The shoebox problem
Every accounting firm has them: clients who show up with a shoebox (or grocery bag, or envelope) full of crumpled receipts. Maybe it's a quarterly drop-off, or worse, an annual tax-time dump.
Manually processing these receipts is painful:
- Sorting by date and vendor
- Deciphering faded thermal paper
- Entering amounts into spreadsheets or accounting software
- Categorizing each expense
- Chasing clients for missing receipts
For a typical client with 50-100 receipts per month, this can take 2-4 hours of staff time. AI-powered receipt extraction can reduce this to minutes.
Before vs After AI Receipt Processing
Manual Process
-
Sort physical receipts -
Type each amount manually -
Look up vendor categories -
2-4 hours per client/month
With AI
-
Snap photo or forward email -
OCR extracts all data -
AI auto-categorizes -
15-30 minutes review
How AI receipt extraction works
Modern receipt extraction tools combine two technologies:
OCR (Optical Character Recognition)
Reads text from images. Identifies the vendor name, date, amounts, tax, and individual line items on the receipt.
Machine Learning
Learns from past entries. Remembers that "Tim Hortons" is always "Meals & Entertainment" and auto-categorizes future receipts.
The leading tools claim accuracy rates of 95-99% for well-photographed receipts. The remaining errors are typically from faded receipts, unusual formats, or handwritten notes.
Tool comparison: Dext vs HubDoc vs AutoEntry
The three leading tools for accounting firms are:
Dext Prepare
4.8★ on XeroFormerly Receipt Bank. Now owned by IRIS. Most feature-rich option with AI-powered categorization and extensive integrations.
Best for:
Established firms with high document volumes
Pricing:
Per-client model, from ~$20/client/month
HubDoc
Free with XeroOwned by Xero since 2018. Included free with Xero subscriptions. Handles basic document capture and bank statement fetching.
Best for:
Xero users with basic needs who want free
Pricing:
Free with Xero, or $12/month standalone
AutoEntry
4.7★ on XeroNow owned by Sage. Credit-based pricing suits practices with lower document volumes. No long-term contracts required.
Best for:
Solo bookkeepers, small practices with variable volumes
Pricing:
Credit-based: ~$15/month for 50 documents
| Feature | Dext | HubDoc | AutoEntry |
|---|---|---|---|
| Line-item extraction | |||
| Auto-categorization | |||
| Bank statement fetch | |||
| Free tier | With Xero | ||
| Best for | High volume | Xero users | Flexibility |
Step-by-step setup (Dext example)
Here's how to set up Dext Prepare for a new client:
Create a Dext account and add the client
Sign up at dext.com, then add a new business/client. Connect their accounting software (Xero, QBO, etc.).
Set up the email inbox
Each Dext account gets a unique email address (e.g., clientname@dext.cc). Forward receipts or invoices to this address and they're automatically processed.
Install the mobile app for your client
Have the client download the Dext app. They can snap photos of receipts which are instantly uploaded and processed.
Configure categories and rules
Set up your chart of accounts mapping. Create rules like "Vendor contains 'Staples' → Office Supplies". Dext learns from these rules.
Review and publish
Review extracted data in the Dext inbox, make any corrections, then publish to your accounting software with one click.
ROI calculator
Estimate your time savings with AI receipt processing:
0
Hours/month (manual)
0
Hours/month (with AI)
$0
Monthly savings
Best practices for accuracy
To get the best results from AI receipt processing:
- Train your clients: Teach them to photograph receipts flat, well-lit, and in focus. Crumpled or shadowy photos reduce accuracy.
- Process regularly: Don't let receipts pile up. Weekly or bi-weekly processing keeps the workflow manageable.
- Set up rules early: The more categorization rules you create upfront, the less manual review needed later.
- Use email forwarding: For digital receipts (e.g., Amazon, SaaS subscriptions), set up automatic email forwarding to the Dext inbox.
- Review before publishing: Always do a quick scan of extracted data before pushing to your accounting software. AI is good but not perfect.
Beyond receipt extraction
Resolved by TideSpark goes further—it extracts receipt data, categorizes expenses, and maps directly to GIFI codes for T2 preparation. Book a demo to see the difference.