Intelligent Automation for Accounts Payable Process12 May 2021
When a business owes money to another business or individual, it shows up as a liability on the company’s balance sheet and is commonly considered as Accounts Payable. With technologies advancing at a rapid pace, no team or process in the organizations has been spared. The finance team has been getting huge upgrades in the way they function, improving their productivity, reducing errors, and making everyone’s lives so much easier.
Accounts Payable is generally one of the financial functions that get to experiment with new technologies and new processes, and once it works, it trickles down to the other processes. RPA has always seen Accounts Payable as one of its most important use-cases, a problem that it has been aiming to solve from its very early days. Over the past years, RPA has evolved and improved, though the problems of AP are still not fully solved by Accounts Payable Robotics Process Automation.
The discipline of Accounts Payable poses multiple challenges for RPA. For instance, the AP team uses innumerable different templates from different vendors – each having different fields, different layouts, paired with a range of domain-specific and country-specific compliance requirements, among others.
On top of that, there are so many different non-standard documents and document formats – native pdfs, pdfs of scanned images, tiff images, skewed scan images, unclear images, images containing stamps, bar code files, and so much more. The existence of non-standard documents and files is just the tip of the iceberg here! RPA has been trying to succeed but it hasn’t fully succeeded so far.
This is where IPA steps in. IPA stands for Intelligent Process Automation and has been very helpful in overcoming the limitations of RPA. Automation is essential for Accounts Payable because if all the tasks were to be performed manually, it would take significantly more time and be more expensive. Automation, thus, proves to be an immensely helpful aid for the AP function, and it can help the process be quicker, more efficient, and smarter.
A study by Gartner reveals that by 2025, 50% of business-to-business invoices globally would be processed and paid for without human intervention.
Top challenges in streamlining Accounts Payable processes
· Requiring manual data entries
· Managing multiple vendor invoices
· Missing purchase orders from time-to-time
· Problems in vendor management
· Slow and inefficient processing
· Payment errors
· Maintaining manual records
· Non-standard document formats
· Different record-keeping methods
· Different payment cycles across geographies
· Different payment terms with different vendors
Automation can help overcome a lot of these challenges for AP processes.
What is Accounts Payable Automation?
AP automation refers to the technology used to streamline and automate the accounts payable processes, remove manual tasks, and provide better visibility and control to the team over important financial data.
How can Robotic Process Automation (RPA) and Artificial Intelligence (Intelligent Automation) be used for accounts payable automation?
Shifting from performing AP processes manually to intelligent automation can help AP go from being labor-intensive workflows to error-free, quicker, more streamlined processes. There are many different ways in which intelligent automation can be used for accounts payable automation, such as –
· Capturing intelligent data from different types of invoices like physical invoices, scanned invoices, emailed invoices, faxed invoices, invoices sent by electronic data interchange (EDI)
· Sorting and classifying invoices
· Checking for duplicate invoices
· Validating data against the information available in the ERP
· Predicting how a particular invoice must be handled
· Extracting data from different invoices and arranging it into useful information
· Automatically approving invoices based on pre-decided schemes
· Compiling reports quickly
· Monitoring important metrics in real-time
· Enabling smart data enrichment
· Managing country-wise compliances
· Preventing faulty and fraudulent instances
The Accounts Payable Automation Process
Automating Accounts Payable is a lot more than replacing paper with digital. It would require changes to be made at multiple levels, including changes at the supplier end too. There would be a need for a change in the way the AP team processes and pays out invoices. Traditionally, Accounts Payable has always thought in retrospect and has always been on a responsive mode. With automation, Accounts Payable would become considerably more proactive and forward-thinking. When accounts payable embraces intelligent automation, they can drive up operational efficiency.
Modern intelligent automation solutions for accounts payable are commonly powered by cutting-edge technologies like neural networks, artificial intelligence, and machine learning. Let us take an example of a simple AP workflow powered by intelligent automation solutions. With these IA solutions, a data capture engine will convert the invoices being fed into the system.
This digital invoice would then be stored in a central repository with defined limited access to ensure the security of the data. The invoices can then be routed over to the right entity or team, or it can be moved ahead as an exception, depending on individual requirements, enabled by smart workflows of the intelligent solutions.
Once the responsible approving manager approves the invoice, it can keep moving ahead in the smart workflow. The entire process of data integration, processing invoices, and sending out payments can happen smoothly and automatically. This makes all the processes being automated so much smoother, will hardly any scope of error or need for manual interference.
Accounts Payable Automation Benefits with Intelligent Automation
Some of the top accounts payable automation benefits with intelligent automation tools are –
· Provides easy access to stakeholders
· Allows for real-time monitoring of outstanding payments when they are due, and other important metrics
· Provides greater control over the workflows
· Provides better and more useful insights from the data captured by the tools during operation
· Make the operations more transparent
· Considerable decrease in errors
· Can be easily integrated with existing financial systems adding move value with minimal changes
· Helps streamline workflows and improve efficiency
· Ensures accurate, error-free invoice processing
· Significantly reduces the possibility of incurring late or penalty fees
· Makes operations more scalable and flexible
· Keep vendor relationships healthy and smooth
· Helps avoid duplicate and erroneous payments
· Lead to cost-savings in the long term
How can Botminds Accounts Payable Automation Software help?
We are an organization committed to the purpose of liberating humans from reading boring documents. Our team is on a relentless lookout for research breakthroughs happening at the intersection of deep learning and natural language processing (NLP). We are headquartered in Seattle, Washington, with our primary development center in Chennai, India.
Our tools for accounts payable offers a template-free invoice data extraction solution with end-to-end automation, invoice loading to record creation and approval, among other features. With this, skilled accounting professionals do not have to spend their time and energy on performing tasks manually when the same tasks could be easily automated and done quickly as well as more effectively.
It offers a very easy-to-use intuitive user interface with appropriate verification processes in place including automatic record generation. Botminds’ template-free data extraction solution would make your accounts payable processes be roughly 10x more efficient. The tool would monitor email inboxes intelligently, classify and route the invoices to the right workflows, making our IPA solution the perfect choice for every AP team.
Frequently Asked Questions
How do you automate accounts payable?
Though automating the accounts payable function goes way beyond switching from paper to a computer, one needs to begin simple and take it one step at a time. Before beginning the automation drive, the team must get together and discuss their needs as well as the direct & indirect impacts of automating each process.
From there, automation can be implemented piece-by-piece. Some simple steps could be useful to begin with, such as, switching to e-invoicing, implementing seamless digital approvals, doing away with manual data entries, and automate matching & verifying all entries using technologies like OCR.
What is accounts payable automation?
Accounts payable automation is all about embracing technology and letting it carry out the heavy and tedious manual tasks in accounts payable. Automation of accounts payable processes can help streamline the AP processes, eliminating the need for manually performing certain tedious tasks while providing stakeholders with better visibility, transparency, and control.
How can the accounts payable process be improved?
While there are many ways to improve accounts payable processes focusing on different tasks and sub-tasks, it all boils down to improving efficiency, minimizing and reducing errors, reducing processing costs, reducing processing times, preventing fraudulent transactions, ensuring total compliance.
All of these can be achieved smoothly by automating the accounts payable processes. Automation could also help standardize some of the processes that might not have been a feasible idea if done manually. In 2021, automation is the way to go for accounts payable functions.
What is the main advantage of automating accounts payable?
Some of the major benefits of automating accounts payable processes with intelligent automation are –
· Automatically load and monitor new invoices
· Transform complex invoices to ERP records automatically
· Perform tasks much more quickly
· Reduce errors and improve the accuracy of accounts payable processes
· Easily grant or revoke access to team members and stakeholders
· Overcome geographical limitations by being able to access everything from anywhere in the world
· Monitor the processes and the key metrics in real-time
· Improve transparency of the processes and prevent fraudulent transactions swiftly
· Enhance the value of existing financial systems by embracing new technology
· Improve vendor and supplier relationships