Within your business’s finance and accounting department, the accounts payable (AP) area of bookkeeping may not be where your concern is, but that could be a big mistake you’re making. Ineffective AP systems can actually cost both small and large businesses a lot of capital and time, and there’s actually a lot more that can be done about it than you might think. If you’ve not considered updating your AP process to a much more modern one with specialized software, you should consider doing so because cloud accounting now has the capabilities of expediting AP while being much more affordable for even smaller businesses with smaller subscription plans. Here a few areas your costs can be saved by doing this.
Doing Away With Lost Paperwork
The accounting department usually is where business costs of buying paper for the printers and copiers runs up with the very high volumes of documents that go through it, but even more annoying is when managers have to dig through all kinds of files to locate lost or deeply buried paperwork. When you digitize your AP process, you’ll be able to eliminate both paper purchase costs and lost time searching for lost documents.
You’ll even be able to speed up the data entry into invoices, get through the review quicker and even make sure clients are paid quicker. Even if your supplier hasn’t yet digitized their billing systems, many cloud-based AP systems have now enabled supplier access through their portals making it easier for them to receive payments and process your invoices.
Using Object Character Recognition (OCR) For Entering Data
One system that can help eliminate the barriers of going from paper processing to actually digitizing the data in paperwork is object character recognition (OCR). What this means is instead of just keeping files of scanned documents backed up on a computer hard drive, the AP system can actually find the data in the documents and transfer it into the appropriate fields. Artificial intelligence (AI) applications also can be integrated into the system’s processing and OCR so that manual entries and errors are greatly reduced in the invoices.
Getting A Workflow For The Department That Works
Organizing, prioritizing and streamlining the invoice processing aspects of AP is everything when you need to maximize the ROI in supplier payments. Good AP systems can ensure each supplier and invoice due is prioritized appropriately and delegated to the right employee, ensure that they move to the proper authority to be approved and ensure they are fulfilled according to the vendor contracts.
With the right systems, you can look over the contracts and make sure your payment times are matching your supplier’s logistical obligations and determine whether or not early payments you’ve been making to them are getting the ROI that they should.
In conclusion, if you want a better way of managing your AP expenses, it’s time to look at a processing system that can speed things up and turn your business around. You can usually sign up for trial periods in different systems to get a feel for how easy their interface is to use, and whether or not it has the payment system you want. You may want to go with a company that offers live chat support in case you have any issues running it.