In my last two blogs of this series, I made the following statements:
“In the past Accounts Payable (AP) and Accounts Receivable (AR) were rarely spoken about in the same breath.”
“In most cases small companies start out with AR and AP being done by the same person. That person has all the information at their fingertips so they can make instant cash flow related decisions regarding collections and payments.”
The full pieces are available at Are You Prepared for the Convergence of Accounts Payable and Accounts Receivable? and Accounts Payable and Accounts Receivable are Converging. They discuss the past and present shifting landscape in the accounts payable and accounts receivable world. This piece will discuss where I see the future shifts occurring and how to prepare for them.
A number of companies with forward looking CFO’s and Controllers are already taking or are starting to take steps to automate their AP and AR processes. I think it is old news, but it turns out that manual processes aren’t efficient. The benefits of faster processing and increased business intelligence makes moving to an automated process an easy decision. Using cloud-based technology allows all documentation from a multiplicity of systems to be linked together for each transaction in a single, digital repository. This allows companies to have instant access to all of their documents to eliminate duplicate payments, avoid missing early pay discounts, dispute short pays, reconcile electronic payments and invoices, and provide better business intelligence.
An additional benefit of using a cloud-based solution is that it can provide an easy way to manage both accounts payable and accounts receivable in a single system. As this happens, businesses can move towards the convergence of AP and AR that I discussed in the two previous pieces.
The one common quality of all successful, forward-looking financial professionals is that they prepare for the future. In the finance and accounting industry, there is no one who knows exactly what the future holds, so the only way to prepare for it, is to be flexible enough to deal with any situation. This means having technology that can manage the processes in AP and AR that is adaptable to fit the situation.
These financial professionals are choosing flexible technology that allows them to solve issues associated with their most onerous processes and that allow them to continue to add processes to ultimately complete the full convergence of AP and AR to optimize cash flow and provide vision to make the best financial decisions for their companies.
An example of the automation that technology can provide is shown in this video.
