AI in accounts payable helps improve the AP process for staff and provides more visibility for decision-makers.
Organizations are implementing artificial intelligence (AI) technologies to support and augment employee tasks and productivity. In fact, Gartner predicts that by 2027, the productivity value of AI will be recognized as a primary economic indicator of national power. According to PwC in the 2023 Emerging Technology Survey, 73% of US companies have already adopted AI in some area of their business.
AI and Machine Learning – Unlikely Allies for Accounts Payable
AI enables software or machines to understand tasks by producing rules that programmers cannot specify. It learns the tasks that must be performed for a business application by analyzing data sets and patterns. Artificial intelligence software trains itself to recognize documents and perform necessary tasks based on their characteristics, mining data to provide contextual insights and monitoring processes. AI also employs “machine learning” to achieve better results over time.
Accounts payable departments will increasingly rely on AI to do non-routine activities. AI can comb through invoices for pricing errors and discrepancies and review approved invoice files for suspicious activity. That’s not to say that these types of activities won’t require the intervention of human staff. However, AI technology can assist with the work of employees by providing recommendations.
This should be reassuring to AP employees who fear the emergence of AI will eventually spell the end of their jobs. Offloading tasks to AI will free human employees to spend more time on tasks that AI cannot perform. The kind of tasks that require ingenuity and human interaction.
How AI in Accounts Payable Helps Reduce Costs
Accounts payable remains one of the costliest and most time-consuming financial functions. But digital technologies such as AI and machine learning (ML) are changing all that. Digital technologies automate the manual tasks that are the primary driver of high accounts payable costs.
Advanced platforms use ML, natural language processing, AI, and other technologies to continuously learn invoice formats without human operator configuration. The platforms understand the physical location of invoice information and parse data with greater accuracy over time.
Accounts payable software with AI and ML can also verify and cross-check data. This potentially eliminates duplicate or erroneous supplier payments that eat into profit margins and necessitate re-work.
Digital platforms use artificial intelligence in accounts payable, along with machine learning and other advanced technologies, to automate expensive, labor-intensive tasks, including:
- Assigning general ledger codes
- Validating information on invoices
- Routing invoices for approval
- Determining whether a document requires exceptions handling
- Posting approved invoices directly into an ERP system
- Reviewing approved invoices for errors and duplicate payments
Additionally, digital platforms incorporating AI and ML automatically match invoices to purchase orders and proof-of-delivery documents. They can detect gaps and their possible cause and alert the appropriate operator of those gaps. Then, suggest the individual who should be notified based on past correction histories.
And digital platforms can identify duplicate invoices or flag suspicious transactions that can lead to financial losses. When performed by a human, this type of analysis is typically based on experience and intuition. AI, ML, and other digital technologies can be used to build a statistical model based on historical data to identify patterns that may be missed by a human.
Digital platforms that use artificial intelligence in accounts payable perform many of these tasks within seconds, freeing staff to focus on value-added activities.
AI in AP Solutions Improves Visibility and Growth
AI has received a lot of attention for its ability to automate routine tasks such as invoice data capture and workflow routing. But it offers greater value in accounts payable than transaction processing.
Dashboards with AI in an advanced AP automation solution give accounts payable staff and other stakeholders real-time visibility. Stakeholders can monitor staff productivity, invoice status, the source of exceptions and accruals, and liabilities. They can examine late-payment penalties, early-payment discount capture opportunities, corporate spending, and other metrics from any PC, laptop, or mobile device.
Business intelligence tools in AP automation solutions analyze current data and historical trends and patterns for more dynamic decision-making. They also can uncover bottlenecks and the root cause of exceptions.
AP automation solutions with AI and ML also make forecasting fast and accurate. Accounts payable software can scan and analyze unlimited amounts of data from any source to forecast cash, spending, and other key data based on historical patterns and trends. The insights an AP automation platform gleans from historical data, such as recurring invoices, helps businesses determine when it is best to release cash or to take advantage of early-payment discounts.
AP automation solutions with AI and ML also make proactively managing compliance and fraud risks easier. Data sets across multiple systems can be analyzed to identify patterns that may indicate compliance violations or fraud based on corporate guidelines, past operational records, and auditor guidelines. Flagged transactions are electronically routed to the appropriate individual for review.
Decision-makers can use the insights provided by accounts payable information to better manage their cash, spending, fraud, and compliance risks, supplier relationships, and financial operations utilizing artificial intelligence (AI) in accounts payable.
__________________________________________________________________________________________________
Edenred Pay, an Edenred Company, is the global leader in invoice-to-pay automation. Our integrated platform connects businesses with suppliers, ERPs, banks, FinTechs, and payment rails to automate, optimize, and monetize the entire B2B payments lifecycle – from invoice receipt through payment reconciliation. Edenred Pay’s efficient, integrated solutions create a frictionless process and help deliver value to the enterprise by enhancing visibility and monetizing AP.
Visit www.edenredpay.com or contact us to learn more.
