RPA’s Influence on Accounts Payable Payment Processing-A Study
Most businesses across industries, find it highly challenging to deal with finance and accounting process management. In particular, we can say the accounts payable (A/P). You may think that it will be breezy for industries now with all the technological advancements. It is also true to some extent and Robotic Process Automation (RPA) aids to somehow give a face-lift to this situation.RPA’s Influence on Accounts Payable Payment Processing.
As a matter of fact, there are many accounting departments that still depend upon manual tasks. They predominantly use paper invoices to process payments. Further, there are many organizations that even prefer outsourcing this process for smooth transactions.
Eventually, Robotic Process Automation (RPA) can facilitate companies to effectuate their financial tasks. This can aid in increased efficiency and operational control to some extent. Ultimately, you can’t say that it is not a complete cure for accounts payable problems.
Bearing this in mind, let’s kick-start this discussion with the role of RPA in financial task automation.
What Is Robotic Process Automation (RPA)?
In this fast-paced world, the tedious work handled by health service providers and physicians is proliferating. At this juncture, Robotic Process Automation comes in handy.
Robotic Process Automation (RPA) is a grade of business process automation technology. It is phenomenally based on metaphorical software robots (bots) or artificial intelligence (AI).
As a matter of fact, in traditional workflow automation tools, a software developer produces a list of actions. They can be done using internal application programming interfaces (APIs) or dedicated scripting language.
Need for Automation in Accounts Payable:
One of the top priorities of the finance heads is to be able to handle invoices in an efficient and intelligent manner. Most Organizations across industries spend a reasonable amount of money on single invoice processing manually. At this juncture, Invoice Processing has become a pivotal part of the operational expenses of any company.
Several automation tools have come up in the market and hogged the limelight in terms of accounts payable automation. But what makes robotic process automation the much sought-after solution to AP automation is the flexibility and adaptability of workflows that RPA facilitates.
RPA in accounts payable refers to the utilization of technology to control and automate rule-based processes. The catch here is- without the need for any human intervention in terms of collections, deduction management, automated cash application, and more.
Manual AP Processing-Challenges:
Apart from time and cost, here are some major challenges in manual AP processing that are kindling the shift to RPA in accounts payable.
- Invoices in Paper Format
- Lack of clarity into the Outstanding Liabilities
- Missing/lost Invoices
- A large number of Discrepancies
RPA in AP – Apex Use Cases for Automation
Robotic Process Automation generally focuses on tasks that are purely repetitive and mundane in nature. Hence, the tasks that are most suitable for RPA in AP include:
- Invoice Approvals/Matching
- Invoice Data Entry
- Payment Execution
Top 9 Benefits of RPA in AP
RPA technology can actualize the processes much simpler for AP professionals, which paves way for many benefits. Some of these are discussed below:
1. Streamlined Capturing
In a stereotypical manually-driven accounts payable environment, the process of capturing and matching data from supplier invoices is completely managed by the data entry staff. This is a strenuous process and can pose delays to invoice processing.
It is 100% true in the case of decentralized accounts payable teams. Eventually, there is no mechanism involved to ensure that the invoices have even been received at the right location. With accounts payable invoice automation these shortcomings will be taken care of.
2. Better Compliance
Manual AP processing often brings down huge pressure on the staff/employee in terms of the PO. As a result, they end up holding up the overall process by forgetting to go with the confirmation of services.
3. Error Disposition
The manual data capturing in AP workflow is a labor-intensive task. It can predominantly lead to flaws in the data entered into an AP system.
Robotic Process Automation can enhance the process with the help of automated invoice data capturing. Ultimately, it can reduce multiple error costs.
4. Faster Account Harmonization
With the Implementation of RPA in accounts payable, a vast change can be witnessed. RPA can make this process much smoother than software bots. They can be used to automate data transfer, manage minor decision-making, and also troubleshoot inaccuracies.
One of the prominent advantages of Robotic Process Automation workflows is that they are completely scalable.
6. Bolstered-up Supplier Relations
For instance, with manual processes, whenever there occurs a payment delay, the invoice will be sent again. This can ultimately cause confusion, and organizations may end up remitting payment twice for the same invoice.
7. Cost Savings
Organizations can make significant savings with the implementation of the RPA system. It will pave the way to take on multiple invoice data entry and similar responsibilities that were outsourced earlier.
8. Heightened Customer Experience
RPA implementation in AP paves companies to deliver enhanced customer service and get a relentless advantage in the industry.
9. Gentle Financial Closing & Reporting
Implementing RPA technology can facilitate AP departments to automatically process tax entries into various smart financial tools.
5-Step Guide to Implementing RPA in Accounts Payable
For successful RPA implementation in AP, organizations should ensure standardization of the processes and follow the following steps-
- Accounting project’s Scope
- Validation of the Identified Opportunities
- Work out on the baseline Operations Cost
- Workflow Standardization
- Project Implementation
RPA offers some mind-blowing benefits and many organizations are just beginning to realize it. With the mushrooming benefits of RPA technology in accounts payable, there is a clear trend of growing interest in further floundering.