Are you still choosing manual, outdated AP processes over advanced technology? Are you frustrated by the human errors and double payments caused by your AP department?
AP accounts or payable accounts refer to an account that represents any company’s commitment to pay off the debt to its suppliers or creditors.
Outdated processes of AP experience human errors during manual data entry and coding. Accounts payable
for beginners or small companies is an easy process, but if your company is big and deals with multiple bills in a day, you’ll have to opt for advanced technologies.
If you are scared of updating your accounts payable department with the latest technology, you are losing on so much in the long run. Manual, paper-based AP process is ineffective and inefficient in recent times. If you wish to stay ahead of cutthroat competition, AP transformation is the only way.
How technology is giving efficient AP
Think of an accounting payables department working like a well-oiled machine. Your invoices are received through a sound-organised medium and are automatically matched to goods or services received. Duplicate invoices are discarded, and errors are detected immediately. Not only that, the approval workflow is streamlined.
Technological advancements like machine learning (ML) and artificial intelligence (AI) boost efficiencies with how you submit your invoices, how you receive and verify them, and finally, how you pay them. OCR can also assist by converting documents into searchable and editable data, but it is not as user-friendly as other AI technologies.
AP payment types must be defined so that funds for payments are associated with suitable GL accounts.
The Future of AP & Accounts Payable Processes
Today almost every individual, firm and company is familiar with AP automation
but, incorporating artificial intelligence or machine learning is entirely new. Transforming your account payable processes helps in unlocking value and strengthening supplier relations.
AI and ML offer self-learning abilities to the AP automation software, and AI seamlessly merges with the company’s ERP systems.
You can bring efficiencies to your accounts payable process by integrating your ERP systems with your critical other business applications. You can eliminate the need to retrain your staff by making it easier to use systems at full functionality.
After approval of an invoice, it is sent to the accounting system to detect and eliminate manual data entry. Vendors who operate identical systems can be handily assimilated into your accounts payable process with no delays or complications. Improving functionality through integration can enhance the improvements to your AP funnel.
With scanning or storing of documents, file architecture becomes well organised. New invoices incoming can be sorted, scanned, filed and organised in a way that makes the most sense. It becomes easy for clients to bind documents to invoices, contracts being one such document.
With such an organised system, where all contracts and vendors are linked, you do not have to sort files manually.
With software, AI technologies and machines, you can shift towards a paperless AP department.
Management of Invoice Lifecycle
Workflow management follows the scanning of documents, giving way to streamlining invoices with errors; one such error involves recording duplicate amounts. These invoices are routed from the processing of scanning to the next step in the funnel. The invoice already scanned and verified can be processed by the final date. Invoices with errors or problems can be sent to the employee’s inbox for checking and verifying the invoice.
From that place, the invoice can be proceeded to the payment file or may be sent back to the vendor for amendments. At Masters India, vendors can check the status of the invoice, see whether it’s been accepted and received or it still needs action.
These processes assist in limiting accounting headaches and building confidence and goodwill with your vendors. Automated technologies can drastically reduce manual hours needed for managing files, giving way for efficient and effective allocation of employees resources.
You should not ignore the benefits gained by the latest technological advancements. Cloud storage is the new normal for storing data and transmission of data. Because of the ‘always on’ feature of the cloud, you can access your data anytime, anywhere and from any gadget.
Artificial Intelligence and Machine Learning can prove to be a massive asset for your company. Technology can increase speed and accuracy exponentially, thus proving to be the most valuable tool for your employees. It assists your staff by allowing them to expand their productivity and build greater relationships with customers and vendors.
Accounts payable or payable accounts management is crucial for the smooth functioning of a company.
The secret to the success of CFO’s and Controllers is intelligent technological advancements.
Automation and paperless technologies support AP funnel, cost little money, take less time, use fewer resources and reduce accounting headaches. Finance professionals and experts are making use of these technologies to drive efficient processes and affect the profitability of the company.
FAQ’s (Frequently Asked Questions)
In simple terms, AP processes refer to the entire process of paying vendors and suppliers for goods and services received.
- What is AP process in different companies?
AP department makes payments to suppliers of goods and services, and after the invoices are received, an entry is made is the ERP system.
- What is workflow in accounts payable?
The workflow process refers to sequential steps that describe any company’s entire end-to-end system in procurement and payment of transactions.
- What are the two types of payments in accounts payable?
Cash and personal cheques are the two types of payments in AP. Other than these, debit cards and credit cards are also used.