The Risks Of Not Automating Accounts Payable
AUTOMATION PAYS
When an organization chooses to forgo an accounts payable automation solution, it forgoes many benefits as well as risks. The lack of such system can lead to the distortion of accurate financial information and the possibility of errors and fraud.
Organizations that do not use an accounts payable automation software system tend not to have efficient controls, which can result in several risks for their financial health and operations. Some of these weaknesses can result in inaccurate account balances and lost budget tracking, as well as lack of accounting standards compliance. An organization can find itself in deteriorating financial cycle as result of inaccurate records, with both the cost of running the organization and potential losses skyrocketing. This can create an overwhelming financial burden and rapidly deplete resources.
A manual system of accounts payable without an automated solution leaves the organization facing potential performance downgrades, such as slow response times and the weakness of invoices and payments tracking. This can result in missed payments, delayed payments, and reduced ability to balance the books, which can lead to revenue losses, degradation of customer satisfaction, and significant impact on bottom lines.
Without automation, organizations are unable to realize the best practice of making timely payments that optimize vendor relationships and bring in valuable discounts and incentives. The lost time and efficiency associated when manual processes are used will also have an impact on the effectiveness and accuracy of the workflow and underlying accounts.
Overall, the disadvantages of relying on manual system of accounts payable far outweigh the benefits. Without an efficient and secure automated system, an organization runs the risk of damaging its reputation, deteriorating its financial health, and losing customer and vendor relationships. By investing in accounts payable automation software, an organization can not only increase its efficiency but also mitigate financial risk.
