Accounts Payable Services
The Accounts Payable process involves much more than just paying invoices. An effective Accounts Payable (AP) process
includes processing invoices, workflow approval, purchase order matching, dispute resolution, payment processing, reporting/reconciliation, status review, and maintaining adequate documentation. It is important to have a clear understanding of the entire AP process.
Challanges of in-house Accounts Payable department
Inaccurate Data
One of the biggest challenges faced by the Accounts Payable department is inaccurate data. This can be due to manual data entry errors, incorrect coding, or lack of clarity in the invoicing process. This can lead to errors in the payment process, which can be costly and time-consuming to fix. One must ensure that all invoices are accurate and paid in a timely manner, while also adhering to the organization’s financial policies and procedures.
Risk of Errors
A single error can have a ripple effect on the entire organization. Disappearing invoices, double entry of a single invoice, matching errors, lack of audit trail, and the list can go on. There can never be an end to the risks.
Payment Errors
Payment errors can occur due to incorrect invoice amounts, due to wrong payment methods, paying invoices before receiving the product or the service, or double payments. It is responsible for processing invoices and making payments to vendors and suppliers. Errors in payments will impact negatively on your cash flow.
Unauthorized Purchases
The risk of unauthorized purchases can happen when someone makes personal purchases using company funds or make unauthorized business purchases without going through the proper channels. This can lead to losses for the company and can also lead to delays in payments if the purchases are not properly documented.
Approvals Delay
Making a payment to the vendor needs approvals from various stakeholders. However, approvals can sometimes get delayed, which can impact the. This can happen when invoices are not properly approved before they are sent for payment. This can lead to delays in payments and erroneous payments.
Benefits Of Outsourcing Accounts Payable?
01
Save Time and Cost
As a business owner, you are always looking for ways to save time and money. Accounts Payable outsourcing canprovide improved cash flow, increased efficiency, and reduced costs.
02
Approve payments via e-mail
With everything going digital, why not ditch the paperwork and go environment-friendly? You can share all the invoices, reports, and statements via email and get them approved without any hassle. Document sharing and approval process is easier and quicker for teams to collaborate via email as it reduces manual errors.
03
Record management (the best part)
Having all the records in one place is good. But retrieving THE invoice from those records is a task. When you outsource your Accounts payable to a service provider you also get the advantage of having workflow management. You can always have access to all your records.
04
Get Payment Advice
Outsourcing Accounts Payable can bring in more advantages than you think it does. As the name, Accounts Payable, suggest, payment processing is the heart of this process. And this is where one can go wrong in a million ways. An AP service provider also ensures you are processing the payments for the right invoices at the right time. Not early, not late.
05
Head-count scalability
You have the benefit of not increasing your in-house headcount and yet scaling your team according to your AP needs. You save on infrastructure and focus on growing the team that brings in ROI.
06
Increased productivity
As mentioned earlier, an effective outsourced team will workflow management, invoices are automatically routed to the right person throughout their lifecycle. This automated workflow management saves time and energy which is invested in being productive.