14 Best Practices for Accounts Receivable Automation

Sensitive information is not stored directly, ensuring utmost data protection. The platform operates via certified Level 1 PCI payment processors, providing peace of mind regarding financial security. Implement ongoing, incremental improvements to ensure that your AR processes stay optimized over time, adapting to changes in your business and the market. By staying responsive to evolving needs and preferences, you can maintain efficiency and effectiveness in your AR operations. Accelerate the processing and deposit of customer check payments by integrating your AR tools directly with bank lockboxes. This integration allows automatic pulling and reconciliation of high-volume check payments, bypassing the internal mailroom.

Corcentric EIPP is delivered as a managed service offering to streamline set-up, onboarding, and management. Below are some of the best practices and strategies for successfully collecting accounts receivable. It’s important for any business owner to stay organized and up-to-date on the status of each customer’s account. This way, they can keep an accurate record of the money owed and develop effective collection strategies. We’ve designed Upflow to help you better manage your AR, which in turn increases your cash flow and long-term growth.

Design intuitive AR dashboards to provide real-time visibility into key AR metrics and KPIs, such as average invoice aging, disputed invoices, days sales outstanding, bad debt ratio, and collector performance. These dynamic and interactive dashboards allow you to drill into transaction-level details on demand for any summary metric. Customers can initiate payments at any time of the day through the portal, reducing the need to contact your AR team regarding payments. Ensure that all payment activity is automatically synced back to your core AR system for real-time accuracy, enhancing efficiency and customer satisfaction. Businesses charge convenience fees to compensate the costs they pay to payment processing providers when a consumer pays with a credit card.

Sets up reminders for client payments.

An AR automation solution should reduce costs and DSO time while freeing working capital and providing rich data for payment tracking.It should also offer a seamless and flexible customer experience to encourage fast payments. The easier it is to fill an invoice, the quicker your customer’s AP department will complete the payment.The right AR automation software can reduce time spent on financial close and free your team for more high-value tasks. According to a B2B payments study, organizations that automate AR processes save 23 days on their DSO. With automation, AR teams can process functions 87% faster, and 79% say it boosts team efficiency.

  • AR automation streamlines and enhances AR operations by applying
    digital technology to the low-value, manual tasks that make up a great
    deal of accounts receivable work.
  • Consequently, the time from receipt to deposit is significantly reduced, accelerating funds availability in your bank account.
  • Automate these processes and free up time for your accounts receivable team to focus on higher-value work.
  • Drive accuracy in the financial close by providing a streamlined method to substantiate your balance sheet.
  • Automatically identify intercompany exceptions and underlying transactions causing out-of-balances with rules-based solutions to resolve discrepancies quickly.

The premier choice for comprehensive automated accounts receivable management in 2023 is Cashflow.io. This platform stands out in efficiently overseeing accounts receivable processes, ensuring a streamlined approach to invoicing, payment plans, reminders, and financing. Document each task and activity in detail for a comprehensive understanding. Configure your AR automation software to create streamlined workflows that align with this sequence.

Evaluate Your Software Options

Here are six things you can start doing today to improve team productivity and reduce Days Sales Outstanding (DSO) – and how Accounts Receivable automation software can help. Start today by developing a clear, written set of policies and procedures. Also, create effective communication strategies, implement the right tools and processes, and you’ll be on your way to successful collections.

Top 11 Benefits of Accounts Receivable Automation

Accounts receivable automation delivers key CX gains and alleviates customer frustrations, boosting their attitudes toward your business. Collaboration among team members is necessary to share information and resolve issues, particularly when a customer asks for an installment payment plan or disputes a charge. Instead of having to manually match the payment you received with the correct client invoice, you can rely on your the best free invoice & invoicing software AR tool to do it for you. Upflow for instance automatically gets payment information from your billing tool or payment gateway. On their end, your clients will be happy to have the information they need for their internal payment processing. Accounts Receivable automation supports your AR and has many key benefits, automating your most repetitive tasks and ensuring you have all the info you need at your fingertips.

Research your cash flow history

Corcentric empowers stronger internal controls, improves quality, significantly reduces or eliminates errors such as duplicate payments, overpayments and fraudulent payments, and makes it easier to capture early payment discounts. Corcentric enables your business to contain costs, optimize cash flow, and mitigate risk. Accounting automation software like QuickBooks, FreshBooks, or Xero not only simplifies the collection process for accounts receivable. It also frees up precious time for your team to focus on other aspects of your business.

Make the most of your team’s time by automating accounts receivables tasks and using data to drive priority, action, and results. Effectively managing accounts receivable is crucial for effective
business accounting, which encompasses billing, payments,
collections, and tracking. Your organization’s success depends on
its ability to manage this AR lifecycle consistently and efficiently. In these uncertain economic times, companies of all sizes are increasingly likely to be faced with late payments. With financial margins squeezed by inflation and rising logistics costs, slower collection times can undermine a company’s financial health. If your accounts receivable team is working harder than ever to collect payments and preserve cashflow, it may be time to automate your Accounts Receivables management.

By streamlining your processes, and with automated yet personalized email workflows, it makes your AR more efficient. RELEVANT REPORTING – Your accounts receivable team often must provide insights to colleagues outside of the accounting department, which is why automation reporting is so helpful. The AR team can easily and quickly set filters for ad-hoc reporting and export required data to a variety of formats including Microsoft Office Excel spreadsheets. Begin with a single module, such as invoicing, and progressively expand functionality over weeks and months. Focus on your receivables first, then consider automating payables or offering niche products like customer financing. This incremental rollout minimizes disruption, ensuring a successful and well-accepted transition to AR automation within your organization.

Efficiently manage and resolve customer disputes, which can severely impact cash flow and revenue recognition, by utilizing structured workflows. These workflows facilitate dispute submission, documentation, status tracking, reminders, escalation routing, and settlement. Automating credit checks during customer onboarding improves risk assessment, while real-time transaction approvals limit ongoing exposure.

Initiate the process by thoroughly outlining every step involved in managing accounts receivable. This includes creating and sending invoices, collecting payments, issuing reminders for late or missing payments, managing disputes, reconciling cash applications, and generating AR reports and analytics. Compared to manual labor, software for automating accounts receivables can process thousands of invoices within seconds.