Advantages of accounts payable automation software
There are countless reasons why having accounts payable automation is the need for your organization. Not only does it help you stay at par with modern trends and competition but it also helps you manage your payments better, bring together all financial activity, and maximize the output with a focused platform towards accounts payable management.
What is accounts payable automation?
Accounts payable automation is the contemporary method of paying bills through more advanced and error-free software. Using accounts payable management software eliminates the possibility of human error, wrong data entry, and any double-dealing.
However, the accounts payable process is seen as a secondary function of the finance and accounting departments. Regarded as a back-office task, AP automation never gets the spotlight, resulting in poor working capital management and cluttered cash flow. Adverse effects of this can be seen through declining goodwill of the company, damaging relationships with the stakeholders, and slower response and delivery time.
Undertaking a more strategic approach for efficient accounts payable management goes a long way in improvising the cash cycles, establishing cordial relationships with suppliers, earning rebates or early-payment discounts, and making the processes simpler for employees. Therefore, optimizing the accounts payable workflow process helps determine the future course of action.
Reasons to automate accounts payable process
Eliminates duplicate task
Automated software carefully examines every transaction before letting in any entry. Any similar value with the exact details is immediately discarded. This way, no same transaction is fed into the software, and no damage is caused to the financial statements.
Saves time and effort
Having paperless reporting helps in saving time and efforts in juggling between different paper receipts and invoices. AP automation brings together all the touchpoints and makes recording, storing, interpreting, and reconciling the data more accessible.
Early payment discounts
AP software has built-in reminders for scheduled invoice payments. Timely payments to suppliers help companies earn substantial discounts, which helps save money, establishes good faith among stakeholders, increases possibilities of new orders, and stabilizes the entire supply chain workflow.
Scales productivity
AP automation helps employees escape the never-ending cycle of paper receipt matching. These repetitive tasks give a hard time to employees, preventing them from focusing on high-value jobs. Automation in the accounting process eases the burden of the finance team and helps them dedicate time for strategizing KPIs.
Data-driven analytics
The accounts payable software gives insightful data about the gross spending of the organization. Granular details regarding each purchase order, the total value of the invoice, and vendor name are displayed to give a clear picture of all the trades payable. The analytics provided thereon can help formulate future planning and devising new work processes.
Risks of not adopting AP automation
Progressing without automated software is a cumbersome process for employees. The repetitive tasks of the accounts payable process drains energy from employees and thereby reduces their productivity.
Difficulty in vendor management
It is essential to have records stored in one place for anytime access. Managing invoices, contract notes, purchase orders, inventory bill becomes a back-breaking task. Non-payment of dues damages the vendor's faith.
No clear visibility
Working with the paper and spreadsheets method clutters all the information. Manual entry everywhere burdens the finance team by switching between multiple sheets and piles of paper and finding out records from previous data files. Moreover, generating reports or statistics can also be difficult due to scattered data.
Stakeholder relationship issues
Repeated delayed payments or under-payments can shake up the investor confidence in your company. This showcases inability to manage the cash cycle and working capital. Also, companies let slip chances of getting discounts or upcoming orders. Situations like these can erode a company's good standing.
Best practices for AP automation
Paper is the enemy of efficiency. Having a paper-based accounting system slows down the accounting and communication process. Shifting towards paperless systems allows better workflow, accessible communication, and healthy working capital and cash flow management figures. The tasks, right from creating purchase orders to confirming their payment, can be done through an electronic system through the software.
Enforcing more robust policies can help strengthen the internal processes, pave a way out of the traditional systems and advance towards a more secure and reliable platform. The policies should favor the workforce, and it's important they find it easy to apply them in any given situation. Having pre-decided policies and procedures acts as a guiding light to every person in the organization.
Using an automated system helps identify the previous system's bottlenecks. A computerized system is an investment for the business and not an expense. Suppliers can be reached directly for any queries through the accounts payable system. The invoice processing is much swifter and easier to account for in the system. The method of capturing receipts is as easy as clicking a picture.
Volopay x Accounts Payable
Volopay’s SaaS-driven accounts payable software provides solutions to scattered data entries, order management, vendor payments, and invoice processing.
Transfer money to over 130 countries with the lowest price and no surprise charges. Easy vendor management with payments to their bank account directly through the software by matching against invoice number.
Scan, upload, and approve invoices in a single go. Schedule your invoice payment or any other wire transfer for a future date. Track the status of all your invoices and payments in real-time.
Integrate your accounting system - Xero, Quickbooks, Netsuite - into the accounts payable management software for enhanced visibility and easy reconciliation of all the entries added into the software.
Recurring payments for scheduled your invoice payment for a future date. Multi-level approvals to approve such payments from multiple people. Never miss a payment again.
Physical and unlimited virtual cards for business that can be used for a variety of purposes such as travel, gifts, subscriptions etc. These cards make accounts payable easier than ever before.
Three-way invoice sourcing, the accounting department can directly upload invoices on our platform, mail them to us, or we directly sync unpaid invoices from your accounting system.