Steps to Automate your Accounting Processes
It is predicted that by 2025 almost all repetitive finance related processes will be automated. With almost a third of CFOs identifying automation as a preferable investment for increased operational efficiency, the trend is clear: accounting automation is here to stay.
In today's business world, time is of the essence. We know that time is needed to do the job and this is why it is a must to automate accounting process if you want your business to be successful.
Accounting has always been a huge responsibility for the company. It is more than just recording the money transactions and serves as a valuable tool for business growth. Accountants can never be in two places at the same time, so they will need a partner to do the job.
Imagine all your employees' hand-editing, entering and double checking invoices; or having your carriers doing so on behalf of you every time they drop off a package. That would be time consuming and probably expensive for you. You don't have to imagine this scenario as with the help of automating services, it can be avoided.
There are certain kinds of financial projects that have to be done by a finance department. These departments also deal with different aspects of accounting and every project requires its own basic requirements from the technical point of view. To be able to meet these requirements, you need to automate your accounting process and make it work more efficiently.
In this article, we will look at how to automate an accounting process step by step so that you can save time and money.
Current Challenges of Manual Accounting
Many businesses are still not fully digital, posing challenges when it comes to accounting. Fraud, missing documents, and a lot of money left on the table are three common problems that can be solved with automation of manual processes. Automation can radically reduce the time and effort required to perform many tasks in accounting. Here are some of the most common manual accounting challenges that could be solved by automation:
- Using auto-matching PO to invoice can help reduce data entry errors
- By automating finance workflows, you can focus on more important tasks while receiving approvals quickly
- Duplicate pay-outs are detected, and fraud is easier to detect when accounting is automated
- Losing or misplacing financial records can result in financial penalties. Automated systems, backed-up online, and cloud storage ensure that you can have peace of mind and comply with regulations
- You can avoid paying late and risk damaging relationships with your vendors by using automation
- Automation allows you to centralize, ingest and make payments more quickly, giving you financial oversight
Now let us understand the benefits of automating accounting processes-
Benefits of Automating an Accounting Process
Accounting process automation helps increase accuracy by removing or reducing manual data entry from the equation.
Automating your accounting can allow you to achieve better results than if you were manually performing the same tasks. Speed is one of the biggest benefits of automating your accounting, as it allows you to access your financial information whenever you need it, regardless of where you are.
In a recent CFO survey, CFOs were most concerned with optimizing spend in the face of cutbacks and rising inflation. Automating accounting processes gives you the flexibility to pay your suppliers automatically and take advantage of early payment discounts.
Steps Involved in Automating Accounting Processes
The long-term benefits of automating the accounting process are not to be understated. The benefits include increased employee productivity, elevated morale and improved quality control. When poorly designed AP solutions are used, the monotony of manual accounting can be painful and tedious. Automating accounting reduces labour costs by eliminating the need for human resources who could otherwise perform other tasks.
Changing your accounting workflows is a big change for your business. To make the switch as smooth as possible and to ensure that it's not too time-consuming, you can automate some of these processes-
Document your current accounting systems, tools and processes
Document all your business requirements so that when you are ready to procure a new AP solution, you have them handy. Ask yourself: What accounting tools or accounting software do we already use?
Choose the Right AP Software
Choosing the right accounting software is an important task for any business. Survey the market for choosing the right AP tooling to optimize AP workflows. Read reviews from experts to learn more about how certain software packages work best in different industries. Read our case study here how we helped our IT client to automate invoice process.
Choose the Right Service Provider
Once you have identified the leading software solution providers in your industry, set up demos with each company and involve key stakeholders in the process. Then you can score the firms across the following business requirements: cost, functionality, and customer support.
Prepare for Migration
When you switch to a new accounting system, you'll want to have your financial data ready for migration so the process is seamless. This is probably the most time-consuming step in automating your accounting process, so start early.
Integrate and Test
Once you've finalized your new AP solution, set up new workflows and make sure to test them thoroughly.
Train and Educate Employees
When you introduce a new system or process, you must always communicate with the rest of the business. Train employees how to use the system and educate them on how it will affect their work.
Evaluate your Current Process
Before you start building an accounting system, you should first map out your current processes. Look for areas where steps can be consolidated, and approvers can be reduced to save time and streamline accounting workflows. How can you automate your accounting department? The following are some ideas-
- How steps are in the accounting process currently carried out?
- Identify the current bottlenecks in the accounting process
- Which workflows or steps are currently working well? Which ones need improvement?
- What accounting tech or tooling are we already using? What are their strengths and weaknesses?
- To increase automation, what role does each stakeholder play?
Explore the Market
There are numerous types of finance and accounting software on the market, each with varying capabilities. Make sure to narrow down all use-cases that your business could benefit from before you choose a product. Do you just need to automate the accounts payable process? Do you need help with contract management? Or perhaps automated invoice capture?
Automating accounting process is the need of time for successful entrepreneurs. Accounting processes like billing, invoicing, outstanding payments, monthly reporting, etc. can now be done with ease and there are many tools available to facilitate this process.
There are a lot of advantages in automation. In the business world, it is all about saving time and cost. Automation is an important factor in saving both of these resources. It has been proved that it reduces costs and increases profitability and efficiency on a large scale. Accounting automation can be done step by step by a professional accounting firm. There is no need for you to do it all on your own. Accounting software can help you with automating accounting processes.
CIGNEX AP automation solutions bring your team better accuracy, speed, and savings when it comes to all things accounting. Ready to talk? Contact us for a free POC (Proof of Concept) where we will show you the capability of RPA which can benefit your company.