Technology has an important role to play in the finance and government sectors, especially since the pandemic has changed the way we live and work.
Your finance team can become significantly less stressed whilst having more hours supporting the business by automating essential steps processes including bookkeeping, accounts payable, invoicing and accounts receivable, tax compliance, and expenditure management. Additionally, this will assist with ensuring consistent and accurate financial information.
Management of the process and
overall visibility on upcoming
commitments, individual amounts
and totals of invoices due in future
payment runs along with the approval status of invoices all contribute to
effectively managing cash flow.
Purchase Controls – Pre purchase information controls
Without control of commitments, businesses cannot understand upcoming commitments until the invoice is received and they are required to pay! This reduces any company’s ability to create meaningful projections of upcoming spend, while also eliminating control over costs.
Scale – Reduced effort
Manual processes run on an invoice volume to staff numbers ratio, with increased volumes and business growth forcing extra staff to be required. This does not provide effective methods to scale and often shows lack of redundancy when staff are on leave or move on from the business.
Duplicated Effort – Working in multiple systems
With businesses having multiple systems to manage processes, often duplicate data entry or work is required to manage this effectively. This creates longer cycle times within processes and duplicate work for staff, increasing time spent and overall process cost.
Paper based and manual processes often involve signing hard copy documents or email threads being used for approval. This does not create clear audit trails of who approved a document and when, meaning large amounts of time is spent when being audited to find documents and the relevant approver information. Spot audits for regulatory requirements pose a large company risk profile.
Paper based processes create the ability for processes to be expedited, when processes are not followed. This is commonly due to the process being difficult and cumbersome. Ability to expedite processes means compliance cannot be enforced and business rules can be ignored.
Visibility and reporting are key to making informed business decisions, with paper-based processes, data is only made available once data entry has been completed at the end of the process, meaning decisions are made without visibility of documents currently in the process cycle.
Increase of both internal and external fraud
Without predetermined systems checks including ABN information, BSB and Account Numbers, business open themselves up to the possibility of fraudulent activity both by internally and external parties. The Association of Certified Fraud examiners found that businesses lost a total of $7 Billion in 2018.
Repetitive low value tasks
Manual processes often require high volumes of low value tasks, such as routing documents or performing data entry. Studies show that repetitive low value tasks decrease employee engagement and reduce job satisfaction.
Lost and forgotten invoices
Manual processes are often managed via email folders with documents being routed for approval and review by email. Management of tasks through email often results in some things being missed or forgotten, creating delays in payments, and requiring accounts staff to follow up on documents for approval, extending process cycle times and costs.
Visibility during the Process
Often when a supplier enquires about invoice payment, the Accounts Payable team often must manually chase up invoice status and provide information back to supplier, this consumes not only the AP Team’s valuable time but also that of the approver.
Typically end of month processes for finance team members are a mad rush to close everything off and match supplier invoices to statements. This involves manually checking through statements to find matching invoice numbers to then request missed invoices to be resent or chasing documents from approvers if required. The overall process is cumbersome, time consuming and often frustrating for finance team members.
The ability for approvers and department heads to check on the status of invoices is crucial to understanding the commitments for their departments.
Access to supporting documents
Approvers commonly must look for supporting documents to make decisions to approve invoices. Manually checking for purchase orders or delivery dockets increases the time spent to approve a single document which again significantly increases process costs and is often seen as a major source of frustration for management and supervisors. Access to remaining budgets and committed outstanding spends allows not only tighter forecasting and more informed decision making but gives Budget Owners the ability to spend on the most important educational costs
Lack of mobility
Paper based approvals requiring approvers to visit a central location or retrieve documents take them away from their core job roles. This not only significantly increases process costs but is often seen as a major source of frustration for management and supervisors.
Learn more about how we implement process automation within various industries below: