The Challenges Of Automated ARAnd How To Accomplish Full Order To Cash Through Automation
AUTOMATED AR SYSTEM
Today, accounts receivable (AR) is vital to the financial health of many businesses and organizations. Unfortunately, the process of collecting, verifying, and invoicing payments can be difficult and time consuming. Without accurate and reliable tracking of payments, it can be difficult for businesses to stay on top of their finances. That?s why many businesses and organizations are turning to automated AR solutions for their order to cash (OTC) processes.
When companies AR is automated, customers? payments are received, reconciled, and deposited into the companies bank account faster. Additionally, customer invoices can easily be matched to payments and reconciled in much more efficient manner. Automated AR solutions can also help companies manage the customer payment lifecycle, allowing managers to monitor and identify areas where account adjustments are necessary.
In this guide, we?ll provide an overview of the challenges of automated AR and how companies can accomplish full OTC process through automation.
Overview Of The Challenges Of Automated AR
One of the biggest challenges associated with automated AR is ensuring the accuracy of customer data. Without having customer data that is accurate, it can be difficult to reconcile payments and invoices, resulting in customer dissatisfaction or incorrect financial statements. Additionally, due to the large number of transactions that are associated with AR, manual data entry can be cumbersome and time consuming.
In addition to accuracy and data entry, companies must also consider how to handle customer disputes and fraud. Automated AR can help eliminate numerous errors, but it can also create new sources of fraud as customer data is used in the system. For example, fraudsters can use stolen customer credentials to make payments or to access customer accounts. Companies must ensure that their automated systems have appropriate security and fraud monitoring measures in place.
Finally, companies must ensure that they have an established workflow to handle customer payments. Without such workflow in place, it can be difficult to ensure that customers? payments are tracked and reconciled in timely manner.
Accomplishing Full Order To Cash Through Automation
In order to accomplish full OTC process using automation, companies should consider automating the entire financial operations cycle from invoice creation to payment receipt. By automating the OTC workflow, companies can reduce the amount of manual effort associated with both billing and payments.
To start, companies should begin by automating the invoice creation process. This involves integrating the billing system with other systems, such as customer relationship management (CRM), enterprise resource planning (ERP), accounting, and inventory systems. This will allow companies to quickly and easily create accurate customer invoices. Additionally, automating invoice creation can reduce the time associated with manual data entry.
Companies should also leverage automation to verify and approve customer payments. This involves integrating the payment system with the banking and accounting systems. By doing so, companies can automatically validate and approve invoice payments. Additionally, companies can set up automated triggers to alert them when payments are due or overdue.
Finally, companies should look to integrate their automated AR systems with their analytics and fraud detection systems. Doing so will ensure that customer accounts are accurately reconciled, while also reducing the risk of fraud. Automation and analytics can also help companies spot and address any discrepancies between the customer?s invoice and the payment received.
Conclusion
By automating the entire OTC process, companies can reduce the manual effort associated with AR and improve the accuracy of their financial reports. Additionally, automation can help companies reduce their exposure to fraud by allowing them to quickly and easily reconcile customer accounts. By following the steps outlined above, companies can leverage automated AR solutions to streamline and improve their OTC process.
