Accounts payable departments across the world encounter various issues that contribute to cash leakages such as duplicate payments, or transactions that contravene the company policy. Though these overpayments when seen individually might seem insignificant, such payments over a period can have a ripple effect on the organization’s bottom line.
Thus, organizations should implement a method by which duplicate payments and frauds can be alerted via red flags.
Let us examine a few best practices for accounts payable automation which can help an organization significantly reduce the risk of accounts payable fraud and boost their bottom line:
BEST PRACTICES FOR AP AUTOMATION TO BOOST YOUR BOTTOM LINE
Maintaining a unique supplier master data list of compliant on-boarded suppliers
Manual registration of suppliers by the accounts payable professionals comes with the risk of duplicate supplier records. Also, adding new suppliers to the supplier master data list without proper scrutinization can lead to associated compliance risks. Thus, a 360o approach to supplier master data management is required for compliant onboarding of suppliers into an organization ecosystem. An SIM-based e-invoicing software is a solution for maintaining a unique supplier master data list of compliant on boarded suppliers. It enables a robust registration process which guards against any potential fraud. Additionally, tax forms, insurance forms, payment information, and supplier profile information can be gathered from a single point. In fact, it also helps automate the compliance process by continuously vetting supplier information at a data field level and sending notifications for any flagged changes for review.
Organizations often are unable to keep track of overpayments or prevent duplicate payments due to lack of monitoring controls in a manual based or semi-automated accounts payables process. However, with a portal based touchless e-invoicing end-to-end AP automation suite, organizations can reduce the risk of initiating an erroneous or duplicate payment by the workflow functionality of automated three-way matching with no human intervention, thereby reducing the risk of improper matches resulting out of human error. Also, the supplier self-service portal enables a supplier to create an invoice by flipping a PO, and thus it eliminates the risk of processing a duplicate invoice, paying an incorrect amount, or paying the invoice amount to an incorrect supplier.
Capturing discounts by having a holistic view of disbursements
Visibility is essential to disbursement systems so as to not lose out on discount capture opportunities. It is imperative to have a single consolidated view of your payments which can render the visibility of the early payment discount opportunities available. The best of portal based technology available for accounts payable automation today enables you to analyze payment terms, undertaken discounts and new discount opportunities. It also allows the collaboration of Treasury and AP departments to optimize working capital using dynamic discounting.
Accounts Payable is no longer a tactical function but a strategic partner for business transformation which helps to improve the bottom line of an organization. The best practices enlisted above might sound daunting, but implementation of even one of them can show positive results.
If you are seeking help to implement the best practices for accounts payable automation, drop in a demo request and our AP automation experts will guide you through.