Businesses aim for efficiency and quick returns in their day-to-day processes. However, not all companies have caught on to the shift from paper processing to technological methods. Most workplaces do not reflect the advances that automated programming has brought and continue to spend significant time and money on handling accounts payable with manual systems.
Many workplace tasks result in high personal productivity without benefiting the overall company simply because they have been assigned unnecessary manual tasks and remain busy. This results in an annual amount of approximately one million hours wasted on redundant engagement without meaningful contribution. Converting to automated accounts payable (AP) processes eliminates a substantial amount of busy work to boost high functioning companies.
The process of accounts payable often results in asking for additional information before approval or inquiries are returned, which means delays are normal. While additional information is a fair request, you can alter other factors for optimal operational time. Cut out the processes that keep your business from using your hours wisely and boosting efficiency.
So, how do you decide which accounts payable processes to automate? The top AP processes to automate are those that can be streamlined, handled by automated software and utilized on cloud storage. Check out the areas where you can implement AP processing below.
Your company's interaction with suppliers may differ, and your policies on accepting invoices may cover a broad framework of formats. Especially if paper files and other outdated processes are a part of your system, the arrival of invoices and the subsequent sorting may be tedious. Convert the handling of invoices into the automated sequence to save employee time and effort.
Even if you have a digital framework, your suppliers may not all send you one type of file. One entity may think the best way to send you an invoice is in PDF format, while another gives you a DOCX or JPG format. You will end up collecting diverse file types — and possibly unsupported versions of them. Receiving an array of files and extending the task of sorting them to an employee further complicates the problem.
Rather than sticking someone with this busy work and receiving all kinds of files without a viable organizational approach, let this be your first step in automating the AP processes. Take out the option for paper invoices, and simplify the organization of invoice files by taking on a data capturing system. Incorporating the invoice portion of the AP process into automation will bring momentum to the rest of the operation.
Once your invoices have been received and sorted by a data capturing system, there is no need for employees to manually input the data they hold. Data entry does not need to be a monotonous procedure that fills up time. Recording data can instead be done with tools like optical character recognition, adaptive learning and intelligent character software.
Human error in manual data entry creates serious problems. Although many studies have attempted to solve manual data entry issues, double entry and visual checks do not compare to the reduction in errors that automated data entry achieves. According to the most recent data, optical character recognition reaches 98.69 percent recognition accuracy for handwritten text and other fonts.
The data collected with character recognition — invoice details, supplier information and order amounts — can also be input into your document storage, accounting software or cloud system. Indexing data is one important move to speed up approvals and coding. The captured data is stored for security and can be retrieved, making this portion of the AP process timely and accurate.
To reduce errors even further, invoice information is matched with previously stored details about the supplier and other transactions with them. The documentation between an organization and a supplier will be filed, too, so reports, order forms and notes are all located in the same secure place. The technology will then examine these supporting documents so that name spellings, account numbers and invoices all align. Your AP processes will have additional consistency because of the automatic validation.
Automated processing can also authenticate invoice information by comparing the data with previously input data. Establishing a new supplier profile if no data is available is another productive part of this system. It also prevents duplicate suppliers from being recorded, so your AP process does not result in extra payments. Data matching helps you tidy up mismatched formatting and avoid confusion.
Systematically verifying crucial information about suppliers and purchase orders will create better supplier relations. The engagement with vendors will be limited if electronic accounts payable processes work efficiently, and dissatisfaction will decrease because of the attention to detail and productivity in this framework. This AP process is expedited when imported data can also be validated.
AP processes cannot continue without routing, the series of approvals that must be gained before payment can occur. Several employees who are assigned different responsibilities may be included in the approval process with unique levels of involvement, and administration or management must authorize their actions.
Avoidable hindrances could move the approvals in AP processing along if an automated system prompts the correct employees for their review of the information. Electronic routing does not require anyone to run around a company gathering signatures. The same level of attentiveness can be applied to an invoice without disrupting the work of others for significant periods.
Strategically increase the efficiency of payment confirmation without stopping by every department that contributed to the decision. Each department may still receive a notification to approve the order so that the appropriate parties can catch any missteps. Documents can arrive for the right person immediately without the hassle of misplacing them or divulging their confidential contents to the wrong parties. Accounts payable processes do not have to constitute an excessive cycle time to have little to no discrepancies and the proper authorization.
Tightening the approval and routing time in accounts payable is only a fraction of the performance improvements your business can make. The workflow process addresses everything from routing to posting and line extraction to verification. Assigning productive tasks to employees will improve the functioning of the organization.
Cutting out needless manual steps for employees is not the only application of automation. Automated task assignments can also free management from time-consuming planning and repeatedly alerting employees about their responsibilities. As you set your specifications for automated workflow and accounts payable software, your internal communication improves and your accounts payable cycles complete more quickly.
If automated management is used for accounts payable, then financial matters will be protected through ordered assignments and duties. Recorded requests for reviewing each segment of the process will be a way to hold workers accountable and monitor their responses to requests. Because the assignments are automated and stored, your business can be more resilient against potential fraud.
Automatically keeping supporting documents in web-based storage will protect you during auditing, give you regular access to important files and save you office space. Keep your records for seven years, but storing paper versions of these files is impractical if your business deals with many accounts payable. Web-based storage doesn't even take up space on your computer, and using the Cloud is an accessible option to retain transaction documents.
Paper files cost money to keep and use. For every 30 copies employees print, 39 percent are discarded in the garbage. Opt for a more valuable, reachable and cost-effective storage option with the Cloud. Multiple parties in your business can access the same file at the same time if it is necessary, which means they're not spending time spent making copies or passing around files.
Eliminating paper invoices is a goal for many organizations, but most of these businesses have not made the transition yet. For differing reasons, they have delayed a vital switch, which affects invoice delivery and other document handling. Much of the invoices received by an organization will result in an inquiry. Rather than flipping through folders and filing cabinets or making long walks to deliver thick stacks of paper, you can reference the archived files on the Cloud.
The Cloud holds information your business can pull up with a few clicks. Fewer files will be lost when the archives are automated and digital. This method of archiving is cost-effective and provides more security, less data loss and offers more office space. Maximize your accounts payable processes and join the web-based filing system of the Cloud.
General Ledger coding includes many variables of numbers that a business must code when processing invoices and before posting accounts payable. Many classifications go into GL codes, like supplier and invoice group, and the financial reports reflect these codes and amounts. Several factors like expenses, revenue and liability are included in the GL.
Depending on the number of invoices your business has, your own GL codes can end up being a large list and hard to keep track of manually. However, automated systems can make the posting process of accounts payable more doable. Automated coding can save you or your employees a considerable task of regulating these codes and precisely reporting them.
The end product of GL coding results in the master data. When your master supplier file is ready, it will be a useful reference for taxes and financial purposes, because it compiles your transactions in one sizable resource. Because your supplier information will be verified and relatively error-free, sharing your master data with your financial team should be a stress-free process. Each choice to automate these processes will affect the other steps in accounts payable. The efficient and standardized practices you have implemented will make financial checks and paying taxes an achievable task.
Your business should be able to present proof of internal controls, and automated AP processes are a valuable method of showing your compliance with regulations, maintaining financial records and meeting payment goals. When evaluating your internal control system, consider whether an automated accounts payable transformation will alter how your finances run.
Automation is a safeguard against fraud because it establishes procedures that help ordinary processes gain momentum, but it warns if any requests or payments seem questionable and exceed the set standards. After they flag these payments, your financial team and administration can work out whether these transactions are genuine. It also presents a way to track payments through invoices and supporting documents and gives your company confidence if audits arise. Internal controls reflect well on your company.
It also allows you to make payments earlier and quit disrupting accounts payable cycles. Internal controls show that your business avoids waste and that individual efficiency is high. If you automate payments, then any wasted time and money will be eradicated. Your accounts payable cycles will turn out more advantageously with internal controls in mind.
Keeping track of suppliers may require more effort than your company wants to put forth, and with automated AP processes, vendor contact can be simplified. Creating a portal for vendors to access and input their own information doesn't have to involve extensive time and money, but it does open up the opportunity for suppliers to present all the needed information up front.
An onboarding system gives the supplier the chance to communicate details and enter your automated system without difficulty. They can verify payment specifications, compile tax details and add an identification number to their business. Onboarding services can make the records more accurate through automated verification so that when invoices come, the process is even more polished and able to conserve time.
Your suppliers' support will be the way that automation will continue to work smoothly, so try to generate feedback from your vendors. Feedback can go both ways in this communication tool, so provide your supplier with useful information. Digital invoices will benefit you and your supplier via your portal. If your portal includes an electronic invoice submission option, then you can exchange documentation like this with ease.
If your vendors can send you their invoice online, then you both can check up on the progress of the accounts payable completion. This is also a secure way of delivering information and payments. Using online invoices is a rising trend called e-invoicing. As e-invoicing continues to grow, you can enjoy the technological advances and the reduced delays while implementing accounts payable automation best practices.
Your accounts payable processes can be automated for a more efficient and satisfying system with Artsyl's technology. We use DocAlpha to spare your business any wasted time and cultivate exceptional supplier interactions. This software rapidly and cost-effectively reduces errors and inconvenient manual work. Automation can maximize your accounts payable processes without making you labor over coding or design elements.
DocAlpha extracts data from your invoices while the Cloud stores vital supporting documents. Additional solutions can complement these. Our technology analyzes and indexes your data, so you can easily access it.
Automate AP processes with these best practices and technology from Artsyl today. Get your demo of our automated technology now.