An apparatus (10) is provided for sorting a group of documents contained with an envelope into selected batches of documents. An envelope feeder (15) feeds a group of envelopes containing documents onto a document transport (75). A document extractor (50) positioned along the path of movement extracts the documents from the envelopes. A system controller (95) identifies the documents extracted from each envelope as a single transaction. An orientation detector including a magnetic image reader (135) and an optical image reader (140) determines the orientation of selected documents. A document orientor (145, 150, 170) changes the orientation of documents into a desired orientation. A document feeder selectively feeds batch identification pieces. An image acquisition device (230) acquires an image of the batch identification pieces and selected documents conveyed along the path of movement to enable the system controller (95) to assign documents of selected transactions into selected batches. A document sorter (300) sorts the documents of respective batches into selected output areas.