exceptions to reduce resolution time.
    4.

Maximize Impact Across Core Functional KPIs

Employee Productivity
Process Cycle Time
Risk Reduction
Data-Driven Decision Making

By automating the manual collection, analysis, and assembly of AP performance data, it liberates finance teams to focus on strategic financial management.

Automate Report Generation
  • Automatically extracts KPIs from transaction data, ledgers, and analyst notes.
  • Synthesizes performance metrics into a coherent executive summary.
  • Drafts clear, context-rich narratives explaining performance trends and drivers.
  • Schedules and distributes periodic performance reports to key stakeholders.
Reduce Manual Investigation Efforts
  • Proactively pinpoints anomalies and deviations from performance benchmarks.
  • Analyzes historical data to identify the probable root cause of exceptions.
  • Consolidates supporting evidence like invoices and audit trails for quick review.

Drastically shortens the reporting cycle from data collection to insight delivery, providing leadership with faster access to critical financial intelligence.

Accelerate Data-to-Insight Conversion
  • Processes vast amounts of AP data in minutes, not days.
  • Generates initial performance narratives instantly upon data ingestion.
  • Eliminates delays caused by manual data compilation and formatting.
Streamline Executive Review Cycles
  • Delivers consistent, easy-to-digest report formats for faster comprehension.
  • Provides direct links to source documents to answer questions immediately.
  • Enables finance leaders to act on insights sooner, improving business agility.

Proactively identifies financial risks by continuously monitoring AP activities and providing transparent, audit-ready performance documentation.

Enhance Anomaly Detection
  • Continuously scans for unusual payment patterns or duplicate invoices.
  • Flags transactions that deviate from established internal policies.
  • Highlights potential cash-flow risks based on payment term trends.
Improve Audit & Compliance Readiness
  • Generates factual, evidence-backed narratives suitable for audit reviews.
  • Maintains a clear link between summary insights and source transaction data.
  • Ensures consistent application of reporting standards across all summaries.

Transforms raw AP data into actionable, strategic insights, empowering leaders to make more informed decisions on cash flow and vendor management.

Elevate Strategic Insights
  • Identifies emerging trends in payment cycles and discount capture rates.
  • Connects AP performance metrics to broader cash-flow implications.
  • Compares internal performance against external industry benchmarks for context.
Improve Communication with Leadership
  • Translates complex financial data into a clear business narrative.
  • Provides executives with consistent, timely, and reliable performance summaries.
  • Highlights key takeaways and recommended focus areas for leadership attention.

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