Four AP tasks you can (and should) streamline through an efficient, fully automated accounts payable solution
We don’t have to tell you that an effective accounts payable workflow is critical to your company’s success. Among other essential business functions, your AP department is responsible for:
- Managing cash flow: by carefully tracking, recording, and reconciling transactions, gaining comprehensive visibility into company-wide finances, and successfully forecasting and planning for upcoming expenses.
- Preventing against fraud:by reviewing and verifying all invoices and statements, identifying duplicate or fraudulent billing, and enforcing a clear chain of approvals for all outgoing payments.
- Maintaining relationships:with major vendors and suppliers by keeping their data up to date, ensuring they’re paid correctly and on time, and in turn securing the best possible payment terms and deals for your company
In a perfect world, these flows would all run like clockwork. But the reality is, many AP teams are so mired in the minutiae of processing paper invoices, chasing down approvals, and bouncing between different banking and accounting systems that they barely have the time or energy to think about the big picture—let alone use it to boost working capital.
That’s why we’ve created automated AP solutions that streamline business finances and save companies (and employees) countless hours of valuable time. Let’s consider the top four AP tasks that can—and should—be part of a fully automated AP workflow—and how they can transform your business.
In a traditional AP workflow, paper invoices are mailed to your company, opened and sorted by your finance team, and mined for data that is then keyed into your AP software—and not always correctly. At every turn, there’s ample opportunity for an invoice (or ten) to become misplaced, mistyped, or misfiled—resulting in delayed settlements, punishing late payment fees, and strained vendor relationships.
A manual invoice process can also mean hours of wasted productivity. According to a recent survey, the average AP professional estimates that 84% of their work time is spent processing and then correcting scores of transactional records by hand. You didn’t hire your AP team for their typing skills. You hired them for their keen insights and financial expertise.
Having invoices digitally captured and stored is especially important as business teams grow more remote and dispersed in the wake of the COVID-19 pandemic. This includes allowing authorized employees to retrieve the information they need without having to ask a colleague to email, scan, or fax over materials.
With Rho’s automated invoice flow, all incoming bills can be routed or uploaded into a dedicated AP inbox, where they’re digitally uploaded, processed, and categorized according to your company’s accounting codes. This frees up your finance team to focus on higher-impact tasks like analyzing expense data and predicting budgetary needs.
The approval process poses one of the greatest obstacles to an efficient AP system when handled manually. It can be difficult to sort out exactly who needs to review and authorize which invoices, track down high-level supervisors, and disrupt their workday to procure a signature. Missing even one link in this complex chain can result in major misunderstandings and mismatched budgets.
The smartest AP platforms simplify approval flows by automatically routing invoices along a preassigned sequence, based on factors like dollar amount.
For instance, invoices for larger expenses may require additional approvals, whereas smaller transactions may just need one quick sign-off. This practice not only results in improved security, ensuring the right people see and authorize the right invoices, it also documents a clear, step-by-step trail that makes any audit quick and painless.
With increased approval oversight and accountability, your company can safely and confidently collaborate on finances as a team.
Of course, the ability to organize and authorize your invoices is of limited value if you can’t then pay them promptly and accurately.
Many traditional AP services lack the ability to integrate with electronic payment methods, requiring companies to pay suppliers with slower paper checks. Even if they do feature e-payment options, it’s not unusual for companies to have to wait 4 to 5 days for payments to clear and to be charged for each transfer or wire—small fees that can add up fast for a growing business.
The best AP solutions offer fee-free global payments and automate instant electronic payments to all of your major suppliers.
With automated AP payments, it’s win-win. Your vendors know what to expect and are always paid on time, helping your company build a solid reputation among suppliers. Your finance team can also set a specific payment schedule that allows them to plan and prepare cash flow in advance—and to take advantage of the early payment discounts extended by suppliers.
Accounting and reporting
Traditional financial services tend to operate in silos, meaning your finance team is juggling separate banking, accounting, and AP tools in order to close your books.
An effectively automated AP platform syncs directly with your accounting and banking software, so all invoices and expenses are reconciled swiftly and easily.
Better yet, instead of manually tracking expenses across multiple spreadsheets, your AP data is gathered and reported in real-time on a digital, centralized dashboard, giving you greater visibility into your company’s liquidity and spending habits across different channels. Instead of long calculations, your team’s accounting workload will come down to a few quick clicks, leaving much more time for fruitful analysis and strategic financial planning.
A holistic approach to automated AP
It’s always tempting to invest in point solutions that promise to update a single component of the AP workflow. And, indeed, different platforms exist that can help you overcome each of the above problems one by one.
By far the most productive and cost-effective strategy for AP automation, however, is to take a broad, sweeping approach and tackle all these inefficiencies at once.
Creating a unified, optimized system across all your AP operations provides improved efficiency at every turn, while presenting the full benefits that come with a cohesive AP platform.
Rho’s all-in-one AP
Rho offers fee-free, fully automated AP as part of our unified finance suite—with no additional software required—helping you manage your AP, cards and banking all in one place.
Our AP tools also sync with your accounting software and financial accounts, so you can manage and pay your invoices, reconcile your budgets and expenses, safely collaborate on finances, and instantly close your books—all on one integrated, intuitive platform.
Get your AP moving
Read more about Rho’s AP services and learn how they work in tandem with our commercial banking, global payments, and flexible corporate cards.
Or chat with our expert team to learn what our smart AP tools can do for you.
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