Firms That Automate Accounting Processes Cut Missing Invoices by 60%

The adoption of accounts payable (AP) and accounts receivable (AR) automation solutions, such as eInvoicing, digital workflows and virtual cards, can yield benefits for businesses across a multitude of industry segments.

In the small to medium-sized business (SMB) sector, a study found that automation led to a 60% reduction in missing invoices, a 59% decline in delayed payment and reimbursement approvals, and a 55% drop in missing receipts, as reported in the Optimizing AP & AR Playbook, a PYMNTS and OnPay Solutions collaboration.

Get the report: Optimizing AP & AR Playbook

These findings demonstrate how automation can reverberate across business operations and improve cash flows of SMBs, a segment that highly values effectively allocating their limited resources.

That’s especially true at a time when more than half of Main Street businesses say that increasing inflation is putting their sales forecasts at risk, and about two-thirds say they’re worried that inflation and economic uncertainty could tamp down their goals for 2022.

Read more: Main Street Merchant Index: Sales Rebound Expectations Vary With Age of Business

Liberating Companies’ Staff From Conducting Routine Reviews

Automation has long been a driving force in the AP and AR space, and its pace and scope have expanded considerably in recent years, largely due to advances in artificial intelligence (AI) and machine learning (ML).

Cloud- and app-based systems now allow employees with photos of receipts and other documentation to file expense reports from their smartphones, and incoming paper or digital invoices can easily be routed directly to necessary approvers via customized workflows.

AI-based systems can be particularly useful in reviewing and processing reports and invoices on the back end, identifying and flagging suspicious patterns that might indicate fraud, funds misuse or policy violations. Such tools can liberate companies’ staff from conducting routine reviews and allow them to focus on areas that require human judgment, such as fraud analysis.

Digital AP and AR automation solutions offer additional benefits amid heightened public health concerns: These systems help remote teams work efficiently while minimizing reliance on physical documents.

Delivering Real Market Value

Another automation solution, the virtual card, ensures funds settle quickly, preventing the potentially weeks-long delays associated with checks. The rich data virtual card systems and eInvoicing provide also allows them to improve payments visibility and help firms more effectively and efficiently manage payment flows.

A further strong indicator that AP and AR innovations are delivering real market value is the degree to which firms prioritize them as future investment and development areas. These solutions stand out amid countless digital B2B products and services, and firms indicate that automated payables, invoice-enabled payments and automated receivables are among their top investment priorities.

These benefits lie at the heart of why finance officers and business owners want to optimize their AP and AR operations. Their paramount priorities are reducing the time, the quantity of manual processes and the number of individuals involved in processing invoices and payments, and there is strong evidence that adopting AP and AR automation delivers these benefits.