Account payable is simply money owed by a business to its suppliers shown as debt on a company's balance sheet. Account payable(AP) is when a company buys goods on credit and has to pay back in a stipulated period of time.
Account payable automation is the system of minimising human intervention and removing error-prone tasks from the accounts payable process. AP automation software empowers businesses by reducing manual tasks and freeing up cash flow.
1)Saves time: Account payable automation makes invoice processing and approval faster, than in times gone by when invoices would sit on desks or wait in email inboxes for approval by removing time consuming and error prone manual tasks.
2)Improved accuracy: With account payable automation, your invoices can be verified quickly and this makes it easy to identify duplicate payments. There is also no need to manually input the details of your invoices after they must have been submitted so the possibility of human error is reduced drastically. This process automatically flags down exceptions to be reviewed by your approvers. It also makes reporting, budgeting and auditing easier and more accurate.
3)Easy access: Businesses will like to keep track of their invoice applications to avoid making late payments and damaging relationships with their suppliers. Unfortunately, papers can get lost easily and so, account payable automation will save you some time and effort that can be directed at other aspects of your business. AP automation allows full access to the payment cycle which makes it easy for anyone who has access to learn the status of an invoice. Since you can monitor progress in your workflow, it is easy to identify where delays might be coming from and address it accordingly. In addition, an electronic report system is easier to follow than the paper ones and helps in exposing fraudulent activities faster. It also makes your files safe from fire or theft because automated files are always backed up.
4)Increased transparency: Managers can make use of automation for employee reviews. It can be used to monitor the performance and productivity of an individual or a team, which helps to determine when you need to hire more staff to improve the overall productivity of your business.
Transparency is highly admired by business owners, suppliers, investors, employees and consumers so AP automation providing that is a win for all.
5)Low cost data preservation: Past records of your business should be kept for at least 6 years and keeping paper records can cost a lot from getting storage units to maintaining file cabinets. Automated records cost way less than manual records because all you need is a cloud storage.
6)Effortless auditing: Account payable automation software can help with document management, improving your auditing processes. It links all details involved in each transaction by matching invoices with purchase orders and receipts. This traceable audit train reduces the probability of paperwork going missing and ensures compliance from staff.
7)Better business relationships: Account payable automation software makes it easier for you to serve your suppliers in the best way possible and maintain good long-term relationships that benefit both parties. Timely approval, payment of invoices and fast delivery will keep you in good standing with both your suppliers and customers. The system will also alert you to time-sensitive situations such as payment delays, etc which will give you ample time to address the situation and right whatever wrong might have occurred.
Grow your businesses fast by automating your account payable