AP automation or Accounts payable automation as it is popularly called is the process that the companies use to simplify the procedures that happen in their accounts payable department. The accounts payable department of any company is responsible for processing as well as reviewing all the transactions that take place between the supplier and the company. Thus, this department is responsible for approving, processing and paying all the outstanding invoices that are received from the suppliers. The procedure of processing an invoice involves recording all the important data from the invoice into the book keeping system of the company. The procedure involved here is quite cumbersome and can thus, result in several human errors. It is the Accounts Payable or AP automation solutions that simplify this process for the companies.
Some common AP automation solutions
The procedure of processing an invoice might look very simple but it can get really complicated if the company is working at a large level and involves a number of invoices. The problem gets even worse if the invoices that require processing are paper based since it can bring about common problems like the invoices getting lost, duplication of invoices or a simple human error at the time of making an entry. Such problems when combined with other common problems can lead to a very high cost of processing per invoice. Thus, the basic aim of introducing AP automation solutions in a company is to eliminate the chances of such errors, streamlining the entire procedure and finally reduce the cost of processing per invoice.
The most common AP automatic solutions that are absorbed by the companies are:
- Scanning the entire workflow
- Online tracking
- Reporting capabilities
- Supplier networks
- Payment services
- Electronic invoice user-interface
- Spend analysis for all the invoices
One of the most useful tools that are available in accounts payable automation solutions is the E-invoicing or the electronic invoicing. As the name suggests, the invoices are processed electronically over the internet. The vendors or the suppliers can submit the invoices using the internet which then makes it possible to automatically route and process them. Since the processing is electronic, the invoices are received and processed almost instantly which not only saves a lot of time but also a lot of human effort and the cost of processing these invoices is also reduced greatly. Among all these transactions, the chances of human errors are also reduced drastically thus, reducing wastage in every aspect. For all the above mentioned advantages, more and more companies today are considering this option.