Accounts payable is sometimes the most neglected component of the finance department, as it does not generate revenue for the company. In fact, this is far from reality. Medium to small companies usually overlook the importance of Accounts payable and leave it to unskilled hands, which results in severe financial loss, loss of reputation of the company and loss of opportunities for saving money. Inappropriate management of AP can also lead to decrease in a company’s credit rating, which directly affects its production and performance capacity.
Any company’s output depends on its dealings with its customers and vendors, while the later directly affects the company’s performance and services. This is the reason why absolute attention should be paid to manage a vendor’s account, besides paying attention to their quality. Managing invoices is not merely data entry and can lead to losses through duplicate payments and missing opportunities in availing discounts, which directly lead to financial losses. In the last two decades, a lot of transition has taken place in favor of paperless environment.
Unfortunately, this is more in theory than in practice. In fact, in the preceding years the use of paper has increased due to electronically sent invoices, which require companies to use their own paper for printing out invoices received via fax or email. Manual processing of vendor invoices remains standard procedure even for businesses using top of the line ERP and AP solutions, even then their dependency on paper driven processing continues. Both procedures increase the cost of processing vendor invoices by a great margin. Automated data entry is the ultimate solution, which can easily resolve all the challenges that crop up due to human errors that cause losses to any business.