Automation to Sort out Accounts Payable Challenges
With costs skyrocketing these days, time-consuming tasks such as invoice management and accounts payable operations should be automated. Automating all the tasks including data entry makes invoice management and accounts payable more efficient. Automation makes it easy for accounting departments to stay on top of expenses and control back-office functions by alleviating the repetitive tasks.
When old fashioned systems are used, streamlining invoice processing would take-up more time. Key factors that contribute to increased invoice processing times include:
Data Entry
Entering the data even for a single invoice takes several minutes, and this may take more productive hours if it is to be done for more invoices. With other pressing tasks to do, finding the time for data entry is a big deal.
Approvals
Sending paper invoices for approvals would result in significant delays. The following are various areas where approvals may take time:
Vendor payments
A single payment does not take much time; however, when they are multiple checks to be processed each week, capturing early payment discounts takes a lot more time.
Reconciliation
Statement reconciliation is the best practice, but many organizations may skip this step for most vendors as it is time-consuming.
Exception handling
Exceptions are common in invoices; and based on the complexity, there will be a resolution that takes several days. Technology that automatically processes invoices and manages the accounts payable process enables you to stay ahead without investing more time on low-value tasks.
Invoice volume
Invoice volume keeps growing in any organization, and at times it becomes difficult to manage. Every firm receives more invoices, works with more vendors and has to reconcile all the statements they receive. As invoice volume continues to increase, the accounting department will have more invoices to manage. Accounts payable software can easily manage the scaling invoice volume, and operations, without increasing the burden to the accounting department. By eliminating manual work, improving workflow efficiency and making back-office operations transparent, AP automation optimizes accounting processes.
Delivery
Tracking invoice due dates and bill payments require you to log into multiple software systems. Electronic invoices can improve the filing and storage and alleviates the difficulties in processing and managing invoices that arrive in different formats. AP software organizes all your invoices – including paper from a single interface.
Invoice errors
Hours are spent on tracking errors, and it takes weeks to identify duplicate entries. Errors would result in overpayments and make the process inefficient. AP software uses validations to monitor the accuracy of data and warns about duplicate payments.
Errors from supplier-invoices are more challenging to manage than internal mistakes. This is where AP automation can help. Instead of relying on complicated spreadsheets, automation can help capture data better and produces detailed reporting. Instead of recording transactions, accounts payable software enables you to drive insights into cost savings.
Invoice Processing
Getting an invoice from receipts to processing is time-consuming. By eliminating manual data entry and streamlining the approval process, automation can easily cut invoice processing times without employing more number of bookkeepers. By leveraging accounts payable automation, organizations can upload invoices from their location, process and get them approved in a few hours. This enables real-time cost reporting and allows businesses to improve their bottom-line proactively.
Efficiency is all about cost cutting – costs go high when there are errors, exceptions and late payments. With a series of tasks configured in accounts payable software, many of them can be automated, leaving the most complicated work to be done manually.
