Achieving accuracy and efficiency in your finance department through invoice automation!
Cost reductions, improved efficiency and better allocation of resources are just some of the savings that can be gained by implementing automated invoice processing.
Accounts Payable if done manually can be time consuming, complex, prone to error and provide any number of challenges for an organisation particularly the finance department. Manual processing includes receiving invoices by post, fax or email which are then categorised.
Invoices will be then forwarded to the person responsible for the invoice for checking and then matched to a purchase order number assuming the person has created one; the invoice may then require further authorisation from senior management.
Finance departments are challenged with needing to cut operational costs whilst at the same time ensuring invoices are paid on time so as not to upset the supplier-company relationship.
Efficient invoice processing can be achieved by implementing an automated invoice processing solution.
Accounts Payable Issues
Typically the following problems hinder the accounts payable process:-
- Collating invoices that come from different suppliers or cost centres, in many different layouts and delivery formats – post, fax, email
- Labour-intensive processes required to input data can be complicated further if linked to different cost centres and/or involve currency conversion
- Errors associated with manual data entry
- Longer lead times due to manual routing, processing and sign-off procedures involving individuals in different departments and possibly different countries
- Inefficiencies due to time spent gathering physical documents in order to match invoices with purchase orders, delivery notes, contracts and accounting system records
- Inability to maximise financial benefits associated with payment schedules such as discounts for early payments or fees for late payments
- Risk of document loss or damage as documents are received at multiple input points and may be routed or classified incorrectly
- Costs associated with manual document routing, shipping, couriers, storage, archiving and auditing
- Inability to easily audit invoice processing and payments to match up document flow with the accounting system
Automating the invoice process will lead to more efficient working practices. With the added benefits of cost reduction in paper handling, time savings and increased security in proper invoice management will ensure your accounts payable process is streamlined.
Why automate Accounts Payable?
The current economic and competitive business climate makes it crucial to running your operations efficiently. When looking at efficiency, most organisations have already solved the issues surrounding their structured operational data by implementing CRM, ERP and Accounts business systems.
According to Gartner, up to 80% of business data transactions and records are in an unstructured format made up of paper, fax, email and office documents. Nowhere is this more prominent than within the Accounts Payable department. If a business wants to significantly reduce costs and at the same time become highly efficient then the AP process is a good place to start.
Benefits of automating your invoice processing:
- Can reduce the cost of the process by up to 75%
- Ensures control and compliance
- Timely and accurate reporting within the accounting system
- Ability to access prompting payment discounts and avoid late payment penalties
- Eliminates ‘lost’ invoices during approval process
- Improved staff morale and ability to focus on core business tasks
What are the stages of automated invoice processing?
- Capturing purchase orders and/or delivery notes
- ICR of invoices, Invoice Scanning
- Document matching, Invoice Processing
- Exception handling
- Approval process
- Updating Accounts systems
- Document archive
Month end closing processes are more often than not time consuming and complex. Removing omissions, improving speed and identifying redundant processes is possible through a financial reporting solution.
Want to find out more?
Our solutions are not substitutes for your current systems as they work in conjunction with your existing infrastructure. To find out more about how automating your AP and AR process will save you money fill in the form below and one of our advisors will call you.