Organizations that don’t implement Accounts Payable automation usually suffer from the following burdens: expensive processing, higher risk level of fraud and errors, delayed payments, unsatisfied vendors among others. An AP automation solution can assist your business in addressing these challenges when applied in procure-to-pay processes. The use of AP automation enhances the efficiency of invoice processing, minimizes data input and payment mistakes, and combats fraud while enhancing the efficiency of communication between various stakeholders and vendors.
However, choosing the right AP automation software is never easy. Most of them claim to offer more efficiency, cost-effective solutions, and easy AP management. So how can a business select from the numerous choices of solutions that exist in the market today?
Any effective approach to choosing an AP automation software must begin from an AP-focused approach, turning the challenging and often tedious accounts payable processes into smooth and easy work for all the employees in the P2P cycle.
Four criteria set the ideal solutions apart from the rest:
The Power of Integration: Automate the P2P cycle with integrated ERP Systems
AP Automation & ERP Systems: A Perfect Blend
In general, the factor of applying AP automation in combination with the ERP system results in perfect interaction and precise functioning for improving the efficiency of the organizations and yields many strategic benefits. The integration of AP and ERP can bring about substantial benefits like reduced costs, better predictability of revenue and moreover better control of business.
Enhanced Operational Efficiency
Another advantage that comes with integrating ERP with AP automation is its efficiency. This integration brings efficiency improvements by fast tracking invoice processing and eliminating manual errors which were frequently common as one needs to check the entries in ERP manually before processing which leads to delays and errors. But integration helps not only saving time but also leaves the finance team with little or no time to engage in matters that can contribute nothing to the course of the business.
Improved Financial Visibility
Combination of ERP with the automation of AP features offer a real time business outlook on financial processes. This is because financial data need to be linked and stored in a single database to allow the management to retrieve current information at any time. It therefore implies that this kind of visibility can result in enhanced decision and acuity of strategic planning.
Cost Savings
The integration of ERP and AP automation thus leads to the following advantages: The use of the two systems saves a lot of time that could otherwise be spent on manual work. Through eliminating the duplication of the efforts and automating most of the tasks, it aids in minimizing the expenses incurred on the AP activities and specifically the invoice processing time to countless.
Improved Control Over Financial Operations
ERP and AP automation enhancements afford more control over financial operations. Through the thorough integration of efficient and smooth automated procedures and real-time financial data, businesses can track the critical finance points, detect problems as early as possible, and then come up with corresponding measures. It is sometimes claimed that this enhanced control can promote better control over various financial aspects of a firm’s operation, and thus better business performance.
Scalability
When dealing with large enterprises, the flow of funds in and out of the business is slightly more complicated than it would be at a smaller organization. ERP and AP automation is beneficial because the solutions they offer are scalable and can be adopted to suit the firm’s growth. This means that it can process more invoices and other AP work at a given time without needing enhanced resources, thus making it appropriate for more expansive enterprises.
Better compliance and risk analysis
AP integration with ERP can enhance compliance and risk management. Since it keeps a record of all the activities of the AP department, it is easier to show compliance with financial regulations. It also decreases the possibility of frauds and mistakes since repetitive work is minimized while offering updated insights on the company’s financial activities.
Better Supplier Relationships
Paying the suppliers on time and making correct payments is essential for healthy business supplier relations. Integrating ERP and AP automation can enhance supplier relationships, since payments will be timely and accurate as AP automation will help in processing invoice faster and posting the entry back to ERP for payments. This can result in better bargaining powers with the suppliers as well as enhanced supply chain management.
How does ERP and AP Automation software work?
The integration of AP and ERP systems enable your ERP to become a single source of transaction information in your organization that provides visibility in the procure-to-pay cycle. This integration eliminates human interference and thus eliminates cases of payment delays or failure, streamlines invoice verification and reconciliation, strengthens supplier relations, and handles payment systems.
For this integration to be effective, there must be a flow of data from the AP automation system to the ERP. The method of integration often varies depending on whether the ERP system in question is cloud-based or an on-premises system. Cloud-based solutions allow API integration, which the AP teams can incorporate without much help from the IT department. On the other hand, on-premises ERP systems typically use file integration with templates to import or export the data.
The primary constituents of AP automation integration platforms
Invoice Processing
There is automatic scanning of invoices and the entering of data into the main database. All invoicing and line-item information are captured, entered, GL coded, and validated.
Payment Processing
All the important transaction data, communication and approval status must be input into the payment systems, hence making the processing faster and more accurate.
Invoice Posting
The invoices that have been entered and verified are transferred to the ERP system on confirmation.
Reporting and Analytics
Some of the benefits are up-to-date transactional data and visibility of AP workflows and approval status all of which can be fed to the ERP system for business intelligence.
Invoice Workflow
Such invoices are directed to the employee for approval or reviewing depending on the set rules or parameters.
Compliance and Controls
These two systems integrate and enforce internal control, consolidate, and validate data for the complete AP audit trail and have segregation of duties.
Invoice Reconciliation
The AP platform ensures that actual invoice and transaction information is available in the ERP for fresh invoice matching.
The Future of AP Automation for Large Enterprises
For large companies, the integration of AP automation solutions with ERP systems is essential for maintaining operational efficiency and achieving strategic goals. As businesses grow and evolve, the ability to scale AP automation and ERP integration becomes increasingly important. Large companies can benefit from:
Pre-packaged and fully managed ERP connectors from Cherrywork
The integration between the ERP system and Cherrywork AP Automation solution makes it possible to transfer master data from the ERP to Cherrywork solution for employees to use the correct financial information. Cherrywork has fully managed integrations to leading ERP solutions from SAP, Microsoft and Oracle
Conclusion
Automated AP provides solutions to fix the accounts payable for any business, especially when integrated with ERP systems. Other advantages comprise increased organizational effectiveness, improved control over financial flows, potential cost reduction, improved supply relations, and financial management.
Cherrywork offers customers the chance to build their own integrations, as sharing data between systems is more important and customers can build connectors to ERPs or other applications with documents REST APIs. REST APIs provide a flexible, lightweight way to integrate applications and have emerged as the most common method for connecting components in microservices architectures.
Cherrywork AP Automation is one such intelligent solution that enables seamless integration to your organizations backend ERP system while making the business process more efficient, less prone to errors, and cost effective which there by leave other crucial activities that help the business to grow and innovate.
However, the AP automation provider that an organization selects ultimately determines its ability to achieve these benefits. Consider a solution which can be easily operationalized, flexible for multiple teams’ usage, build confidence in the approval process, and delivers the product efficiently. With the ever-evolving business world and new advancements in technology and procedures, the adoption of AP automation and ERP systems integration will be crucial.
Would you like to do the same for your organization? If yes, then reach out to us at talk2us@cherrywork.com
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