Automation

Organizations seeking scalability for expansion, wishing to increase transparency and become “audit proof” or simply looking to increase their bottom line can choose from multiple packages, technologies and solutions to automate their AP Processes.  It’s important to understand what is available and what has worked at other organizations.  RPI can help your organization evaluate its needs, weigh various options and pick the right solution.  Our experts can also assist in the development of a business case and ROI estimates.

Document Imaging

Paperless Accounts Payable environments significantly outperform their more traditional paper based counterparts. Eliminate the manual-intensive process of filing, retrieving, and re-filing invoices.  With document imaging, AP, finance, audit, and other staff can view invoices without leaving their desk.  Integration with ERP systems allows for invoices to be viewed while reviewing AP or GL records. 

Document Imaging is not only for invoices.  Statements can be scanned to facilitate statement review and provide statement history.  W-9 forms can be scanned and linked to vendor records to allowing for easy retrieval during an audit.  Vendor request forms and vendor correspondence can be scanned to provide a more complete history of a vendor relationship.

Increased visibility of unentered invoices allows for better workload management as the number of invoices waiting can be determined at anytime.  Invoices pending entry will be entered first-in, first-out, rather than today's stack of invoices being put on top of yesterday's stack. 

Workflow

OCR (Optical Character Recognition) 

Organizations that have embraced OCR in Accounts Payable have reduced invoice entry time by as much as 60%.  OCR software packages leverage the latest in sophisticated template and pattern recognition technologies to identify and extract invoice information from scanned images.  In electronic from, data can easily be verified by an Accounts Payable processor and validated against an ERP or Accounting packaging before being directly uploaded. This is the next step in the evolution of accounts payable from the data entry centric role of past into an audit based organizational function.  It is not cost effective to pay resources to enter data in our economy, one reason why outsourcing has become an increasing consideration for many executives.  

OCR offers a cost competitive alternative and an opportunity to transform the traditional responsibilities surrounding invoice processing.  The reallocation of AP processors to roles focused on data validation, invoice and payment accuracy, fraud prevention, statement maintenance, RNI reduction and process improvement can significantly alter the operation, efficiency and organizational value offered by a Payables department. OCR is a relatively new technology that many software companies claim to offer, but the capabilities and value vary significantly between packages.  While the best OCR technology can be expensive, most organizations achieve ROI within one year through the re-assignment of staff to other functions or the expansion of processing capacity.

Purchasing Cards

Purchasing card programs offer an efficient alternative for small, routine transactions. Purchasing or corporate cards reduce the overall volume of transactions flowing through Accounts Payable and create a more efficient purchasing mechanism for small dollar transactions that require detailed tracking and communication between the requester and vendor.  In addition, most purchasing card programs offer rebates to participating companies that can reach up to 1% of expenditure volume. Many organizations are concerned about fraudulent use of corporate credit cards.  Properly implemented however, a purchasing card program will increase, not decrease, the controls and visibility surrounding these transactions.  Current programs offer functionality for supervisor approvals and controls, transaction type and dollar amount restrictions, and pattern-based or random audits.  The efficiencies of purchasing cards can be gained while decreasing the risk of fraud.

EDI (Electronic Data Interchange)

Electronic submission of invoices can reduce data entry time for primary vendors by 75%.  All ERP systems are equipped to handle electronically submitted invoices and almost all major vendors offer the service.  Properly configured, an 810 record (electronic invoice) can be automatically retrieved, validated and uploaded.  Based on system purchase order and receipt information and existing ERP functionality the invoice can be matched and automatically processed for payment or left for exception processing.  Time dedicated towards receiving, sorting and entering the invoice is replaced by ensuring 810 data is flowing smoothly into the system.  Once everything is working smoothly a single processor can easily be responsible for 10,000 invoices a month.  Most organizations have already made strides in implementing EDI functionality for the outbound transmission of 850 (purchase order) records as well as the inbound 855s (vendor acknowledgments).  Yet many have not fully embraced EDI for 810 records, creating a significant opportunity to leverage internal technologies and intellectual capital to drastically reduce invoice entry time.  Because a handful of vendors typically represent a large percentage of overall invoice volume most companies can quickly ramp up to receive 40% to 50% of invoices via EDI.  New technologies and third party vendors are offering alternatives to convert transactions for non EDI providers into electronic format, allowing a higher % of ROI. 

Outsourced Disbursements

Accounts Payable departments can save time and money by eliminating the steps involved in printing and mailing checks.  Though ACH technology has existed for years, over 90% of the payments made today are in the form of a paper check.  This is a labor intensive process that can involve printing and folding checks, putting them in envelopes, adding postage and mailing, not to mention dealing with jammed printers, reprinted runs, enclosures and secondary signatures.  Many banks now offer full outsourcing of check production and mailing with pricing that is significantly lower than the cost to print and mail the checks internally.  Check files are created from an ERP system through existing functionality and transmitted to the bank.  There the process benefits from efficiencies of scale and reduced cost of bulk postage through zip code sorting, keeping the cost per check cheaper than in-house check production.