Automate the Gaps – Power Automate and Copilot Payables Agent in Business Central
Invoice processing is one of the most repetitive and time-consuming areas of Accounts Payable (AP), especially when approvals, invoice matching, and manual entry are still handled across disconnected processes. Many organizations are also trying to determine where Artificial Intelligence (AI) can provide practical business value without adding unnecessary complexity or risk.
The combination of the Copilot Payables Agent in Microsoft Dynamics 365 Business Central (D365 BC) and workflow automation in Microsoft Power Automate offers a more connected approach by helping you automate repetitive gaps in invoice processing while still keeping the appropriate level of human oversight in place.
In this blog and video, we will look at how the Payables Agent captures and processes purchase invoices, supports three-way matching between invoices, purchase orders, and receipts, and works alongside Power Automate to streamline approval routing and notifications, as well as key setup, governance, and cost considerations for getting started.
One of the advantages of the Copilot Payables Agent is that you can begin automating AP processes without redesigning your entire finance operation or implementing a complex AI initiative. Let’s dive in a bit more on what capabilities are immediately available to you.
A Practical Starting Point for AP Automation
The Copilot Payables Agent in Business Central is an out-of-the-box capability available in cloud deployments of BC version 24 and higher and is designed to work within existing AP processes rather than replace them.
Setup is intentionally lightweight and primarily includes:
- Configuring a dedicated AP mailbox for incoming invoices
- Determining whether invoices should be reviewed before processing
- Defining how invoice emails will be routed and managed
Once invoices are received, the agent automatically monitors the mailbox, extracts invoice information, and creates purchase invoice drafts for review.
You can also decide how much human oversight should remain part of the process.
For example:
- Vendors can send invoices directly to a shared AP inbox
- Employees can forward invoices internally for additional review before processing
- Teams can filter out reminders, statements, and spam before AI processing occurs
This flexibility helps organizations support existing governance requirements while avoiding unnecessary AI processing costs. Rather than requiring a major process overhaul, the Payables Agent acts as a practical, built-in automation layer within BC that helps reduce manual AP effort while still keeping people involved where review and validation are needed.
Once the Payables Agent is configured, the next step is where you often see the biggest operational impact: reducing the amount of manual invoice entry required from AP teams.
Reducing Repetitive AP Data Entry
After an invoice is emailed to the monitored AP mailbox, the Copilot Payables Agent in Microsoft Dynamics 365 Business Central automatically begins extracting and organizing invoice information, including:
- Vendor information
- Invoice numbers
- Invoice and due dates
- Line item details
- Supporting PDF invoice data
The agent also uses historical transaction data within BC to suggest:
- GL account mappings
- Coding patterns
- Similar invoice matches from previous transactions
For example, if invoices from a vendor were previously coded to office supplies or shipping expenses, the system can recommend similar mappings on future invoices without requiring manual setup or rule creation.
The process also supports scenarios where vendors are not yet set up in the system. In those cases, the Payables Agent can create a draft vendor record and stage it for review before it is approved for use. This helps maintain governance and vendor validation processes while still reducing manual setup effort.
Importantly, invoice drafts are not automatically posted. You still review, validate, and finalize invoice drafts before they become posted purchase invoices in Business Central. The goal is not to remove accounting oversight, but to eliminate repetitive entry work and improve consistency across AP processing.
While reducing manual entry helps streamline invoice processing, a significant amount of AP effort often still goes into validating that what was invoiced actually aligns with what was ordered and received. This step, often spread across systems, emails, and shared files, can slow down approvals and create unnecessary back-and-forth between AP, procurement, and operations teams. This is where three-way matching becomes especially valuable.
Three-Way Matching Without the Manual Back-and-Forth
The Copilot Payables Agent in D365 BC helps reduce this effort by automatically connecting the key pieces of the purchasing cycle, purchase invoices, purchase orders, and receipts, so they can be validated together instead of in isolation. When an invoice is received, the agent looks for related transactions already recorded in the system and brings them into a single, reviewable context. This allows you to confirm that what was ordered has been received and that what was received matches what is being billed, without manually cross-referencing documents across departments or systems.
In practice, this means that once a purchase order has been created and goods or services have been received, the incoming invoice can be automatically matched back to both records. You can then review the matched details, including quantities, pricing, and totals, before moving forward in the process.
Even with this automation, users remain fully in control of validation and approval. You can:
- Review matched invoices, purchase orders, and receipts in one view
- Confirm pricing, quantities, and completeness
- Investigate or resolve discrepancies before posting
- Finalize invoice drafts before sending them into approval workflows
This approach reduces invoice mismatches, speeds up validation, and minimizes the operational friction that typically occurs between AP and other business functions. Recent updates in BC have also continued to enhance matching accuracy and usability, making the process more reliable and easier to adopt without significant configuration effort.
As invoice capture and matching become more automated, the next step is ensuring that approvals move just as efficiently, without becoming a bottleneck in the process.
Extending Automation into Approval Workflows
This is where Power Automate plays a critical role by extending the Payables Agent process beyond invoice creation and matching into structured, automated approval flows. Instead of relying on static, manual approval chains, organizations can design approval logic that adapts based on business rules such as department, business unit, and invoice value thresholds.
For example, a common setup is an approval matrix that routes invoices based on:
- Business unit (e.g., home sales, industrial sales, corporate)
- Department ownership within each unit
- Invoice amount thresholds (e.g., under $2,500 vs. over $10,000)
This allows smaller invoices to be approved quickly by department managers, while higher-value invoices automatically escalate to senior leadership. In practice, this removes unnecessary approval steps for low-risk transactions while still maintaining financial control for higher-impact spend.
Power Automate also enables you to store and manage these routing rules in a structured way, often through a simple SharePoint-based matrix or similar data source, so approval logic can be updated without redesigning the workflow itself.
Once an invoice is ready for approval, the experience is designed to be lightweight for the approver. Instead of logging into BC, approvers receive a complete approval request directly in Outlook or Microsoft Teams, including:
- Invoice details and totals
- Purchase order and receipt references (supporting the three-way match)
- Any variances between PO and invoice amounts
- A clear approve or reject action
Approvals can also be completed from mobile devices, allowing decisions to happen in real time rather than waiting for users to return to their desktop. This flexibility helps reduce approval delays and keeps invoices moving through the system more consistently.
Importantly, approvers do not need a D365 BC license to participate in the process, which further reduces friction and expands accessibility across the organization.
Behind the scenes, Power Automate orchestrates the full approval flow, pulling invoice data, applying routing rules, and triggering notifications. It also allows organizations to introduce additional logic where needed, such as bypassing approvals when invoices match existing purchase orders exactly, or escalating only when discrepancies are detected.
The result is a more responsive approval process that reduces delays, minimizes manual coordination, and connects invoice automation directly into the workflows people already use every day.
As organizations look to operationalize invoice automation, the final consideration is often not capability, but cost, adoption, and how to start in a controlled way.
Cost and Adoption Considerations
The Payables Agent capability in D365 BC is included as part of the standard cloud offering, meaning there is no separate licensing requirement to enable the core functionality. In a similar way, most users with a BC license already have access to Power Automate capabilities for building approval workflows, and approvers themselves typically do not require additional licenses when interacting through Outlook or Teams.
The primary variable cost in this process comes from Copilot usage through consumption-based credits. These credits are used when the Payables Agent processes invoices, extracting and structuring data from incoming documents. Each invoice consumes a baseline number of credits, with additional usage depending on the number of invoice lines being processed.
In practical terms, this means cost scales with invoice volume and complexity:
- Lower-line invoices consume fewer credits
- Higher-line or more complex invoices consume more
- Organizations can expect per-invoice costs to vary based on usage patterns
Because of this, many organizations start with a pay-as-you-go model to understand real-world consumption before committing to larger credit packages. This allows you to validate volume assumptions and adoption patterns without upfront investment.
From an adoption standpoint, this is generally a lower-barrier entry point compared to broader AI or ERP transformation initiatives. However, it is still important for organizations to estimate invoice volumes, understand processing patterns, and run a pilot before scaling more broadly across business units.
The overall approach keeps adoption flexible: start small, measure actual usage, and scale only once the operational and financial model is well understood
Bringing It All Together: Start Small, Automate the Gaps
When you connect these capabilities, the goal is not to reinvent accounts payable, it is to make the existing process more efficient and consistent. The Copilot Payables Agent in D365 BC reduces manual invoice handling at the point of entry, while Power Automate ensures approvals and decisions move through the organization without unnecessary delays.
Rather than a large transformation effort, this approach works as a set of incremental improvements across the AP lifecycle:
- Automate invoice capture to reduce manual entry
- Improve invoice accuracy through system-assisted matching and suggestions
- Streamline approval routing using business rules (department, amount, business unit)
- Maintain human oversight where review and validation are still needed
Together, these capabilities help reduce friction between AP, procurement, and approvers, without requiring new systems or complex re-engineering of finance processes. Organizations can start with a narrow use case, validate results, and expand automation over time as confidence grows.
For many, the real value is not in changing how AP works, but in removing the repetitive gaps that slow it down and create unnecessary back-and-forth across the business.
Getting Started
If you are exploring how to implement the Copilot Payables Agent in D365 Business Central or extend AP workflows with Power Automate, Stoneridge Software can help you get started.
We can work with you to review your current AP invoice processes, identify practical automation opportunities, and define a realistic pilot approach. From there, we can also support.
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