1. Fraud protection: An estimated 81% of companies were targets of payments fraud in 2019, notes the AFP Payments Fraud and Control Survey. AP automation software can help your business safeguard against fraud by controlling which employees have access to invoice approval and the release of payments. You can build approval workflows with multiple people and increase the chances of catching fraudulent invoices before payment is processed. With such a process management system in place, no single employee serves as the only person tasked with approving payments. This not only helps reduce the chance of fraud but also helps you double-check for missing or incorrect data.
2. Increased transparency of data: Enhanced dashboards make tracking employee productivity easier, which can also come in handy for employee reviews. Managers can tap the tool to track individual and team performance and productivity.
3. Low-cost data preservation: The IRS recommends saving records for up to seven years. Storage costs for all that paperwork can add up. The average yearly cost to maintain a single standard five-drawer file cabinet is $2,603.64 according to North Dakota’s Information Technology Department. Meanwhile, an entire terabyte of data costs as low as $6.99 a month to maintain.
4. Easy auditing: Comprehensive AP automation software can help you with document management, which can be beneficial for auditing. The system links all documents and messages involved with each transaction while matching invoices with purchase orders and receipts. This searchable audit trail reduces your chances of losing important paperwork. It can also help you maintain regulatory compliance for quarterly or annual filings.
5. Integration with existing systems: AP automation software can easily integrate with your company’s ERP, databases, and major financial systems. There’s no need to log in and out of different applications or re-enter data to multiple systems (and increase chances of error).
6. Early-payment discounts: Most vendors offer early-payment discounts. And yet, according to the Institute of Finance Management (IOFM), most businesses capture less than 21% of all early-payment discount offers, and 12% of businesses don’t collect any early-payment discounts. There are many reasons these discounts are missed. However, according to PayStream Advisors’ AP & Working Capital Report, 31% of respondents said manual routing of invoices for payment and approval stood in the way of an early-payment discount.
