Managing accounts payable is a critical function for businesses of all sizes. It involves handling a company's outstanding obligations to creditors or suppliers for goods or services received but not yet paid, commonly known as accounts payable (AP). These payables appear as current liabilities on the balance sheet. However, this crucial aspect of financial management often presents significant challenges, ranging from timely payment processing to maintaining accurate records and fostering strong vendor relationships. Additionally, given the susceptibility of accounts payable to business fraud, it becomes even more essential to establish robust controls and implement diligent monitoring to safeguard company resources.
The traditional manual approach to processing invoices and executing payments is time-consuming, error-prone and can hinder operational efficiency.
According to a report by IOFM, it costs over $18 to manually process a single invoice, while it only costs less than $5 with an automated system. Aside from additional costs, manual processing takes an average of 14 days, meaning suppliers and vendors must wait nearly three weeks to receive payment. This strains the relationship between the organisation and its suppliers, and can also result in purchase discounts lost which is a forfeiture of the suppliers’ offered discount for early payment.
Aside from delayed payments, businesses also struggle with duplicate entries and data inaccuracies, leading to missed opportunities and potential financial risks. However, in an era driven by technological advancements, there is a solution at hand: accounts payable automation.
Accounts payable automation refers to using technology and software solutions to streamline and optimise the accounts payable process. It involves automating various tasks and workflows, such as data entry, invoice matching, approval routing and payment processing through advanced software systems. Businesses can enjoy a wide range of benefits by implementing accounts payable automation.
5 Reasons why you should Automate Accounts Payable:
1. More efficient teams - When you automate the entire accounts payable process—from PO creation, invoice extraction, coding and verification to approvals—your teams can get time back and focus on more value-added tasks.
2. Better visibility across business spending - By centralising purchase orders and invoices in one system, you can get better visibility across various areas of spend and when they are due, to regulate your cashflow and plan better.
3. Reduction in costly mistakes - With the elimination of manual entry, your finance teams will be able to reduce human error and feel more confident while processing invoices.
4. Enhanced accuracy and compliance - Fraud checks are built into the AP automation workflow and you will benefit from the verification of invoices and bank information as well as a clearly documented trail, that ensures you are prepared for all audits.
5. Better vendor relationships - With smoother payment processing , you will be able to build better partnerships with vendors
By streamlining the accounts payable process, businesses can cultivate stronger vendor relationships and create a positive impact on their overall supply chain management.
ProSpend offers a game-changing solution with our hyperautomated accounts payable platform.
We streamline every step of the accounts payable process by leveraging advanced automation, intelligent workflows and robust analytics. Additionally, our Human-In-The-Loop (HITL) machine learning ensures accurate data capture during scanning. This innovative approach eliminates the need for manual data entry and improves accuracy rates.
One of our valued clients, Breakthrough Accounting, experienced firsthand how ProSpend transformed its accounts payable process through account automation. They overcame manual invoice processing challenges and achieved remarkable results. Invoice processing time reduced by 75%, improving cash flow and enabling faster payments. Data entry accuracy soared, minimising errors and eliminating manual corrections.
Aside from HITL, ProSpend's accounts payable solution has the following features that help you streamline your process:
ProSpend's integrated spend management platform offers a number of benefits that can help your teams take control of accounts payable with
Say goodbye to the inefficiencies of using multiple disconnected tools. With ProSpend, you can unify your expense and AP management into a single platform, giving you a complete, real-time view of your business spend. This integrated approach allows you to make informed decisions and maintain better control over your financial processes.
Easily create, sync, and manage purchase orders directly within ProSpend, seamlessly integrating with your existing ERP systems. With our automated workflows, you can reduce manual errors and ensure that POs are accurately matched to invoices and receipts, keeping your business running smoothly.
Automate the entire invoice process—from extraction, coding and verification to approvals—so you can focus on higher-value tasks. ProSpend’s advanced automation eliminates manual data entry, reduces human error, and accelerates your AP workflow, freeing up time for more strategic financial planning.
Protect your business with robust fraud prevention mechanisms built into ProSpend. Our platform automatically checks supplier details, validates invoices, and matches bank information, ensuring that you only make legitimate payments. This layer of security allows you to operate with confidence, knowing your financial integrity is safeguarded.
Our powerful integrations with leading ERPs ensure a smooth flow of data between ProSpend and your existing systems. Whether you’re using Microsoft Business Central or MYOB Accumatica, ProSpend syncs effortlessly, helping you maintain a streamlined, accurate, and up-to-date financial process.
As businesses strive for operational excellence and efficiency, automating the accounts payable process emerges as a key solution to overcome the challenges of manual workflows. The advantages are clear, from improved efficiency and increased productivity to cost savings, enhanced accuracy and stronger vendor relationships.
Accounts payable automation empowers businesses to gain better control over their payables. By embracing this digital transformation, businesses position themselves for success in a rapidly evolving business landscape, driving growth and achieving sustainable success.
Ready to simplify your accounts payable?
Get in touch with our experts and schedule a demo to explore how ProSpend can streamline your processes and drive growth.