Finance Processes improvement to Save Time & Money

Finance and accounting professionals play a vital role in driving business growth and strategy, but most businesses underutilize this important resource because their finance teams are bogged down in inefficient finance processes.

With all the technology solutions available today, core tasks including, Stock control, cash management, invoicing, and expense management can be automated with relative ease, not only reducing inaccuracies and delays but freeing up your finance team to perform more useful and value-adding work.

To thrive in today’s competitive business environment, businesses need to make concerted efforts to use their resources as efficiently as possible. Streamlining and optimizing finance processes is one of the most important investments a business can make to help ensure long-term sustainability.

Below are some of the common challenges businesses experience concerning accounting and financial processes.

Inefficient Processes

Outdated systems result in information silos that make finance processes more complex than they need to be. Inefficient reporting processes take a toll on productivity and cause members on the finance team undue stress. Moreover, subjecting intelligent and highly qualified finance professionals to tedious, repetitive manual work (e.g. data entry) not only encourages burnout but prevents them from applying their talents in more productive, strategic ways that could help grow your business.

Fraud

Fraud is an ever-present threat that requires constant vigilance to prevent. Fraudulent billing information and murky manual accounts payable systems are the primary causes of fraud, with instances ranging from invoices that don’t match expenses to check to tamper. Implementing a solid approval process that prevents individuals from signing off on particular invoices in isolation can foster the necessary visibility and oversight to prevent fraud.

Inability to Manage Information

Accounting involves mountains of information and documents, which can be overwhelming for many finance teams. Properly managing, storing, organizing and tracking all these documents can be challenging, particularly for businesses that use manual systems. Given that all these documents need to be easy to find again later to double-check the information and for audits – only adds to the challenge.

Manual Data Entry Mistakes

Manual data entry is a highly inefficient process that not only takes a lot of time and resources but also results in errors, making the business vulnerable to serious financial repercussions. Simple mistakes can result in underpaid or overpaid invoices and several other errors that can cause trouble further down the road.

Slow Approval Processing

Manual approval processes can result in a slow, complicated payment processing system, which can lead to late payments and purchase order delays.

Slow payments can result in dissatisfied suppliers, which can lead to additional charges or even suspended accounts and even impact other vendors’ willingness to work with your company.

Purchase order delays may result in projects running behind schedule and can even lead to delayed product rollouts, which can have far-reaching detrimental effects on a business’s reputation.

Lack of Visibility

There’s an inevitable lack of visibility and oversight that comes with relying on paper invoices and other documents. It’s almost impossible for your accountant to know off the top of their head precisely when each invoice was issued, when/whether the payment was made, or whether the payment has cleared. Manually tracking and logging each stage of each account and communicating the status of the transaction to suppliers and other stakeholders requires a lot of admin, most of which could be automated.

Another drawback of a manual system is that the lack of oversight leads to a lack of insight into trends in the business’s financial operations, such as data showing spend patterns, productivity levels, and overall operational efficiency. However, with automated finance processes, it’s easy to analyze this data and generate reports which can help to set the course for the business going forward.

Disappearing Documents

When there’s a backlog of documents waiting to be processed manually, it’s not uncommon for emails or paper documents to be temporarily misplaced or completely lost. For example, in businesses that lack efficient accounting workflows, lost invoices may result in the accounts payable department having to waste time contacting suppliers to request replacement invoices if at all they notice that the invoices are missing. If they don’t, you’ll be in the embarrassing situation of having to explain to your suppliers why you haven’t paid them. Moreover, missing invoices can result in an inconsistent paper trail at audit time.

What is Finance Process Improvement?

Finance process improvement involves making changes to your finance workflows to increase efficiency. Process improvements can be as simple as creating more formalized guidelines for employees to follow when completing tasks such as submitting expense claims. On the other hand, using technology to automate your finance processes can have a significant impact on consistency, speed, and accuracy, making it easier to meet your business goals.

Call us today to discuss your financial process improvement needs