Accounts payable departments no longer can plead the Fifth on financial reporting. Businesses are requiring accounts payable departments to offer greater real-time visibility into financial information than ever, according to the Institute of Financial Operations (IFO).
But paper processes make financial visibility a challenge:
- Key information is not captured
- Data is poorly organized
- Information is not timely
- Systems are not well-integrated
- Decision-makers don’t have access to key variables
In fact, two-thirds of organizations say that invoices, purchase orders, supplier correspondence, supporting documentation and contracts are not easy to find, according to the Association for Image and Information Management (AIIM).
It is no wonder that more than two-thirds of controllers surveyed by Institute of Financial Management (IOFM) cited improved visibility into cash flow/cash management as a top objective. That’s where automation comes in.
Electronic invoicing improves visibility into accounts payable in four ways:
- Invoice tracking with detailed audit trails
- Interactive dashboards with information on cash flow, and liabilities to suppliers
- Integration with enterprise resource planning (ERP) solutions and other back-end systems for 360-degree real-time financial visibility
- Anytime, anywhere access to archived invoices and data by authorized individuals
This visibility delivers benefits across the enterprise:
- CFOs gain access to organizational cash flow with the ability to drill down.
- CPOs can access category spend and volume, purchasing trends, timeliness of payments to suppliers, supplier performance metrics, and procurement and contract compliance metrics.
- AP Managers can view transaction volumes and values, process metrics, staff productivity and accuracy, and performance against continuous improvement objectives.
- Line of Business Managers can create budgets based on actual spend, track spend against budget, create forecasts based on actual spend, and access vendor metrics.
It is no surprise that 41% of senior finance executives surveyed by IOFM in 2014 identified improved visibility into invoices and payables documents as the top benefit of automation.