AP Automation: A Time Machine for Auditing and Compliance

In finance, auditing and compliance are the most crucial aspects to ensure a business's ongoing health and integrity. However, the original way of completing audits and ensuring compliance is becoming dated, time-consuming and highly labour-intensive. This leads to stressful situations for employees and a chaotic work environment for financial professionals. Fortunately, there is a foolproof solution, which is Accounts Payable (AP) automation, that has the power to revolutionise how businesses manage their financial records, like a time machine for auditing and compliance. 

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What is AP Automation capable of? 

AP automation refers to the use of updated technology and software solutions that can completely digitise the accounts payable process in a business from end to end. These processes traditionally include tasks such as invoice processing, approval workflows, payment processing and reporting. Implementing automation software to streamline these tasks will reduce manual data entry and offer real-time visibility into financial transactions. 

The Time Machine Effect 

There are many ways in which businesses can utilise AP automation to act as a time machine for auditing and compliance. These are the key ways: 

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Efficient Invoice Processing: Before digital solutions and the era of automation, invoice processing was a task that involved paper-based documents, manual data entry, and other approvals, which could be incredibly time-consuming. Automating the accounts payable process results in an accelerated process that automatically captures data from invoices and matches them to purchase orders and receipts. Automation can speed up the invoice process in ways that have never been seen before and ensure that financial records are up-to-date and accurate. 

Enhanced Accuracy: Accounts payable automation can significantly reduce and almost eliminate the risk of human error often seen in manual data entry. The accuracy provided by automation software is crucial for compliance and keeping up with ever-changing industry standards, as mistakes can lead to financial losses, regulatory violations and potential legal issues for businesses. 

Improved Documentation and Accessibility: All financial transactions performed in digital AP software, including invoices, approvals and payment records, are stored in a cloud-based or centralised system. This creates a digital audit trail that makes retrieving and reviewing accurate historical data simple. This means auditors can access necessary information more efficiently, ensuring a smooth and efficient auditing process. 

Real-Time Visibility: AP automation can provide real-time insight into various forms of financial data. This tool allows business leaders to monitor spending, cash flow, and compliance metrics consistently. This helps with staff management and enables auditors to access recent reports. Reducing the need for intensive end-of-year audits and ensuring compliance issues are addressed in a prompt manner. 

Automated Audit Trails: AP automation software can gather data by the minute to maintain detailed audit trails documenting all steps in the invoice and payment process. This provides a level of transparency never seen before prior to automation and provides auditors with transparent and verifiable records of all financial activities. 

Regulatory Compliance: Many industries today are expected to be subject to regulatory requirements such as the 1988 Australian Privacy Act. When implemented in the country of origin, AP automation systems will often be configured to enforce compliance with these regulations by implementing tools such as approval workflows, access controls and encryption. 

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Accounts payable automation has transformed business finance departments and will continue to do so by increasing efficiency, accuracy and overall compliance. AP automation acts as a time machine for auditing and compliance, ensuring data accuracy and real-time visibility into financial activities. As time passes, businesses will continue adopting automated solutions, saving time and money and ensuring regulatory compliance. The future of finance and accounting is an automated one, ensuring auditing and compliance will be a smooth journey for all. 

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Learn how you can get audit ready with Alii today!

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