How AP Automation Improves Cash Flow
AP automation improves cash flow by providing visibility into cash flow and spending, accelerating invoice processing, and improving collaboration.
AP automation improves cash flow by providing visibility into cash flow and spending, accelerating invoice processing, and improving collaboration.
Cash flow is a hot topic for accounts payable and accounts receivable departments alike.
On the accounts payable side, extending Day’s Payable Outstanding (DPO) – the measure of the average amount of time it takes a business to pay its suppliers – is a top priority.
On the accounts receivable side, reducing Day’s Sales Outstanding (DSO) – the measure of the average amount of time it takes for businesses to collect receivables – is a top priority.
And accounts payable sits in the eye of the storm.
In most businesses, the accounts payable function is responsible for payment timing, per the Institute of Finance and Management (IOFM). Accounts payables is the last line of defense against cash flow issues.
In order to effectively manage the business’ cash, accounts payable must:
- Provide real-time visibility into critical financial metrics such as liabilities
- Collaborate with suppliers and internal stakeholders to manage spend
- Make timely and accurate payments to suppliers to avoid supply chain issues
Automated AP software can improve cash flow
Effectively managing cash flow sounds like a tall order.
But automating accounts payable with invoice processing software makes it easier.
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Control funds and corporate spend in real-time:
AP automation solutions help buyers manage their cash better with intuitive real-time graphical dashboards into invoice processing. AP automation software provides instant visibility into invoice status and payment history. In addition, real-time reporting enables buyers to forecast outbound cash flows with greater accuracy. AP automation solutions also eliminate information gaps that lead to cash management issues by aggregating all paper and electronic invoices onto a single platform and integrating seamlessly with the buyer’s ERP, whether it is from SAP, Oracle, PeopleSoft, NetSuite, Sage or another vendor.
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Collaborate with suppliers and internal stakeholders:
AP automation solutions that include an online supplier portal help transform the accounts payable department into a profit center. Dynamic discounting, early payment discounts and supply chain finance satisfies supplier demands for earlier payment, while buyers benefit from discounts on the amount due on invoices and/or revenue share from third-party financing companies. All of this is facilitated by faster approval of invoices and the ability to collaborate with suppliers via an online portal.
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Fast, easy supplier payments:
Invoice processing solutions enable buyers to securely pay suppliers via ACH or card using a single file. Accounts payable staff simply upload an approved invoice file generated by the AP automation solution and schedule individual and batch invoices for payment. The invoice processing software aggregates data on approved invoices from any office or subsidiary. Additionally, rich remittance details are automatically transmitted to suppliers.
Managing cash flow can seem like a balancing act for accounts payable leaders.
But an automated invoice processing system helps keep accounts payable departments from falling.
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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.
