What is OCR in accounting?

Traditional OCR recognises characters, then template rules locate fields by position: the invoice number top right, the total bottom right. That works for regular suppliers with consistent layouts but breaks when layouts change, which is why older capture tools needed templates per supplier and manual checking. Current tools add machine learning and language models that understand the document rather than its layout, so they can find the total or the VAT number on an invoice they have never seen, read line items and handwriting, and give a confidence score per field. Digital PDFs often skip OCR entirely because their text can be read directly, and structured e-invoices need no reading at all. OCR quality still sets the limit for touchless processing of scanned paper. Dext reads receipts and invoices for bookkeepers, Expensify and Pleo read receipts on card spend, and DataSnipper reads audit evidence.