ACCOUNTING: Five Steps to Reducing Invoicing Costs
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Commenting on a 2006 study published by market analyst, the Aberdeen Group, on 150 ‘Fortune 500’ companies (60% US, 35% Europe and 5% Asia), Bateleur Software’s June Julyan said that the invoice costs ranged between R8 and R630 per invoice according to the level of automation. “Surprisingly, there is still a lot of manual paper intensive workflow – by automating the whole process, we can deliver value at every step.”
Kofax’s May 2008 White Paper called ‘5 Steps to Automating Accounts Payable’ outlines how to achieve Process-Ready Data accurately and efficiently, while cutting costs and driving new revenue-generating processes immediately. The comprehensive, flexible suite of software streamlines invoice processing in five simple steps:
1. Controlling the Paper Workflow
2. Automate Data Extraction
3. Increase Process Transparency
4. Electronic Data Exchange
5. Improve Data Quality
Julyan, who represents Kofax locally, elaborated: “Step one is a major business challenge because most invoices are still received via postal mail, often through different entry points, and then forwarded manually to the Accounts Payable (A/P) department. Invoices are lost and misplaced, processing is delayed, there is no visibility of outstanding payments and early payment discounts are not cashed in. Scanning efficiently at entry point, invoices get captured immediately and securely stored in a digital format.
“Step two reduces manual labour by automating data extraction with a very efficient, inclusive, and cost-effective information capture process. Increased data accuracy and simplification of the process means significant cost reduction and compliance with regulations, as well as higher supplier and employee satisfaction. Then, step three, by increasing transparency of the invoice process, we reduce costly disputes between buyers and suppliers.
“Step four is important because 10% – 15% of suppliers place inbound calls to A/P to find out the status of their transaction and by enhancing process transparency and exchange, workload is reduced, costs are lowered, compliance achieved and service is improved. Finally, improving data quality eliminates a myriad of errors that emerge in the process – it enables Straight Through Processing (process-ready data) that significantly improves matching rates and reduces costs.
Julyan concluded: “Kofax offers an efficient, inclusive, and cost-effective invoice processing software suite that allows you to digitally send and receive invoices without paper. Each part of the five-step solution described above uses the parts implemented in earlier phases as a foundation to build upon, allowing for maximum flexibility – all reducing time, improving accuracy and speeding up payments.
“More than simply cost-cutting, Kofax is about cash management and increasing turnover, the five-step automation process will result in a streamlined, cost-effective, business process that will help save your company money, and make you more competitive in the future.
“In addition, once the document and its data has been captured in digital format, companies could decide to store it in a content repository, such as ASG-Mobius ViewDirect repository. The benefit of doing this is that the document now becomes ‘always available’, to multiple people within the organisation, both now and in the future.
“In fact, users could even be given access to documents from outside the organisation, once again fuelling productivity, transparency, independence, while still complying with regulatory stipulations and audit requirements .
“What’s more, the data is ingested and linked to the customer ERP system, enabling ease of access to both documents and information thereby facilitating the payment and subsequent enquiry process – and it can all happen automatically,” she said.
Business News Sector Tags: Finance| Infotech|