Often accounts payable departments are still doing everything by hand. The accounts receivable may be automated, but not the counterpart in business which may still be using paper rather than electronic invoices. For some, it is just something that hasn’t been done yet, others like to physically handle each bill they need to pay. The truth is, by using accounts payable software the accountants, treasurers, and chief financial officers all have access electronically to information in the system. Much more control is maintained in an AP automation system.
One of the important reasons companies that have switched to accounts payable software the move was the right one for them is the time they have saved. There is less time needed to process invoices. When someone needs to see the information on an invoice, it is there at their fingertips. No more searching for the invoice and hoping it hasn’t been misfiled or misplaced. It literally takes seconds to get the information and those with access can do so from their own desks.
Clarity of process is also important. When your system is automated, you won’t pay the same bill twice—nor will you accidentally overpay an invoice. You will also avoid needing to make late payments if someone accidentally overlooks an invoice—the system will alert the AP department before a bill is late.
Most people consider audits a necessary part of doing business. You need someone to come in and ensure that everything is running as well as it should and to ensure employees are doing the things they are expected to do. With an automated AP system, audits can be completed both more quickly and more thoroughly. It is easy to see where the business or organization’s money went if the amount was correct, and other important details about payments. An automated AP system also makes it more difficult for an employee to get away with fraud.
More visibility and control of the business processes allows those in the executive suite more knowledge about how money is being processed through the system. More information generally means more efficiency. It is easier to check the status of work that is automated.
- Executives from all levels in an organization are able to make better decisions when they have better access to data. It is easier to see what bills are due and to make better decisions about spending money and investing back into the company. Cash flow is important in just about any business, and an automated AP system allows for appropriate cash flow in how business is conducted.
- Automated AP systems allow supervisors control over invoices that would be nearly impossible to achieve with paper copies. Supervisors can get into the system, find out where an invoice is, find out how long it has been in the system which can inform them how productive their staff is and how good they are at deciding what invoices take priority.
- There can also be cost savings for a company that uses accounts payable automation. There are no longer penalties for late payments. Your company may be eligible for dynamic discounting if bills are paid early. Invoice automation allows the business department to be leaner and even more efficient in how work is done.
- Some things cannot have a value put on them, but most would agree that the value of satisfied customers should not be ignored. Using an automated accounts payable system can improve customer service. Bills are paid faster, fewer bills are late, and these things all create people who are more willing to do business with you, and at a fair price.
More companies and organizations are seeing advantages to automated accounts payable systems. It makes them more efficient and more cost-effective.