Common AP Tasks Your Organization Should Automate Soon
Accounts payable tasks can turn out to be time-consuming and ineffective in financial processes without automation. Today, many AP departments still need to key-in invoice data manually.
They are spending valuable time printing paper checks, mailing payments, filling paper records, chasing down signatures, and more. Also, they must monitor and calculate the financial details include applicable discounts on Excel sheets.
Not only do performing AP tasks take time, but they can also cost lots of money and could leave the process prone to errors. Automating AP tasks such as entering data, payment execution, invoice matching and approvals help you continue your vendor relationships which could aid you in preventing these common AP problems.
1. Data Entry
Entering data manually pretty much guarantees you will end up with some errors. Even worse, these errors can leave a big impact on your business. Adding an extra zero or moving a decimal point into the wrong place can throw off your books by hundreds or even thousands of dollars.
If your employees take the time to check every entry manually, not only is this extremely time consuming, there is still no guarantee they will catch any mistakes.
Automated AP solutions take in information directly. Either they leverage the data by capturing technology in order to turn paper documents into digital files while also automatically capturing details from electronic invoices. These solutions can cut back on errors with higher accuracy and will automatically check for irregularities.
2. Matching and Approving Invoices
Before paying an invoice, you must confirm it is legitimate. A solution will indicate when it receives every invoice and when it was approved by a manager, then automatically matches them to the correct purchase order.
Performing all this manually can be a nightmare, filtering through email threads, dealing with lost paperwork, finding each individual PO/invoice checks, and moving it around through the workplace to follow up with approvals.
In an online AP software, invoices are quickly matched to their PO without any human intervention. The only exception is when invoices require manual processing and if they need approval, the solution sends it directly to the correct approver.
Also, it will send automatic follow-up reminders if nobody has approved the invoice within a certain time frame.
3. Vendor Relationships
Employees can lose time dealing with AP when following up with every vendor and answering all their questions. If information is missing or the vendor would like to examine their invoice status, it could take days to sort through the necessary paperwork.
AP systems allow you to set up supplier portals, which provides vendors with limited access into the solution, where they submit invoices, view the status of any orders, and upload missing details directly into the system. They can do this all without the need to contact you.
4. Executing Payment
While monitoring payment due dates manually, it becomes easier to lose track of some of them. This signifies you might miss out on early payment discounts or even may end up owing some late fees.
Even if your AP team could stay on top of every detail, many teams are still paying by paper check which carries a huge cost and is a higher risk for fraudulent activities.
The best AP systems enable you to schedule electronic payments for invoice approvals. Moreover, it will automatically track payment deadlines so you never miss a payment. For vendors, who only accept paper checks, the solution helps streamline this payment option as well.
Automating all these steps together into a simplified workflow is more effective at every step and also provides advantages that come with a cohesive AP system.
Hence, choosing the right AP software can increase efficiency and eliminate fraudulent activities by creating simple and scalable payment controls into each supplier payment process.