The Hidden Costs Of Not Automating Accounts Payable
CONSIDER THE FOLLOWING T-ACCOUNT FOR ACCOUNTS PAYABLE
Organizations large and small understand the importance of managing their Accounts Payable balances securely and accurately. Keeping current on payments to vendors, suppliers, and service providers is fundamental part of successful financial management; however, any Accounts Payable (AP) process that is still paper-based or based on legacy systems is unnecessarily labor-intensive and costly. Automating the AP process not only streamlines the workflow to increase efficiencies, but it also prevents over-spending, delays, and confidentiality issues.
By implementing accounts payable automation software, organizations open themselves up to unprecedented levels of security and control over their respective AP operations. Missing requests, invoices, and checks can be immediately flagged while complex billing can be tracked without worrying about miscalculations or discrepancies. The software also allows companies to improve efficiency by automating various processes, such as routing invoices for review and approving payments.
Furthermore, Accounts Payable automation software also reduces manual data entry errors, lowers filing and storage costs, and can be integrated with other financial applications for streamlined workflow. By reducing the time and resources that are necessary to manually streamline the whole process, clerical costs can be reduced to mere fraction of what is needed for manual process. Additionally, automation helps eliminate redundant processes, such as emailing spreadsheets, scanning documents, and other related processes.
Organizations that are stuck in an outdated manual process are forced to allocate increased time and resources to manage their AP. This leads to delays in payments for vendors and suppliers, leading to potential late fees or even an impact on their credit history. Automation software can help ensure that bills and invoices are consistently paid on timely basis.
Finally, using Accounts Payable automation software makes it easier to comply with the recently introduced Generally Accepted Accounting Principles (GAAP). As more countries and states move towards the financial reporting standards as set out in the GAAP, AP automation can greatly improve accuracy and consistency, thereby improving the accuracy and consistency of companies financials.
The hidden costs of not automating accounts payable are numerous, affecting companies working capital and bottom line. The strain and stress of tracking payments, avoiding late charges and ensuring compliance with financial regulations can distract from more strategic activities. Automating the process can help organizations prevent escalating costs, reduce labor-intensive effort, and achieve higher level of accuracy and control with regards to financial management. Ultimately, Accounts Payable automation software provides organizations with greater financial security, time savings, increased accuracy and visibility, and streamlined compliance.
