Optimize Cash Flow with AI-powered Accounts Payable Solution

Accounts payables refers to a process of paying liabilities and bills your business owes to suppliers and vendors. Understanding your accounts payable process and analyzing the cash flow is essential for any business. Let us quickly look how accounts payable automation streamlines and optimizes your business cashflow.

Understanding the Accounts Payable Process

Accounts payable is considered crucial for many reasons, especially for the cash flow to be noted. The accuracy of your company’s finances depends on your accounts payable process. The efficiency of the accounts payable process can affect the cash position and supplier relationships.

Accounts Payable

As your business grows, it is essential to monitor your accounts payable process on a day-to-day basis. Small businesses can capitalize on early-payment discounts and settling credits through inventory processes.

The following are some of the best practices that ensure your business operations run smoothly:

Maintain Preciseness in Accounts Payable Process

It is always better to have a detailed accounts payable log in case of payment disputes. This acts as proof as supporting documentation for outstanding invoices during tax time. All these accounting reports must be generated manually or with an accounts payable solution.

Automation

SutiAP automates and simplifies the accounts payable process. The solution can monitor payments and control access to your financial data. Businesses can mitigate risks and accelerate the accounts payable process by simplifying the core tasks of the finance department.

Verification & Validation

Managing accounts payable requires verifying and validating each invoice for accuracy, billing, and payment date. Invoice details need to be entered accurately into the general ledger for accounting. Employing accountants and bookkeepers can ensure accuracy throughout the process.

Original Invoices

Today, almost all invoices are dispatched electronically to avoid errors and confusion. Therefore, businesses started using invoice software to organize invoices as they received them. Invoices will be auto-captured and read through OCR technology, so there will be no scope for data errors.

Input Every Invoice

Input every invoice you get from the supplier carefully into the system. If a dispute arises, you can locate each invoice quickly within your system. You can also merge multiple invoices into one for making a document if required. This way, you can track any document in a matter of minutes.

Invoice Approvals

Approval from the appropriate person should be made mandatory to process an invoice for payment. Choose a solution that supports multi-level approval workflows and configures approvers based on their roles. Approver workflows should work by role and seek appropriate approval before sending an invoice. An apparent approval and invoice entry procedure makes the process transparent and accessible.

Invoice Naming Convention

Ensure you follow the same naming convention for invoice entry in the system. Maintain consistency each time you assign an invoice number in your system. Having a method that works for you, such as labeling invoices with the company name, month, and year.

Early-payment Discounts

Vendors offer discounts on the invoice amounts, usually a percentage of the total due amount, in return for receiving the payment. Choose an AP system that allows you to identify, flag, and pay invoices with discounts at a quick turnaround time. The system should allow you to make the most of discounts offered by various vendors so they can always leverage better deals.

Benefits

Lower Processing Times

Ideally, the typical accounts payable process requires the team to input invoices into the system manually and send for approvals, which would take a lot more time. Moreover, they must ensure accuracy to avoid potential errors slipping through the cracks. All these processes take a lot more time and increase the chance of late payments. This can ruin supplier relationships and make it difficult to continue working with any business.

Automation can help you eliminate manual activities requiring lengthy processing times. Accounts payable solutions can simplify most menial and repetitive processes and handle multiple tasks simultaneously. This would reduce the time it takes for an invoice to get processed, as the whole thing would flow more smoothly.

Monitor Paper Documents

Managing paper invoices can be challenging, especially when dealing with multiple vendors. Moreover, the paper-based invoice process doesn’t help in audit trials as you may lose some information at times.

When invoices are managed through the system, you can always find them with just a click. As all the information is stored in the system, data can be retrieved in just a few clicks. Having robust accounts payable software offers the transparency needed in your cash flow process, enabling you to make better business decisions.

Choosing AI-powered accounts payable solution such as SutiAP offers numerous benefits, including improved efficiency, accuracy, security, and cost savings, making it a compelling choice for businesses looking to optimize their AP processes.