Talk to any small to medium size business and most will say one of the most critical software systems they use on a daily basis is their accounting software. Generally, this software will help business owners manage all of their business matters including accounts payable, accounts receivable, payroll, financial reporting and budgeting.
For many small to medium businesses, long gone are the days of manual accounting systems and bookkeepers drowning in paperwork. Today we see a number of convenient and efficient cloud-based accounting systems that are extremely intuitive and easy to use.
Three of the most popular accounting systems today are Xero, MYOB and Reckon. Each of these software systems are available online,have dedicated apps for use on smartphones and tablets, and are relatively cost effective with monthly billing options available.
Over the last few years in particular these accounting systems have improved dramatically and now also include the ability to store digital copies of relevant documents and files, as well as the ability to tailor automated workflows around key business process such as invoice approvals, and employee expense and timesheet approvals. These features have greatly improved the convenience and efficiency of these software systems, however some small to medium businesses still need more.
There are a number of accredited developer partners that provide third party solutions that integrate with Xero, MYOB and Reckon to further improve the capabilities and functionality of processes around these systems.
One area in particular where small to medium businesses constantly look for improvements is in automating their accounts payable process. Once the creditor invoice is entered into one of these accounting software products it is an easy task to process these payments. However, once businesses start to process a number of invoices there can be a need to automate some of the other tasks associated with other creditor invoice processes.
Additional efficiencies that businesses look to achieve are generally in one of the following areas:
- Capture – to reduce data entry time and improve data accuracy.
- Workflow – for improved invoice approval processes.
- Storage – to reduce reliance on paper-based documents throughout the process.
Adding a creditor invoice and an electronic copy of the document into Xero, MYOB and Reckon is a relatively easy task if you are doing one at a time. However, once you need to add in several each day this can be time consuming, and prone to errors in data entry accuracy.
One of the simplest ways to improve the automation of your accounts payable process is to automate the capture process. This includes the capture of the data required from the creditor invoice as well as a digital image of the creditor invoice.
By deploying a dedicated capture module that integrates with Xero, MYOB or Reckon, businesses can automatically capture an electronic copy of the creditor invoice (from scanners, email, import folders) and intelligently identify and extract the required data from the invoice (supplier name, invoice #, invoice date, invoice amount, purchase order # etc.). Some businesses might then need to validate the captured data against a purchase order, stock code, or supplier ABN. In addition, they might have the task of validating invoices shared or checked amongst several employees.
This process of data capture, validation, and image capture can be automated with third party business technology services provided by accredited developer partners. Such applications integrate directly with Xero, MYOB and Reckon to look-up their database in real time to validate and verify data. It can also allow for new suppliers to be automatically created if one does not exist in the database.
Once the data is captured the data file and supporting digital images of the invoices are automatically imported into Xero, MYOB or Reckon for processing. This saves a great deal of time in data entry and greatly improves data accuracy.
Xero, MYOB and Reckon have greatly improved their ability to approve invoices within their system electronically. Today these approvals can be managed completely within the accounting system provided the approvers have access.
However, what if a business wants a more sophisticated business workflow application. One that can manage creditor invoice approvals but also other key business workflows such as customer order processing, timesheet approvals, or vehicle maintenance checks. If this is the case, then third party business technology services from accredited developer partners should be considered.
For creditor invoices the most common workflows are built around the processing and approval of invoices. These tasks might include the need for a second staff member to verify the invoice has been entered correctly, confirming with the warehouse that the items have been received, verifying the invoice against a purchase order, approving invoices, or filing and archiving the invoices each month.
Each of these workflow steps and tasks can be automated and employees will receive notifications when they have new tasks to perform based on a pre-defined set of tailored rules and conditions. This provides complete transparency and audit capabilities on all invoice processing tasks.
Copies of financial documents must be kept for up to seven years. Each of the major accounting software systems allow for these documents to be attached digitally within their systems.
However, what happens if you want to store digital copies of other documents such as customer order forms, marketing materials, contracts and agreements because these systems do not allow for these other documents to be stored and retrieved?
The answer is, that many businesses look to deploy a dedicated document management system from an accredited developer partner that integrates with the accounting system. That way they can digitally store and archive their financial documents as well as other business documents and files. These document management systems also come with more sophisticated document storage and retrieval features such as open text search, meta data fields, and interactive viewers to add notes and mark-ups etc.
With complete integration with Xero, MYOB and Reckon, the digital copies of the creditor invoices can be easily viewed through an integrated document viewer without the need to switch between systems.
A robust and efficient accounting software system is critical for small to medium sized businesses. However, there is more that businesses can do to improve their accounts payable processes within these systems.
An accredited developer partner is the starting point for many businesses, as the services from these businesses are tested and proven by each accounting software provider.
Colourworks Australia is an accredited developer partner for Xero, MYOB and Reckon. Through our product Autofile™, we provide businesses of all sizes, in all industries with a complete business technology service in automating your ‘Purchase to Pay’ process with seamless integration with these accounting systems.