Today, many business enterprises are automating accounts payable and switching to electronic invoices. This is because the manual process based on paperwork has become burdensome and more than 35% of AP managers are unable to answer the amount it costs for their organization for processing an invoice. Even though they are not sure about the cost per invoice, it usually costs more than it should.
Unidentified and high expenses are not only the problems related to paper-based systems. Error-prone manual data entry and lengthy processing are some serious problems and when left unchecked, can make the organization less efficient. Worried? There are ways to confront them.
Automating the accounts payable process eliminates most of the problems associated with processing accounts payable manually. Automated accounts payable software provides a cost-effective and easy solution that will work for every organization and fix their AP.
Here, are a few ways in which a good accounts payable system can aid your organization to save money and build an efficient process.
- Consistent Data Entry
Transferring invoice data manually from paper to your system takes a lot of time and is error-prone. People make mistakes while entering data and a simple error such as a typo may lead to costly errors. An online accounts payable system takes care of all data entry. Electronic invoices entered into the system automatically collects data. Electronic data capturing technology scan paper invoices as well as electronic files to create dollar amounts and line items that are easily exported to your accounting software, thus helping you to save time and eliminate errors.
- Enhance Invoice Matching Correctly
In order to avoid making incorrect payments, it is important to check every invoice properly. In a manual system, employees have to check twice to ensure that the information entered was copied accurately. A 2-way matching includes matching standard invoices to the purchase orders and checking all entered information thoroughly.
3-way matching is good for preventing fraudulent activities and employees can verify the invoice and purchase order with records of goods received.
Such kind of matching is extremely difficult in a paper-based process. Accounts payable automation helps to match invoices and purchase order without doing any hard work. Moreover, you can automate purchase order systems and makes things more efficient. An integrated system from the same automation vendor ensures that purchase orders and accounts payable works together seamlessly.
- Control Fraudulent Activities
Preventing fraudulent activities in a paper-based system are extremely hard to enforce. Fraud can slip through the preliminary detection technique. Some techniques include a review by management and internal audits.
Automating accounts payable software helps strengthen internal controls and catch fraudulent activities which slip through the system. The AP software makes it easier for every employee to detect if any fraud has taken place. Automation also makes it easier for AP managers to conduct audit trails and reviews, so they can catch fraud too.
- Speed Up the AP Process
Processing invoice manually takes a lot of time for approval. The accounting team can easily fall behind, lose an invoice, or simply fail to get it approved. This, in turn, will cost your organization more money. Employees spend a lot of time on processing invoices and dealing with late payments.
An online accounts payable system like SutiAP routes invoices for a quick approval. Automation can really help you reduce approval time from an average of 30 days to 4 days. The AP solution helps in prioritizing invoices in order to stop late fees. AP software also sends reminders to approvers to keep the flow moving.
- Manage Storage Difficulties
Paper documents occupy huge space and looking for a single important document takes a lot of time even when they are filed correctly. Scanning paper records and storing them electronically does not address the problem, as they are not stored in a searchable format.
A good quality accounts payable automation solution stores all your invoice information automatically in a digital format which is easy to access. With the help of a centralized document repository, you can easily search and download each and every invoice without occupying any extra space in your workplace.
The Bottom Line
Irrespective of how efficient they are, your invoice management practices won’t serve its purpose if the process is not completed. Printing out, signing, and sending paper checks are becoming obsolete. Modern payment solutions can improve this process and help businesses become more efficient.