A key trend impacting global workforces today is automation. As a CFO, understanding how automation can benefit your organisation and your bottom line is vital. The accounts payable (AP) process has traditionally been a slow, manual, and paper-based function within most businesses. From data entering and coding invoices, to manually distributing documents for approval, there are numerous phases of the AP processes that can benefit from automation.
Below we’ll discuss 5 reasons why 76% of Australian companies who are yet to implement any automation into their AP process, may plan to adopt AP automation into their organisation over the next three years.
The most obvious benefit of invoice processing automation software is that it helps reduce manual data entry and paperwork. This saves time, reduces errors and increases company profitability. But let’s look at some other reasons why you should consider invoice processing automation?
- Increased visibility of data leads to better decisions
According to an Aberdeen Group AP/AR Benchmark Study report –https://www.nebula.co.za/2016/02/24/aberdeen-research-update-reap-the-benefits-of-invoice-excellence-with-ap-automation), the need for real-time availability of data is one of the top AP challenges.
With AP automation software, and especially cloud-based SaaS platforms with strong mobile technology, you can gain real-time insight into your AP workflow process. This allows you to see where invoices currently sit within the approval cycle, at any time, from anywhere in the world.
- Benefit from early payment discounts
AP automation software can cut the time it takes to process an invoice from 20.8 to 3.8 days (https://www.allbusiness.com/top-5-advantages-of-automating-your-ap-invoice-processing-10813-1.html). This allows you to take up the option to pay suppliers faster, and in doing so take advantage of any early payment discounts that may be on offer. Or simply to avoid late payment fees.
- Mitigate the risk of succumbing to payment fraud
In 2017, the Association of Finance Professionals reported that 78% of organisations experienced attempted and/or actual payment fraud. CFO’s need to ensure their business is taking all measures possible to ensure they are not a victim of this growing trend.
Accounts payable automation software can help safeguard an organisation by carefully controlling which employees can approve invoices and release payments. Invoice approval workflows that involve several approvers across the business offer an organisation tighter control and increase the chances of catching a fraudulent invoice prior to it being paid.
- Improve visibility of your finance team’s activities
Invoice processing automation solutions increase transparency within your finance department by letting you track the activities of each user. Seeing exactly when invoices were submitted, received, and approved.
Full analytics reports can be run, highlighting the performance of each individual. The benefit of this type of reporting, and even benchmarking of users against the wider team, allows you to quickly identify if one team member is shouldering more of the responsibility. Highlighting this trend early with accurate analytics enables an organisation to distribute work evenly to avoid bottlenecks at a later period.
Freeing your staff of manual, redundant tasks can help increase their job satisfaction and redirect their time to more valuable revenue generating tasks.
- Stay compliant with an electronic audit trail
AP automation software provides a searchable audit trail of all your invoices and payments. Every touch point along the life of an invoice once it has been received into an organisation is tracked and recorded. It reduces the chances of lost paperwork and manual errors. This can help with regulatory compliance for quarterly or annual reporting.
Most AP automation platforms will also provide full document management capability, where invoices are stored securely based on required timeframes. These records can be automatically destroyed at a set date after their required storage life, and a certificate of destruction produced to certify this if required.
AP automation software is the next must-have accounting solution for savvy CFOs and finance leaders. In addition to saving time, improving insight, and preventing losses, automating AP will allow your accounting processes to scale easily as your company grows.
If you’d like to understand how AP automation could benefit your business, please feel free to contact Bryan Murphy directly on firstname.lastname@example.org