Six Ways Accounts Payable Automation Transforms Your F&A
Accounts payable management is a critical part of any business, but it can often become tiresome and expensive due to significant labour costs and manual processing of data. In such business scenarios, automating the accounts payable process is often considered as a go-to measure.
Many organisations, however, find it discomforting to fully automate their AP functions right at the start. In such cases, it’s a good idea to begin the automation process by capturing all invoices or bills into a centralised repository like an AP automation platform. With the help of modern technology, AP automation can enable automatic and accurate entry of bills into a central system for complete visibility into the invoice lifecycle.
Automation can also enable businesses to have full control over their procure-to-pay (P2P) management by creating digital audit trails that track every step, invoice change, communication, and approval associated with an invoice. Further, AP automation can solve numerous bottlenecks caused by manual processes, in turn increasing one’s accounts payable efficiency.
Let’s look at six ways in which automation can transform your accounts payable processes:
Decreases processing costs: Automation can save a tremendous amount of time and money that’s otherwise lost while carrying out processes manually. A 2015 survey carried out by APQC, gained insights into how significant the difference in costs can be, with top performers spending just under $5 per invoice and the lowest performers spending $12.44. The survey also found that manual intervention typically consumed 62% of total AP costs, which can be reduced substantially with automation. To add to that, manual processes also increase chances of human errors. With accounts payable automation, businesses can focus on their core functions while eliminating the chance of errors.
Lowers accounting risk: With automation, businesses have better visibility into the approvals and payments workflow. Therefore, common risks and fraud, such as false billing, duplicate payments, and fraudulent transactions, can easily be tracked within the system. Businesses can gain requisite audit controls as the AP automation software flags duplicate invoices, extra charges, or any suspicious activity. Thus, you’ll be protected from common risks, such as phishing scams, duplicate payments, and unapproved vendors.
Greater security: Concerns over security is a major roadblock for businesses when it comes to automating their AP process. However, it’s important to note that online and cloud security has developed rapidly over the last few years, thereby ensuring better security and minimal risks. It’s also vital that businesses adopt the right cloud security technology – keep an eye out for ISO accreditation as it will give you further peace of mind.
Enhanced collaboration: Automated systems don’t necessarily remove the collaborative aspect of a process like accounts payable. In fact, invoice systems permit multiple individuals to collaborate on any particular payable in real-time. This ensures that any stakeholder, no matter when or where they are situated, can simultaneously access an invoice to confirm or dispute charges, seek clarification, or explain discrepancies.
Electronic audit trails: Automated systems are extremely useful when it comes to audits. Electronic audit trails make tracking an invoice from receipt to payment a breeze. It also makes it easier to detect accounts payable fraud. With automated systems, business can further improve their AP process by going digital and can electronically archive their invoices. Not just that, automated systems also make it easier to search and retrieve files. Additionally, digital archives provide easy access to invoice approvals and can aid businesses to comply with compliance or regulatory requirements.
Cloud-based accounts payable: With the cloud, users can access the AP system from anywhere. This allows critical information to be centralised and present on a single platform for all legal entities. Furthermore, enhanced visibility will allow business leaders to get insights into how efficiently the process is running.
Implementing AP Automation with QX
QX is a leading, UK-based finance and accounting service provider working with businesses across industries in the UK and US, amongst other markets. Technology and automation make for a key element of our unique people-process-platform approach. We work closely with our clients to understand their specific organisational needs, devise customised tech stacks and ensure AP transformation through a seamless shift to revamped systems.
Partner with QX to get the support you need for transforming your accounts payable function. Contact us to set up a free, no-obligation consultation now.
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