Automated invoice processing to better manage cash flow
Do you also find yourself wondering how automated invoice processing could improve your company’s cash flow management? Let’s face it, with the pace at which technology is developing it's easy to lose track of all the things being developed in the industry. So, if you do find yourself asking this question let us assure you, you’re not alone.
As with most paper-based processes, traditional means of invoice processing is highly tedious and prone to errors. Manually entering data, cross-checking expenses, etc. only end up adding to the time, effort, and resources required by finance departments. At the same time, the pace of work our world demands is only increasing.
Invoice management is an internal business process that all companies follow. This process, simply put, is responsible for managing payments and maintaining records of the same.
The process typically involves five steps. First, an invoice is generated for any sales or purchase made, the invoice is then received, invoice information is extracted, verified, and corroborated. Following this, the payment is approved and, subsequently, the invoice is stored to be used in the future.
Invoice management is an integral part of managing and tracking a business’ expenditures. Good invoice management encourages regular cash flow, eases accounting woes, and saves you time, thereby ensuring your company stays audit-ready.
Manual invoice processing tends to demand a significant amount of time and effort. Moreover, there is always a possibility of error and delays at every stage.
Finance teams must first receive the invoice and input the information it contains into a system. Delays can begin at this stage itself, supplier invoices are often stored for a long time in recipients’ inboxes before your accounts department can get their hands on them. Then comes the task of accurately extracting information, budget-holder confirmations and then there’s ERP system entry to be approved. At each of these stages the possibility of delays, and the need to chase individuals, is significantly high.
There’s also the issue of invoices being misplaced before they even reach your accounts team. Delays like this often result in the issuing and subsequent processing of duplicate invoices; appropriate approvals processes being neglected; and so on. While the monetary impact of the additional time spent managing these invoices can be calculated, there’s always the possibility for other ancillary costs to be accrued. Late-payment penalties or interest charges due to processing delays, double payment of duplicate invoices, missed early or on-time payment discount opportunities also add up.
These are still a fraction of the direct financial obstacles presented by manual invoice processing. Procedural non-compliance and erroneous or fraudulent budget allocation are not always easy to track or gauge. Yet, these could add up to cause considerable hiccups in your accounting process.
The digital revolution brought about by invoice management software has been extraordinary. How easily the aforementioned steps have been automated and streamlined by the power of technology is almost magical.
The unavoidable presence of human error when it comes to vendor invoice management has been overcome by software. Extracting and coding data is obviously a hassle. The process is especially time-consuming and prone to errors when done manually. With the help of invoice management software, the entire process can be automated and freed from the burden of manual entry. Gone are the days when your business could lose out on revenue and resources due to late payments, incorrect invoicing, and such. With machine learning software you can rest easy while a few lines of code make the entire process automated, error-free and, simply put, easy.
Automation also means a reduced need for human intervention. As a consequence, your company can defer hiring personnel unless they are an absolute necessity. Team expansion is an expensive and tedious task, this fact is universally agreed upon. Not only do you have to allocate budgets and spend time calculating costs but there is also the hurdle of finding the right fit, which can take time. Even when a need does arise for hiring, machine learning software gives your team the ability to handle increased workloads seamlessly while you focus on finding the right hire.
Maintaining and managing payment records on paper can be a mammoth task for your teams. Integrating invoice management software with your accounting systems means that this entire process can be automated without the fear of erroneous entries. This means that, with automated systems, whenever you need access to a particular invoice all you need to do is click a few buttons. Not only do these systems eradicate the fear of not being able to locate data but it also saves physical space, time, and effort.
Automating invoice processing not only means lower error rates with regard to data entry, but it also means you have better quality data at hand. This software is capable of managing and building massive databases which, if done manually, would have been highly time-consuming and error-ridden. With such data available your finance departments can make much better, more informed decisions with regards to payments and revenue.
One of the biggest advantages that such software brings is the time and, consequently, money that is saved. Less time spent doing mundane manual entry tasks means your team has more time to spend on other, more important, tasks. Manual invoice management can take approximately 20 to 21 days. On the other hand, outsourcing tasks such as vendor invoice management to software can cut that time down to just 3 to 4 days.
Being climate-conscious is a need for all companies across all industries. With vendor invoice management now being done completely via software, you can dramatically reduce the amount of paper your company uses.
Now that you know how invoice management software work, the next step involves choosing the right provider. In this context, one of the best available expense management software out there is provided by Volopay.
With spend management platform, companies can make invoice payments to suppliers within the country and across borders. Additionally, you can earn discounts by offering to pay invoices earlier.
With Bill Pay you can pay vendors around the world, set up custom payment approvals and personalized spend parameters that work for your business.
The platform serves as an all-in-one software from which you can manage all expenses, finances, cards, reimbursements, and so on. It eradicates the need to handle multiple dedicated software to complete different tasks and rolls it all into one seamless platform for all your needs.
Syncing with accounting applications like Xero, MYOB, Deskera, Quickbooks, and Netsuite has never been this easier. Once you make the payment through Volopay, it automatically syncs and updates this into your overall financial records.
Automating with OCR, having invoices in one place & getting a vendor PO number, are some of the steps to avoid duplicate invoice payments.
Better relationships with vendors, eliminating errors & saving time, are some of the benefits of streamlining your invoice management process.