The automation of accounts payable and receivable is one step forward in a greater move towards a more modernized, fully digitized operation.
Accounts payable (AP) and accounts receivable (AR) functions are incredibly important to a business.
Do it right, and you are tracking payments and expenses most efficiently, reducing errors, collecting payments on time, and eliminating unnecessary and wasteful spending.
Get it wrong, and you are making and collecting payments late, disrupting cashflows and budgeting, and damaging relationships with clients and vendors, which could result in legal action.
Because accounting functions have been so manual in nature, it’s easy to get things wrong.
Automation in AR and AP can address many of those issues, and in fact 90% of CFOs want automation to fix payment delays and errors, as just one example.
With that in mind, it’s worth understanding at the most basic level what AR/AP automation is all about.
It’s simple. The goal with automation is to make accounts receivable and payable processes more efficient and convenient:
When it comes to AR/AP, automation can do a lot:
When these processes are automated, think about the time, money, and hassle saved.
Investment firms and other organizations should not spend valuable time and resources on these activities when they can do other things that help their business.
If you’re a smaller investment firm or another business, you and your team are likely to deal with AR and AP processes manually.
But these workflows will become increasingly clunky, time-consuming, and full of errors.
As the number of invoices increases and time is increasingly limited, your team will be stretched thin.
If you’re serious about scalability and avoiding disruption to accounting processes, now is the time to start thinking about AR/AP automation.
There’s a lot that can go wrong, especially in Excel spreadsheets. Even the most diligent, well-meaning employee will make a mistake.
A tiny mistake might be ok in other departments, but not finance and accounting. Even the smallest mistake can have the largest and most fatal of consequences.
An extra digit, a misplaced decimal… a lot can ruin the accounting.
These kinds of mistakes can severely strain relations with clients and vendors, and potentially threaten the job of the person or supervisor that “allowed” the error to occur.
What’s more, it could take countless hours trying to find the mistake, which is another waste of company resources.
And a lost client for you is a new client for your competitor that has more efficient AR/AP processes.
Accounting is an absolutely necessary part of running a business, but not every investment manager or businessperson has the time, interest, or expertise to implement AR/AP automation on their own.
And that’s totally fine. If firms know that the technology exists to streamline their processes, that’s all they need to take that first step.
There are accounting automation experts like Empaxis that specialize in accounts payable and accounts receivable workflows.
All you must do is explain your situation to them, walk through your procedures, and then show or describe your ideal outcome.
The automation experts will analyze the processes, determine the workflow logic, build and program the automated bots, run the bots in a test environment, then deploy them into the live environment.
Just like a car, bots and the systems/applications they operate need regular maintenance.
Software and desktop computer versions need to be updated, and bots also need to be updated to continue functioning properly.
Additionally, workflows will change. Given the demands of your business, you will modify your accounting processes over time.
As that happens, the bots will have to be reprogrammed to account for the changes in procedures.
Again, you don’t have to worry about these activities; accounting automation expert services providers will take care of it all for you.
To be most efficient and competitive, investment managers and other businesses must move away from manual, paper-based workflows.
And for most firms, accounts payable and receivable are manual and paper-driven tasks.
Making that work paperless and automated will deliver that efficiency, and accounting is one of many processes ripe for improvement via automation.
The workplace is challenging enough with rising costs and competition, and those challenges are compounded by internal inefficiencies, which squeeze profit margins further.
For those reasons, businesses must take on a fully digitized approach.
Think about data and your workflows as a combination of these traits:
Data and records that are electronically stored, online, cloud-based, accurate, seamlessly shared between systems, instantly ready, and secure yet easily accessible to relevant parties.
Workflows that are streamlined, automated, saving you the most time and money as possible.
Digital transformation is part of the future for any business that wants long-term success and relevance and, and by automating AR/AP, that is a good place to start.
Indeed, accounts receivable and accounts payable are crucial business functions that investment firms and others cannot afford to mess up.
And it’s nice to know that automation can be applied to so many workflows and address pain points.
It’s true. You really don’t have to be an expert in automation.
Many firms assume the burden is on them to get it set up, but in fact there are AR/AP automation specialists like Empaxis that will handle the bot programming, maintenance, and reprogramming, ensuring the utmost accuracy and expediency in workflow completion.
It’s also true that many organizations dismiss the benefits of automating AR and AP, assuming their current approach is “good enough”, mistake-ridden as it may be.
But when business grows and accounting mistakes arise, they’ll wish they had taken action sooner to prevent the problem.