Any Accounts receivable process has a key role to play, in the success of a company’s bottom line. The invoice collection process must be taken as seriously as the core business process. The process should be organised in such a manner, that there are no leaks in the system and the payments are duly processed on time. Here are some best practices in automation of the accounts receivable process.
Automation of The Invoice Sending Process
In case of both B2B and B2C enterprises where a large number of invoices have to be sent on a regular basis, an automated system sets up a recurring profile to send out these invoices without the need of manual creation and sending of invoices. Auto-bill profiles are setup, to ensure that the payment process is automated as well. A predetermined invoicing and payments schedule is is setup, to ensure that invoices are received by the client in a timely manner and the payments keep flowing in, on time, as well. The credit card details of the client is linked up with the payment gateway of choice and payments are thus transferred in a timely manner.
The Information Carried on The Invoice
An automated receivable process must ensure predefined information to be added on the invoice. Each transaction must have the complete details such are the order information, the client information, the purchase order number, the estimate reference, the due date and other terms and conditions. An invoice verification must be set up to ensure that all the pricing, taxes and other details, sent to the client are error free.
Invoice Delivery and Approvals Process
A process of confirmation that the invoice has been received by the client and is duly approved, helps in ensuring that verified invoices are being received by the client in a timely manner. An automated system ensures that there is no need for taking manual confirmations and approvals from the client. The approval process coincides with the payment process and payments are automatically transferred to the vendor’s bank account, upon approval of the invoice.
Automated Reports Generation
Running automated invoicing reports help in in depth financial analysis and efficient management of business finances. Such reports include – invoice ageing reports, outstanding reports, purchase order reports, estimate reports and tax reports. Such reports help in analyzing the average payment cycle of each and every client for timely corrective action. Automated reports help in efficient management of resources and timely corrective action for any discrepancies in the system.
Integration With The Current Systems and Processes
Automated document management systems ensure paperless management of all B2B documents, in an efficient manner. An automated solution seamlessly integrates with existing ERP and CRM solutions to ensure that there is no need to invest in new systems altogether. This adds to the efficiency of these processes and improves the return on investment. Automated inventory management ensures, goods are back-ordered as soon as they run out of stock and ensures that they are available while in demand.
Automated Payment Reminders
An automated payment process must be complemented by automated payment reminders. In case the payments are not flowing in on time, then automated reminders ensure that there is no need to make manual follow-ups for reminders or collections. A late fee or an interest penalty is also automatically charged in case the payment is not made on the due date of the invoice.
This ensures that the client automatically receives the billing statement on a periodic basis. Automatic updation of clients about the current and outstanding bills helps in saving the time spent on manual sending of statements . This also adds to the comfort level of the client and helps in better client retention.
An automated invoicing solution like Invoicera helps in management of a large number of invoices in an effective manner. Invoicera helps with customized enterprise invoicing solutions, automated accounts receivable management.
Know more about the benefits for switching to a customized invoicing software.