The Cobra Effect: Understanding The Risks Of Not Utilizing Accounts Payable Automation
CHECKLIST FOR INVOICE PROCESSING
The prudent use of technology in accounts payable operations can be an invaluable asset to any organization. With the ever-increasing cost of operations, the need for automation in this vital operational area is becoming more salient. Despite the clear benefits associated with automated accounts payable systems, many companies fail to apply such technologies, leaving themselves vulnerable to potential risks. Understanding both the potential rewards and risks associated with not using software for checklists in invoice processing is essential in the modern corporate landscape.
Organizations often grapple with the decision of whether or not to adopt automated accounts payable solutions. While some C-Suite executives may determine that the process of manual accounts payable operations is sufficient and cost-efficient, such calculations rarely take into account the long-term risks. Without automated solutions, companies are open to wider range of risks and negative outcomes.
For example, the static nature of manual operations often opens the door to range of data entry errors and oversights, including lost documents and incorrect payments. Such errors often result in additional costs for the time and resources required to rectify the mistake, as well as potentially irreversible financial damage to the company. What’s more, manual operations also remove the opportunity to take advantage of predictive analytics and insights, leaving the organization more vulnerable to malfeasance and fraud, both internally and externally.
When applied correctly, automated accounts payable systems reduce such risks, while simultaneously optimizing operations. Automation helps reduce the potential for human errors, while adding additional structure and oversight. Automation also ensures secure and verifiable audit trail, making tracking cross-department activities and expenses more streamlined affair. Furthermore, automated payments help reduce the time and cost associated with traditional manual payment methodologies, such as paper checks.
One of the more common misconceptions regarding such automated solutions is the perceived cost associated with their implementation. The truth is that such automated solutions actually remove overhead expenses associated with manual processes. This is in addition to the potential cost of further software investments, such as analytics and workflow, that help create operational savings. Ultimately, modern accounts payable automation processes provide the potential for significant cost savings, while reducing the chances of errors and malfeasance.
For any organization weighing the options of modern accounts payable automation, it is essential to first comprehend the major risks of not using necessary software. Such risks may include data entry errors and oversights, lost documents, incorrect payments, and heightened vulnerability to fraud and malfeasance. Without the assurance of secure and verifiable audit trail, companies can quickly find themselves vulnerable to costly errors and offenders. On the flipside, automated accounts payable solutions provide an unparalleled level of efficiency, oversight, and security. Pairing the costs of manual processes with the potential risks associated with such, it is clear that investing in accounts payable automation is the best way to save in both time and money.
