Top 3 Ways Your Organization Needs To Automate Accounts Payable
Accounts Payable plays a crucial role in business operations at any organization. The primary function of an AP department is to ensure that all the official invoices from the vendors are approved, processed, and paid.
However, the sad truth is that the manual process slows down the payment cycle from achieving something more than only getting the bills paid on time or late.
Many business owners only focus on increasing revenues and reducing production costs, instead of understanding the necessity for automating the accounts payable processes.
But automating the AP process streamlines the invoice processing, payment procedures, and the approval workflow of your organization.
The benefits of automating accounts payable process are as follows:
a) Invoice Approval
Invoices need to be approved by the head of the department at your organization, arriving through email, fax, or from a vendor website portal. Collecting approvals involves managing dozens of emails, delivering them, and also following up with any outstanding approvals.
But this process can turn out to be extremely difficult, as sometimes locating invoices for approval can take a lot of time. Automating this process eliminates human intervention, unless necessary.
The approver can receive invoices automatically, along with the automated follow-ups where they can be reminded about any upcoming deadlines.
b) Automate Data Entry
Entering the data manually, not only takes days to complete, but also opens an avenue of errors. The process is time-consuming, expensive, and extremely monotonous.
By automating the process of data entry, there is no need to upload an excel spreadsheet.
After the data is identified and captured from the invoice, the financial accounting system can verify, validate, and match invoice data. Once verified, the data is uploaded automatically into the accounting system, requiring no manual effort.
c) Digital Archives
Copies of the paper-based invoices have a tendency to get lost, damaged, and take up valuable space in your office. So, by automating the accounts payable procedure, the invoices are captured and processed completely in a digital format ensuring that even if the invoices are misplaced, they can be found via open text searches. This also greatly reduces the risk of the documents getting lost or damaged.
The Bottom Line
A complete automated accounts payable workflow covers all the processing steps starting from arrival to the final payment which includes supplier invoicing, capturing, checking price, verification and routing, payment.
The manual accounts payable process can involve lost invoices, longer processing time, faulty payments, and unintentional human errors. So, an automated system will solve all these issues and allow you to process the invoices quickly.
