A little over 86% of accounting teams manually enter data, and for 40% of them, it consumes a quarter of their workweek.
Accounting is therefore an area in most firms where automation can actually help with time savings and risk reduction.
For example, the cycle of accounts payable is a complicated process that is impacted by multiple approval processes, delays in payments, and lack of insight.
These issues frequently plague managers who solely rely on manual AP procedures, which negatively impacts the organisation’s operations.
Every business needs to look at automation software to make this issue better. Through improved invoice processing and automated workflows, these solutions can speed up, simplify, and increase the effectiveness of your accounts payable procedures and the finance team in general. Companies are able to concentrate their efforts and time on things that generate value thanks to the resources saved by these solutions.
Although making the switch to this is essential, implementing change may be particularly challenging.
Before you implementfinance automation solution in your firm, it is crucial to start your project with adequate preparation and learn to avoid potential pitfalls.
Finding all of your primary pain points is the first step in automating your accounts and data entry workflow. You can choose a solution once you are aware of the deficiencies you have.
Techniques to pinpoint your processing problems are mentioned below to aid you in the process.
Costly Manual Processing
Delayed invoice processing through labour intensive manual entry results in highprocessing expenses, which are a major barrier to corporate expansion.
For example, Deloitte estimates that up to 35% of companies cite high AP processing fees as one of their main problems with conventional payment methods. In addition to paying 62% of labour costs, these companies spend £6 processing each supplier payment.
You should take into account costs like as hardware, paid IT assistance, employee wages and benefits, software fees, managerial overhead, as well as other elements that increase costs when calculating the average cost per invoice.
Experts estimate that invoices often cost between £10 and £25. However, effective AP automation software has the ability to dramatically close this gap.
By dividing the total number of paid invoices by the total processing costs spent during that same period, you can determine the average cost of bills.
Recognising and accurately processing all invoices
A single document frequently contains several invoices. Businesses frequently combine many invoices into a single PDF. For a person, this might not be an issue, but it causes the AP department unneeded delays.
Missing invoices result in a number of delays that put your relationship with the suppliers in danger. According to study, 30% of middle-market companies claim that processing payment delays cause them serious issues. Another estimate states that it takes around 30 days for suppliers to get their payments, and that up to 47% of them do so after a delay.
It’s time to look for an automated solution to these problems if your business experiences the same problems. Although such invoices can be detected by sophisticated automated invoice processing solutions, not all automated solutions have these features.
You may do this by using an automated system that combines OCR (Optical Character Recognition) with cutting-edge machine learning.
Delays in Processing Payments
According to study, 30% of middle-market companies claim that processing payment delays cause them serious issues.
Payment delays can be caused by a number of problems, including as delayed routing, delays in approval, incorrect entry of figures and complacency on the part of suppliers or buyers.
Because of this, payments to suppliers often take 30 days to arrive, and up to 47% of suppliers receive payments after the due date.
Accounts Payable Has Limited Transaction Visibility
For example, within Accounts Payable, it can be challenging to keep track of all the invoices when a business receives hundreds of them at once.
According to Deloitte, up to 93% of transactions are carried out online. Limited visibility obscures major issues, causes hidden errors, and causes additional expenses, delays, and disruptions to the payment cycle.
According to a poll, a lack of transaction visibility forces 56% of accounts payable professionals to make educated guesses and prevents them from forecasting their cash flow. This indicates that the majority of finance teams struggle to appropriately predict spending or trends as well as how to successfully deal with supplier invoice liabilities.
These difficulties can change based on the needs and specifications inside your firm. If your business experiences the same lack of visibility, you should look for solutions that provide you access to a wide range of reporting options.
Payment Methods for Suppliers in AP Processing
The AP department has a difficult time matching with each of these possibilities because every supplier has a distinct preferred mode of payment for their company. Buyers must decide how to make payments while taking into account the payment options used by their suppliers.
Therefore, processing requests for supplier payment can be very difficult unless their AP department incorporates all payment options into their workflow. Paying your suppliers on time is challenging unless you find a solution that effectively manages diverse workflows.
Finding a good AP processing solution can be challenging if you don’t know what your company is lacking. You can, however, find a solution that simplifies your process and sufficiently tackles your problems by going over the pain areas stated above.
How Itas Can Help You Get Rid of Accounting Processing Pain Points
The good news is that using Itas, we can help you with those pain points through our cloud software solutions. Our flagship product Sage Intacct has can help you achieve a 250% ROI and reduce your monthly end time by up to 79%.
Who we are
Itas is a multi-award-winning Sage partner. Having started in 1995 with just one customer, we now support over 200 clients nationwide. They know we are always there to provide a helping hand, whenever they need us. Trusted by our customers for over 20 years, Itas has been built on referrals from customers and IT professionals that love the expert yet personal service that we offer.
If you would like to know more about how Itas can help your business with Sage implementation and improve purchasing control, you can get in touch at [email protected], call us on +44 (0)1824 780000 or contact us via our website.