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AP Automation: Getting Started with Accounts Payable Automation 

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What is accounts payable automation?

Accounts payable automation, also known as AP Automation refers to the automation of tasks within the accounts payable process so that manual tasks are eliminated and instead carried out by automation software.

Many organizations are still processing their invoices and making payments manually, using a combination of paperwork and email, which is a drain on time and resources for this essential, yet slow and repetitive process. 

 

Why should I automate the AP process?

Like most things, it essentially comes down to two things that we never have enough of: time and money.

Accounts payable professionals surveyed by IOFM spend 84% of their time bogged down by a seemingly endless list of manual and semiautomated invoice processes, including data capture. The IOFM also found that 63% of companies see reducing invoice-processing costs as their number one priority. 

Automating the AP process reduces labor costs and reduces cycle times, ultimately saving time and money, along with additional benefits…

 

What are the benefits of automating the accounts payable process?

  • Improve speed and efficiency – Time-consuming tasks in the process, such as data entry, are automatically completed in minutes
  • Save money – Automating steps in the process reduces labor costs, as well as ensuring that deadlines are met, avoiding late fees and resulting in an overall lower cost per invoice 
  • Reduce errors – The margin error is significantly reduced as data does not have to be manually copied from one source to another 
  • Ensure compliance – Processes are predefined so you can rest assured that you will always meet regulations and prove compliance with automatically generated audits
  • Provide visibility – Audit trails will show you exactly what has occurred in the process and you can dig into any point in the process to see how invoices are progressing 
  • Scale easily – As with other business processes, automation can easily be deployed and scaled up based on demand

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AP automation in action

The Hong Kong division of a global apparel vendor used Bizagi within its global sourcing function to reduce the cost of sourcing while increasing accuracy and visibility of the process. They are transforming the accounts payable function by using ABBYY OCR to read the data on the invoices, before passing it to Bizagi for approval.


How to automate accounts payable


To automate the AP process with Bizagi, you can download a free process model from the Bizagi Xchange. This will automate the acceptation, validation and approval of invoices. The process also allows the devolution of invoices when they are received with incorrect information, or when products or services do not meet specified requirements.

As detailed in our blog, How to Automation Your Finance Processes, “Bizagi ensures that tasks within the accounts payable process are automatically assigned to the correct employee, starting with the receptionist and the receive invoice task. If the invoice has been associated with a purchase order, the information is automated to populate the forms. If not, then the user can enter the information manually.

“Then it passes on to the financial assistant who will validate the invoice by filling in the necessary information on drop-down forms in Bizagi. After approval, the accounting entry is automatically created in your company’s ERP, so the invoice is available with the correct information to perform the payment. This means you can rest assured that all elements of the process are being completed efficiently and accurately.”

 

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