Automation is one of today’s mega trends affecting workforces globally. As a finance leader, it’s important to understand what automation can mean for your department and bottom line. The accounts payable (AP) function in particular has traditionally been slow, manual, and paper-based. From entering and coding invoices to circulating documents for approval and paying vendors, there are many AP processes that can benefit from automation. These may be some of the reasons that 74% of companies are planning to adopt AP automation in the next three years.
One of the more obvious benefits of AP automation software is that it helps reduce manual data entry and paperwork, which saves time and reduces errors. But what are some other reasons you should consider AP automation?
Speed up the ability to pay vendors
AP automation software can cut the time it takes to process an invoices from 20.8 to 3.8 days. This translates into the option to pay vendors faster, allowing you to capture supplier discounts and avoid late payment penalties. Depending on how you pay your vendors, there are other advantages available. By automating check payments, you can save time that would be otherwise be spent printing, signing and mailing checks out. On the other hand, you could replace checks altogether with fully integrated electronic ACH (or EFT) payments. Virtual credit cards are also rising in popularity, which allow you to earn cash back on purchases.
Improve visibility of your accounting team’s activities
With electronic AP, there is only one version of the truth. Invoices can no longer sit on an approver’s desk, out of sight and out of mind. AP automation solutions increase transparency by letting you track the activities of each user, and see exactly when invoices were submitted, received, and approved. You can also run reports and see if invoices are typically getting stuck by a particular employee. These solutions can help distributed teams collaborate easily in a centralized system. Freeing your staff of manual, redundant tasks can help increase their job satisfaction and redirect their time to more valuable, strategic work.
Stay compliant with an electronic audit trail
AP automation software provides a searchable audit trail of all your invoices and payments. It reduces the chances of lost paperwork and manual errors. This can help with regulatory compliance for annual or quarterly filings. For multiple legal entities, the software can also deliver a centralized system where invoices are stored, even if different ERP systems are used across legal entities.
Help prevent vendor fraud
With 78% of organizations affected by some form of payments fraud, CFOs need to take measures to safeguard payment processes. Accounts payable automation software can help by carefully controlling which employees can approve invoices and release payments. Approval workflows that involve multiple people increase the chances of catching a fraudulent invoice before it’s paid out. Tighter control of user credentials.
Increase visibility into the data to make better decisions
According to an Aberdeen report, one of the top AP challenges is the need for real-time availability of data. With AP automation software, you can gain real-time insight into payables and AP workflow, such as where invoices currently sit within the approval cycle. Some AP solutions are cloud-based and offer a mobile app, allowing you to access this information from anywhere. If you have more than one legal entity, AP solutions like Beanworks can give you a holistic view of payables across your legal entities.
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.
Learn how the CFO of Trailer Wizards, a national transportation company, benefits from Beanworks AP Automation.