AP automation AI that automatically reads invoices and syncs the right information. And sends you real-time notifications for invoices that need your attention.
Set up custom AP approval policies with any combination of approvers, spend limits and department structures. Don’t want the hassle of creating approval policies? Let our AI handle it.
Set up advanced invoice or PO matching rules with automated 2 way or 3 way matching. Flag duplicate invoices, variations in PO/receipt details, and prevent vendor fraud.
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Discover important details about automated accounts payable and Nanonets' accounts payable automation software.
Accounts payable automation, or AP automation, is the use of technology and software to automate the tasks and workflows involved in the accounts payable process.
This process includes tasks such as receiving/processing invoices, data entry, approvals and payment.AP automation aims to improve the efficiency, accuracy, and speed of the accounts payable process. It also reduces manual workload, the likelihood of fraud and costs for businesses.
Accounts payable (AP) automation essentially presents an automated workflow that includes invoice capture, data entry and validation, approvals, payment, and tracking/reporting.
AP automation software use a combination of OCR, AI and machine learning to read and digitize important information from vendor invoices. The AP automation workflow can then verify and validate the data and then route it for mandatory internal approvals. Once successfully approved the invoice can be processed for payment.
The entire process is tracked and reported in real-time, providing visibility into the accounts payable process and aiding with compliance, auditing, budgeting, and forecasting.
Accounts payable automation offers various advantages that can significantly benefit businesses. This includes improving accuracy, automatic invoice matching, integrating with accounting software, streamlining invoice approval and providing audit trails.
One of the most significant advantages is the reduction of processing costs by minimizing the need for manual effort. As businesses grow, this automation can also aid in scaling AP processes without requiring additional hires. AP automation also reduces the risk of fraud and errors, leading to smoother audits and accurate financial records. Another valuable tool offered by AP automation is the ability to manage payments and cash flow efficiently. By streamlining the payment process, businesses can increase their ability to capture supplier payment discounts and improve cash flow. AP automation can also help ensure compliance with regulatory and legal requirements and reduce the risk of fraud.
AP automation can bring cost savings to businesses by reducing labor costs and late fees. While the costs associated with traditional paper-based payments such as check stock, envelopes, and postage are easily identifiable, there are also costs associated with the time spent on manual tasks related to processing payments.
For example, even a single document scanned by a salaried clerk earning $40,000 per year can take 5 minutes of their time and result in an estimated cost per document of over $2. These costs, when added up, can significantly impact the overall cost-effectiveness of the AP process. Additionally, with manual AP systems, team members often spend hours on tasks such as searching for lost or misplaced invoices, and answering inquiry calls.
According to a 2018 report by Goldman Sachs, B2B businesses in North America spend $187 billion annually on AP processing - and this estimate captures only direct processing and labor costs; in fact, labor accounts for over 90% of direct costs incurred.The costs of automated AP processing, according to the same report, are only 33% of manual costs. This amounts to an annual spend of only $62 billion, a whopping savings for AP departments.
AP automation software, like Nanonets, streamlines the accounts payable invoice approval process by identifying the correct approvers, sending notifications, and automating reminders.
Invoices are routed through an automated workflow for approval by the appropriate parties. This process can be configured to include different levels of approval, depending on the value of the invoice or the department it is associated with. AP automation can also identify and intelligently handle exceptions and route them to the appropriate individuals for further action.
The automated workflow makes it easy to track and monitor the approval process, ensuring that invoices are processed in a timely manner and are not kept pending.
AP automation software enhances the efficiency of the accounts payable (AP) department by establishing a clear distinction of responsibilities both within and outside the team. Effective segregation of AP duties is crucial for robust internal controls, which in turn helps to prevent fraudulent activities, align responsibilities, and redefine roles to align with the automation process. By accomplishing these objectives, a business can improve the AP workflow, save time, and cut costs. Overall, the implementation of AP automation software facilitates better management of AP duties and increases the accuracy and security of financial processes.
AP automation software such as Nanonets can significantly assist AP teams in reducing costs by 80% for businesses, increasing the speed of processing invoices by up to 10 times, optimizing AP days, eliminating inaccuracies caused by manual checks and verifications, and identifying/eliminating fraud, theft, double payments, and other inefficiencies.
Most AP automation software provide AI-powered financial control features to prevent vendor or payment fraud. These include vendor level controls, AP access control for different employees, invoice matching (2-way, 3-way etc.) and advanced data mining to detect patterns & deviations indicative of fraud.
Nanonets can flag duplicate invoices or invoices entries that have been modified, prevent users from approving payments beyond preset limits or automatically add additional approvers, and also highlight unusual variations in vendor payments or AP activities.
AP automation systems can work with accounting systems; many systems have various integration options, such as API or middleware, to provide seamless data transfer between the different systems. This way, AP automation software can retrieve data such as invoices and purchase orders from accounting/ERP systems, process them and then update the information in the external accounting platform.
With such native integrations, businesses can take advantage of the AP automation software's features and automation capabilities, while still using the accounting/business software of their choice. Nanonets, for example, can be integrated with other accounting systems, such as QuickBooks, Sage and more.