Many businesses face numerous challenges while handling the accounts payable process. Thus, hereâ€™s a PPT describing common accounts payable issues and ways to overcome them.

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COMMON ACCOUNTS PAYABLE CHALLENGES AND WAYS TO AVOID THEM Presented by Cogneesol

Accounts Payable is an essential aspect of a company as it takes care of the finances, maximizes your cash flow, and helps to strengthen relationships with the suppliers. come with their own share of challenges. To handle those challenges efficiently, it is essential to understand them first and learn how much they can cost your business. However, handling A/P processes

HANDLING INVOICES IN PAPER DOCUMENTS Making use of paper-based documents gives birth to challenges like difficulty in finding or managing paper documents, the need for storage and unnecessary expenses on the same. With the business growth accompanies fluctuations in the AP workload, the paper-based system then becomes quite difficult to handle. if you need to manage a large volume of invoices on a daily basis? Certainly, managing paper documents would not be easy at all. Papers are only acceptable if the workload is less, but what

SOLUTION Move your accounting processes on the cloud and this way you can get rid of the paperwork as well as all the problems that come with it.

MANUAL DATA ENTRY OF INVOICES RESULTS IN ERRORS Relying on manual entry of invoice data from paper into the computer is time-consuming and prone to errors. Even a small typing error can create uncertainty in the company’s accounts payable records, which could impact the bottom line.

SOLUTION Invest in a good accounting software that can scan your invoices, upload the data under the account heads and digitize the Accounts Payable Process. If you are using accounting software, make sure it is integrated with the right applications so that data is moved in and out of your accounting system effortlessly and this will reduce the chances of duplicate data entry.

UNABLE TO MANAGE INFORMATION There are a lot of things that need to be handled in accounts payable such as bills, invoices, documents and other information. Managing and tracking all these can be challenging and overwhelming for the AP team, primarily if you rely on manual methods. Storing these physical documents can take up a lot of space, add ongoing storage costs plus you need to organize everything for easy access and audit.

SOLUTION This mostly happens when a business performs AP processes on a paper or an Excel spreadsheet. Replacing the Excel with the right accounting software is an easy way to reduce errors and inaccuracies as well as keep the information up-to-date.

DOUBLE PAYMENT There are chances when vendors send a second invoice, especially if their first invoice is processed immediately. Now you have two invoices floating around your office there are chances you can pay both of them accidentally.

SOLUTION To avoid this, it is best to perform account reconciliation on a regular basis.

FRAUD VULNERABILITY RISK Accounts payable is more vulnerable to fraud as every company’s expenditure goes through accounts payable. AP fraud involves a wide range of activities such as check tampering cons, billing schemes, expense reimbursement scams etc. Without the necessary controls and fraud protection, it is difficult to track any suspicious activity.

SOLUTION Make sure you have all the security protocols in place and there needs to be a dedicated team working towards fraud detection and control.

DELAY IN SUPPLIER PAYMENTS For early payments, suppliers offer discounts and some levy penalties on late payments. To take advantage of these discounts and avoid penalties, you need to process the payments timely. Delay in payment can be due to paper-based systems, inefficient workflow and delays in the approval process.

SOLUTION Always make it a point to pay before or on the due date. This would help in preventing the chances of penalties on late payments.

COMMON AND BEST SOLUTION TO ALL YOUR A/P RELATED PROBLEMS OUR MISSION

OUTSOURCE INVOICE PROCESSING If you have large volumes of invoice data to handle, in that case, outsourcing can be a cost-effective solution for you as it assures that all your invoices are updated on time accurately and paid within the due time period. Another advantage of outsourcing Accounts Payable Invoice Processing is that by doing so, you’ll be reducing your operational costs by 40-60%.

Contact world’s leading and most trusted service provider of accounts payable solutions – Cogneesol. We cater to multiple industry verticals across the globe. Opt for a free trial today!