Accounts Payable Automation or AP Automation is software and technology that is designed to handle accounts payable processes, without the need for paper trails or human involvement.
AP Automation replaces the manual tasks of processing, approving, paying, and documenting invoices and other financial records of a company or firm with programmable software.
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Why is it Necessary?
Besides the fact that any forward-thinking corporation or company in today’s tech-heavy climate would do well to make use of as many digital aids as possible, surveys conducted have found 3 main problems that AP Automation directly solves;
- Large paper trails.
- Stunted workflow traffic.
- Time wasted on non-value-added tasks.
In addition, many businesses also realize that AP Automation; be it cloud services, invoice approval software, or internet-based invoice and receipt submission reduces the strain on employee resources.
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Here are some drivers behind companies’ shift towards AP Automation.
Reduces Errors and Improves Accuracy
The sheer volume of details, estimates, calculations, and data in a reasonably sized company’s AP portfolio means that the probability and occurrence of mistakes through human error are usually quite high. Of course, many companies have procedures to double-check the data, but these also increase complications and create a drain on resources. The risk of single undetected wreaking havoc in a company’s financials is greatly reduced by using AP Automation.
Saves Time and Money
A large corporation’s AP department may have thousands of invoices to file, copy, fax, email, and record every week. Not only is that a time consumer, use large amounts of paper is expensive and unfriendly to the environment. Using software and the internet for most of these tasks cuts down drastically on time and money spent.
Enhances Transparency and Betters Oversight
Using software to manage invoices means that from the moment they are entered into the system, they can be tracked and monitored instantly with the click of a button. Orders and payments become more transparent and safe as a result. Referrals and data sharing have also become much easier.
Increases Productivity
A large company that is not using AP Automation isn’t actually storing its invoices as paper trails. The compiled data are still entered into a database. However, this data is imputed manually into the system, which is an arduous task and an antithesis to productivity. AP Automation eliminates this problem because the invoices are digital from the start of the prices and thus all manual work is reduced to zero. Human resources can thus be redirected to more important duties.
Lessens Risk of Legal Penalties
All companies are governed by laws and regulations on their operations by the governments under whose jurisdiction they do business. An automated AP process makes complying with rules, providing any requested data or records as well as passing any audits much easier.
The goal of any business or corporation is to maximize profits and minimize losses. AP Automation is one of the most important and efficient innovations for making the business prerogative possible. Surveys show that companies that use AP Automation report massive gains in efficiency, productivity, and accuracy. Suppliers and customers have improved relationships because of the uninhibited flow of payments. AP Automation is well worth the effort for the benefit it provides to any good business.
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