AP invoice automation

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Leverage AP data to become your CFO’s super hero

Companies have much to gain by leveraging the data derived from supplier invoices to improve accuracy and timely delivery of finance reports, identify hard savings opportunities and process improvements.

In these times of digital transformation and rapid business developments, we need to stop viewing the accounts payable function as purely transactional. In fact, companies have much to gain by leveraging the data derived from supplier invoices to improve accuracy and timely delivery of finance reports.  

In this blog post, I’ll share three ways to leverage AP data in a way that will make the AP team shine and gain appreciation from the business and from your CFO in particular. 

Improve cash flow management with AP data 

Supplier invoices hold many critical data points for finance reports – amounts in workflow, outstanding invoices to be paid and overdue amounts. Often, this data sits in various systems, inboxes, or worse – in paper stacks on people’s desks. It’s hard to consolidate all this dispersed information and present a true picture of the current status of the company’s most valuable asset – cash. 

A modern AP invoice automation solution will support finance reports in several ways: 

  1. Gather all invoice data in one system – digitally accessible and searchable at any time 
  2. Provide accurate and timely AP data to the finance reports ensuring a smoother closing of books every month 
  3. Present easily digestible reports on current unpaid invoice amount and days payable outstanding (DPO) to support cash flow reporting and net working capital analysis 

With these data reports at hand, you will be able to provide a better service to the organization and transition the AP team to a valuable and appreciated business partner, rather than the old-fashioned, back-office function it used to be. Plus, your CFO will have the data needed to monitor their financial dashboard and manage the company’s cash with confidence and ease. 

AP data leads the way to hard savings opportunities 

Many organizations still struggle to pay their suppliers on time and risk being hit with late payment fees and interest charges. An AP invoice automation solution will not only help you speed up your process to ensure you pay your invoices on time. It will also open doors to negotiating and leveraging early payment discounts, which translates to hard savings on the bottom line. 

The AP data that sits in your automation solution should offer intelligence about savings opportunities, including: 

  • Missed early payment discount amounts due to lengthy invoice processing times 
  • Large volume suppliers where discounts have not yet been negotiated 
  • Process bottlenecks causing delays and hence missed discount opportunities 
  • Spend optimization opportunities moving purchases towards suppliers who are willing to offer volume rebates and/or improved payment terms 

For your CFO, each of these bullets represents real money in the bank and can have a truly positive impact to cash flow and bottom line results. Don’t you want to be the one bringing them the good news? 

Use benchmarks to identify improvement areas 

Once you’ve started gathering your AP data in a structured way you’ll want to understand how well you perform compared to others. Industry benchmarks can be used to rank your achievements against similar organizations on standard KPIs. This way you’ll know if your metrics are low, average or best-in-class. Plus, it’s a powerful tool to identify potential issues and drive improvements of your process.  

Use your AP invoice automation solution to measure and monitor important efficiency KPIs as well as financial metrics. With relevant benchmarks at hand you will not only be able to rank your performance against peers but also demonstrate the AP team’s value to the internal organization and continue the journey towards an efficient, value-adding and appreciated AP function. 

As the saying goes: The devil is in the data…! Jokes aside, to become your CFO’s super hero you need to equip yourself with the AP data needed to improve reporting, financial visibility and overall control. Get started today - learn more about our CFO Dashboard

Daniel Saraste

Daniel Saraste

Director of Products

daniel.saraste@medius-group.com