Accounting processes can be tedious, and the amount of data to input can sometimes be overwhelming. On top of that, mistakes in invoices or transactions by bookkeepers can be not only costly, but can lead to negative customer service experiences.
Automation and artificial intelligence are paving the way for a new future for accounting teams. With technology handling repetitive tasks like manual data entry, your accounting department can focus on items that require human intervention, like vendor relations and communications. Integrating automation into your accounting system can significantly decrease human error and empower your accounting teams to put their time into more strategic projects.
What is accounting automation?
Accounting automation can take on a variety of roles depending on the platform you decide to use. Some solutions use AI (artificial intelligence), robotic process automation (RPA), optical character recognition (OCR), or predictive learning software that implements machine learning. Through any combination of these mechanisms, you can do things such as automate parts of your AP bill processing, approval processes, reconciliation, and AR invoicing. These processes become streamlined to do any tedious number-crunching instantly while notifying the correct parties throughout the workflow process. The purpose of these programs isn't to put accounting professionals out of work but to help them focus on much more critical tasks like analysis and human points of contact. This technological change helps your company improve customer service with vendors, improve audit accuracy, assist with data analytics and data accuracy, and prevent fraud.
Why are companies embracing accounting automation?
Automation tools are bringing innovation to the accounting profession. Along with empowering finance professionals, there are several compelling reasons for business owners and CFOs to add automation to their offices. From productivity, to ease of rollout, let's take a look at some of the significant benefits.
Manual accounting is time-consuming
Many accounting tasks are tedious and time-consuming, especially when done completely manually. From formatting Microsoft Excel spreadsheets to manual journal entries, tedious number-checking and data entry can take up most of an accountant's day. While this work is important, inputting financial information by hand is far from the most important way that employees can create impact. Automating some of these manual finance functions gives your team space to spend time on important human points of contact and complex analytics. This change in focus from the repetitive to the more intricate can cause a massive productivity transformation for the department.
Manual accounting has too many data entry issues
Human error is a considerable problem with manual data entry. These mistakes don't make it past auditors, and workplace bank accounts can suffer from even minor mistakes. Along with all these problems, it can lead to relationship issues with suppliers and skew financial data. These are some serious issues that automation easily resolves, ensuring accuracy while also completing tasks much quicker. Keeping your general ledger accurate helps analytics and cash flow reports reflect accurate data and saves your company from potential trouble.
Accountants are spending too much time on non-productive tasks
At the end of the week, when looking at your time-tracking, the last thing you want to see is that you spent all week just doing data entry catchup. Unfortunately, this isn't an uncommon occurrence, but these low-value tasks still need to be done to keep up with financials. This time can be better used for more critical and valuable work when using accounting automation to overtake routine tasks. By creating this space in your team's time, they can focus more on projects that require analysis and problem-solving.
Automation is easier to implement than ever before
Introducing new software to your team may sound like a headache. However, more recent automation programs integrate seamlessly with your current accounting software and can even help you manage it. By using two-way syncing, you can keep your main accounting program updated to the latest version. You can even import settings from your software if compatible and make reconciliation less manual.
Other benefits of accounting automation
While the above reasons are all great benefits to accounting automation, they aren't the only reasons they have caught the eyes of financial teams and CFOs. There are many other benefits to these tools that survey respondents often cite and huge boons to their teams.
Save more time with compliance work
While data entry and bookkeeping may seem the most straightforward areas for automation, many companies are beginning to use automation for compliance as well. Technology has automated tracking and reporting so that compliance is no longer a daily stressor for your team. This assistance is vital for so many reasons, including keeping your company safe. It is also another area where you start to see significant time savings for your team once automated.
Automation tools that integrate with your existing systems can help internal communications with your stakeholders. Through customizable approval rules, many programs streamline internal communication and the approval process entirely. You can easily see when a payment or invoice has been approved by the requested parties, making it easier for you to track.
Automated communications workflows can also improve communications with clients. You can easily onboard new clients, send invoices, and create a more transparent experience for your customers. This can help you get your bills paid faster and develop a positive relationship with your customers.
Fewer issues with incorrect data
Human error is inevitable. Unfortunately, that can be a massive deal in accounting. One extra number or swapped digit can cause a cascade of problems for your company and your relationship with clients. If your team is inputting large amounts of data manually, you're bound to introduce human error. While there are ways to prevent this from happening (a second reviewer, or manual audits), these methods are extremely time-consuming. Automated data entry helps your company reduce this risk and save valuable time.
Many company storage systems, such as document management systems, are beginning to move to the cloud. Storing and securing things locally is slowly becoming a thing of the past and is often outdated and unsafe. Many accounting automation platforms are now cloud-integrated, which are more secure.
Integrations with your accounting and ERP tools
Accounting automation tools can usually sync and integrate with your accounting tools and your enterprise resource planning (ERP) tools. This compatibility allows for seamless communication between your platforms, syncing settings between these tools, and other benefits. These features help make the transition and automation software integration much more painless.
Which accounting tasks should be automated?
We've discussed data entry, bookkeeping, and compliance work that can be automated, but what specific workflows are often automated? There are a handful of different ways this kind of technology can assist your team depending on your needs, but here are a few examples of how many companies utilize these tools.
Purchasing and procurement
From handling purchase order forms, approval reminders, and purchase requisition forms, there are many parts of this process that can be streamlined with automation.
Travel and mileage reimbursement
Employee travel and mileage reimbursements are also easy to automate. There are many tools available that can help create, send, and approve forms through a streamlined, automatic workflow. This technology can help save a ton of time while also reducing the potential for fraud in your company.
Expense reporting is frustrating not only for the accounting department but for managers and employees. Through a clear, easy approval and reporting process guided by automation, you can cut down on the time it takes for both the accounting team and employees.
One of the most significant accounting tasks that are often automated is receivables. Some programs have tools that allow you to accept online payments, easily route your invoices, and connect these transactions directly with your accounting software. These tools help you spend less time on your invoicing by automating the process and allowing for bulk invoicing.
Sales order process
Often abbreviated as SOA, sales order automation is a huge benefit to a sales and accounting team. It helps keep communication tight between these divisions and ensures that information isn't forgotten or left out throughout the process. This kind of automation allows sales to go through quicker and for teams to quickly finish the entire sales workflow cycle.
While already automated by many companies, payroll is an easy place where your company can save a ton of time for multiple teams through automation practices. It ensures employees are paid accurately and on time, preventing frustrating mishaps that can cause internal issues.
Invoice auditing software such as OpenEnvoy can automatically detect if an invoice total or line item doesn’t match the purchase order or estimate it was billed against and notify you, saving money and giving you more control over your cash flow.
Closing books can be time-consuming, but this process can be expedited through automation. Monthly closes is a project that will occur consistently and often and has plenty of repetitive steps that can take a ton of time to complete. For these reasons, it is a great place to cut down on manual interference to save time for your team.
What to look for with automated accounting software
So, your team has decided to start looking into automation options. There are so many different types of programs out there that this search can get overwhelming. When digging through potential solutions, you want to look out for a handful of capabilities.
Different accounting software will have different automation capabilities. Consider before searching which functions would best benefit your team and save them time, then ensure that the programs you are looking at provide comprehensive automation for those functions. If their website doesn't give details on how they implement these features, make sure to get a demo before deciding on the program.
Core accounting modules
Getting an accounting automation software that implements core accounting modules like accounts receivable automation and accounts payable automation is key to finding valuable software. Having the option to automate parts of these core functions can save a ton of time for your team, even if they aren't the primary function you are looking to automate.
Cloud access and capabilities
Programs that have to save data locally are cumbersome and can cause technology fees later on that become hefty. By getting an accounting automation software with cloud capabilities, you are not only making sure that your data is more secure but also saving your company money in local data storage costs.
Ensuring that your whole team can easily collaborate on one platform is essential. When looking for a program to implement, ask the company about their multi-user access to ensure that you won't run into issues down the road if you expand or need more users added.
Detailed analytics and reporting
Some automation programs allow for detailed analytics and reporting, helping your team make decisions and collect accurate and updated data. While there are tools in every accounting team already used for these purposes, having them integrated within your automation software can save you tons of time and effort!
Ability to scale
Every company hopes that they will get more sales or have more clients in the future. Typically when the company starts to scale, the accounting team has to invest further in new employees or other resources. With automated accounting software, you give your team the ability to scale comfortably to much higher demand by mitigating the busy work that can often make these expansions so tricky.
Start automating accounts payable with Routable
As you start your search for the perfect accounting automation software for your team, consider Routable. We can simplify and streamline your accounts receivable and payable processes through functions like accepting your online payments and sending you real-time notifications. We can help you route invoices, automate your approval processes, and pay your bills securely and quickly. Routable even can sync with your accounting software, import your settings, and help you keep your software up-to-date.
Our tools help your team scale to company growth, eliminate tedious work, and focus on what matters most. We want to help you eliminate repetitive manual tasks to empower your team to do more. To learn more about how we can help you with accounts payable or receivable, request a demo.