What could your business achieve by focusing one, five or 10 more hours each week on financial strategy? According to a Tipalti survey of US and UK finance leaders, it takes one hour on average to process just one supplier invoice and 11 days to close monthly accounts. With half of the finance team’s week spent on manual processes, companies are losing out on the most advantageous skill of their accountants: advisory. Accounting workflow automation can unlock your finance team’s potential.
What is accounting automation?
Accounting automation simplifies and streamlines accounting processes by using and integrating software systems. This allows accountants to reduce or eliminate repetitive and criteria-based tasks. While implementing software is one piece of the puzzle, accounting oversight is also important to define, standardize and optimize financial procedures.
Some businesses may equate automation with fewer people, but automation can actually help promote finance talent and their skills. In fact, removing repetitive tasks allows accountants to spend more time on value-additive tasks, so they can work at their highest level.
Automating workflows also ensures:
- Reduced errors and increased data accuracy
- Faster data visibility and real-time updates
- Safer data storage and access
When your data is safe, accurate and visible, your finance department can make more informed decisions and faster suggestions for your business.
What can automation look like for my business?
For a company that’s outgrowing its current accounting capacity, or a company using a patchwork of different systems, it is difficult to scale effectively. Workflow automation can give you the capacity to grow and the opportunity to create a leaner accounting team. This means the ability to expand your team and promote your current talent to more strategic positions. How you improve workflows will depend on your growth goals as a company.
There are a range of automation solutions for businesses at all stages of maturity. Though automation is often associated with RPA (robotic process automation) or artificial intelligence, there are other meaningful and accessible ways to optimize workflows without the need for major investments in technology.
Automation can be as simple as moving from physical ledgers or Excel spreadsheets to accounting software or cloud services. Or, automation can look like a standardized expense approval process that routes forms and receipts from one individual to another based on final approval criteria. Regardless of what method you use, the end goal is to create an agile finance team.
Five accounting workflows you can streamline today
Workflow optimization will differ with every business, but automating activity for your core business functions will provide benefits at every level.
Here are some accounting areas that can quickly benefit from workflow automation.
- Banking– Link your bank accounts to your accounting software to automatically retrieve transactions. Add rules that assign your account codes to streamline or eliminate manual review for entries.
- Payroll – Integrate a payroll processing system that retrieves timesheets, calculates deductions, automates approvals (within your thresholds) and issues automatic electronic payments.
- Accounts payable – Vendors can submit invoices directly to an email account attached to your software. There, the source document is stored, read with OCR technology (optical character recognition) and can be automatically approved and paid. Mobile apps can also easily capture and load receipts directly into your accounting or document software.
- Accounts Receivable – Automatically create and send recurring invoices. Invoices can be mailed, emailed or sent by text message. Add a payment button to increase your cash flow. Schedule aging reports to automatically generate and be distributed to escalate collections.
- Email and calendar functions – Create email templates, sorting criteria and share electronic calendars to more efficiently schedule meetings and tasks.
If you want increased accuracy, faster processing and more time to spend on business strategy, optimizing your accounting workflow will help you achieve those goals.
Addressing the risks of workflow automation
Migrating your data or creating procedural changes within your team may come with questions about potential risks and obstacles.
- Too many options – The plethora of choices can be difficult to evaluate. Create a roadmap of your desired integrations and take things one step at a time. Narrow down the options with reviews, trials and the experience of experts.
- Data security – Privacy, security and protection from malware are valid concerns. You should expect end-to-end encryption, role-based access and automated backups from your vendors. There is less risk with cloud-hosted data than data stored in a physical server where it can be damaged or stolen.
- Cost – Subscription costs for most of today’s software is inevitable, but those costs will be offset by more value-add activities and reduced time and error. Many software companies offer tiered pricing, so you pay for a smaller suite of services rather than the full suite. Free trial subscriptions are available with most software as well.
- Learning curve – After the initial set up, most workflow processes occur behind the scenes by design. If new software is involved, you may be poking around an unfamiliar menu for a week or two. Use fractional support to equip your team without the need to hire new talent.
Enable your accountants to become advisors
When powered by better data, today’s accountants have the ability to be strategic partners. Your accountants are the first to see financial discrepancies and the first to see financial opportunities. A CPA also understands the tax implications of your investments and business decisions.
When you define the role of accountants beyond transaction processing, you can develop a modern finance department that keeps your business competitive. Give your finance team the time and tools to help guide your decisions, identify risks and explore innovative revenue streams to drive growth.
Consult the right expertise
Automating and optimizing your accounting workflows requires both an understanding of how to implement or migrate to new systems, as well as expert oversight to better manage your team.
Enhance your finance function and bring your team up to speed with fractional expertise. Implement system changes without the need to start from scratch. If your goal is to maintain a lean accounting function, then a fractional solution can lower your risk of underutilization. The right process optimization experience or operational oversight can keep finance functions lean and efficient until the need for full-time support makes sense.
Take charge of your accounting workflows and capture the benefits of a more efficient accounting team. Find business systems and process solutions guided by our elite community of finance experts. Free up your time and build your competitive advantage in the market with Paro’s accounting services.