Due to the digital age and advancements in technology, your finance employees expect that they will not be required to waste time on manual paper processes and copy and paste data onto an Excel sheet.
Fortunately, financing processes can be automated to generate invoices, and manage expenses.
Finance automation prevents delays and reduces the margin for errors. Outdated financing processes are an insult to a finance employee’s expertise, insight, and intelligence. You need to start thinking about business finance automation if you haven’t already. Today, we shall go over the advantages of automating finances and what tasks a business can automate to take extra burden off of their finance team.
6 BUSINESS TASKS THAT ARE MADE EASIER WITH FINANCE AUTOMATION
ACCOUNTS RECEIVABLE AND INVOICING
Both these processes are crucial for any type of business. Just one error or a missed step can destroy the revenue stream and turn profits to half value. Traditional invoice generation, tracking, and issuance are lengthy and tedious tasks. To accurately generate invoices, multiple teams like the sales team, finance employees, and customer service representatives need to come together to prevent delays and errors.
Experts have stated that automated invoicing allows businesses to receive payments faster.
Traditional invoicing methods have an average waiting period of 72 days. Not only this, unpaid invoices in the United States amount to $285 billion. There is an array of software that aids the automation of accounts receivable and invoice generation. Software can:
- Generate invoices and issue them
- Reconcile invoices using delivery and sales records
- Send reminders to customers
CORE BOOKKEEPING
Originally, bookkeeping tasks were done manually by creating entries for individual business expenses or revenue. All accounts were also supposed to be tallied at regular intervals and the process was quite time-consuming. Technological advancements have not only enabled bookkeeping to evolve but it has also been divided into two main stages:
- Microsoft Excel has enhanced the convenience and speed with which accounting tasks can be logged. This has also increased responsiveness, accuracy, and real-time account keeping.
- Dedicated accounting software has simplified bookkeeping by making it understandable, accessible, and controllable.
Accounting software is constantly updated with best practices so they can aid finance teams in automating the entire process. This helps save time, reduces errors, and maximizes efficiency and consistency.
ACCOUNTS PAYABLE
Taking care of invoicing and slips is one task, but ensuring all bills and business invoices are paid on time is another. The sad part is that performing these tasks manually takes a lot of time and can increase the chance of errors which may lead to heavy losses.
Finance automation comes in and simplifies the steps, reduces delays, and prevents bottlenecks. Tasks like invoice generation, information tallying, transaction recording, and sending invoices to the right individuals for approval are made simple. The software further aids these processes by scanning invoices, capturing data, and progressing timely.
Automation also saves business money by:
- Ensuring timely payments or discounts
- Reducing processing/mailing time
- Staffing resources
- Ensuring great relationships with clients, customers, and stakeholders
PAYROLL
Delayed paychecks are an easy way to throw employees off. They expect to receive payments in a timely manner and when they don’t, they might not be willing to work as hard. Since payrolls are difficult to handle manually, such scenarios may often arise.
Different salaries, superannuation, fringe benefits, holiday entitlements, bonuses, etc. make the payroll complex.
Using accounting software to automate a payroll removes a load from your financial team’s shoulders. Employees stay happier as they get paid on time. Automated reports allow the finance team to revise, make changes, and check for inconsistencies easily. There is no need to go back and forth between several different sheets to assess data.
TAX REPORTING AND COMPLIANCE
Businesses used to rely on financial experts to calculate tax obligations. These individuals also charge a good sum for their services as the process is taxing, complex, and time-consuming. Automation of tax requirements quickly eradicates all these nuisances and allows users to calculate the relevant tax for each sale promptly.
Businesses that sell or work internationally can easily calculate the taxes applicable across various regions. This allows a business to not only save time and energy but also keeps it ready for an audit.
- Finance automation software combines productivity data, analytics, workflow, and compliance reporting by examining several systems and interrogating all processes
- Tax management teams can quickly deduce an organization’s standing by going over the submission process
- Risks are calculated in real-time
- Insights and other data can be used to increase operational business efficiency
EXPENSE MANAGEMENT
Tracking, managing, and recording business expenditures is not only stressful to do manually but also costs a great deal. A series of steps that lead to calculating expenses accurately increase the chances of error in expense reports. Managers and the financing team may have to go through the entire process again even if a slight error is made.
Built-in expense management tools do not just automate the entire process to increase convenience, but also make sure that expenses are paid within set deadlines. An expense dashboard helps save time while accurately displaying company expenditures at the end of each month.
ADVANTAGES OF AUTOMATED FINANCING
With an array of excellent accounting and finance automation tools, it is no surprise that business finance processes have become more organized and timely. Businesses can enjoy the accuracy, efficiency, and automation of dozens of functions that were previously performed manually by finance teams.
However, switching to automatic methods from manual ones does not mean firing your finance team completely. It simply means you will need fewer individuals, will be able to save money, and complex businesses tasks will be made more straightforward:
- Variance analysis, account reconciliation, and other taxing tasks are performed within minutes by automated software, saving time
- Reports have shown that nearly 80% of Excel sheets have inaccuracies that damage business processes and profits
- Better consistency is achieved as double-entry and tallying by multiple people is eradicated. Even the finance team size is reduced which means less manual work, data gaps, and mistakes
- Real-time data can be used to report problems, and fix inconsistencies before things go out of hand. The chances of loss are, therefore, easily eradicated
- Even though most businesses trust the finance team members they hire, the chance of fraud cannot be easily eliminated. Automation prevents fraud and makes financing processes smoother and more secure
ENDNOTE
With tons of benefits, finance automation software brings there should be no doubt that all businesses need to invest in one. Automating the financing processes not only increases accuracy, speed, and profits but also sets you at par with other companies that have already adapted to modern ways of handling business expenses.
