Accounts Payables

Top 5 Essential Account Payable Trends to Focus on in 2019

Posted on 29/05/2019

It is rather an accepted norm to view Accounts Payable as a traditional mandate. However, each passing year we witness fleeting trends that influence and impact the outcomes of Accounts Payable. As we stand midway across 2019, now is as good a time as any to assess and analyse the strategies and trends that have made a difference this year. With trends and tactics evolving every day, it is highly critical to stay abreast and lead from the front to make a difference.

The forecast of 2019 looks very promising with the substantial impetus provided by today’s technology. However, leveraging these offerings and transforming them into tangible results is what would make all the difference at the end of the day.

Here are the top 5 essential  Account Payable trends to look out for in 2019:

1.Accounts Payable Automation

The crux of the efficiency of Accounts Payable stems from the competence of the invoice routing and data entry. A lot depends on the precision with which these tasks are undertaken. It has also been discovered, in a recent study that the two biggest challenges within Accounts Payable were the manual data entry and the manual dependencies of invoice approval.

In an attempt to increase efficiency, organizations are now transitioning towards automation. Automation would simplify the entire process and eliminate any room for human errors. Automation takes the top spot in terms of the Accounts Payable trends to watch out for in 2019.

Some of the outcomes of automation that can positively impact the business are:

  • Swifter invoice approval rates
  • Reduced processing costs
  • Heightened visibility across the entire AP process
  • Enhanced productivity

2.Using Big Data as Spearhead

How much data does your organization have lying around without being tapped into? It is highly probable that you have enormous amounts of data that you barely feel the need for. The data if appropriately used by the Account Payable teams could be a total game changer. The data can be leveraged to completely transform the process of Accounts Payable in your organization. Big Data is no longer just a buzzword. To stay on top and keep up with evolving trends, it would be quintessential to make good use of the data that you have at your disposal.

An analytical study into the dynamics of the approval of an invoice along with the time taken can help shed greater insights into the overall process. Spend analysis reports can help assess the financial well-being of the organization. This in turn can instate transparency and help improve the cash management.

3.The all-silver Cloud

Every dark cloud has a silver lining, doesn’t it? Now imagine an all silvery cloud… Looking good eh?

Well, studies show that over 58% of large companies use cloud computing. Generally, when a new technology debuts, it brings along varying degrees of cynicism and apprehension. But today, cloud has become the norm. Operating on a subscription-based service model, cloud is also highly cost effective. Records also show that companies that migrated to cloud have shown a growth in revenue by 15%.

The accessibility that comes with cloud can be a real key differentiator. Managers being able to remotely access, review and approve invoices can drastically bring down that time involved. Also, unlike AP software that may periodically require updates, at times even leaving the software temporarily obsolete. Cloud computing also ensures high level of data security.

4.Fraud Prevention

A report tells that about 86% of organizations have had at least one incident of fraud in the past two years. The report also goes on to state that, all the companies, regardless of the incidents hold fort and strengthen their security features consistently. Organizations don’t generally roll back to an older state threatened by these attacks.

The rise of modern computing technologies has almost always been parallelly accompanied by growing threats and vulnerabilities. As 2019 promises to be a big year for Accounts Payable, it is also going to be clouded with the evolving security challenges. These threats, when circumvented can pave way to swifter and more reliable monetizing avenues.

One of the easiest ways to reduce fraud is migrating completely to digital transactions and getting rid of paper checks. It has also been studied that digital transactions are capable of reducing fraud by at least 10 times as opposed to conventional methods. Investing in a fully automated procure-to-pay solution should help voraciously combat fraud.

This could be the year that Accounts Payable finally sheds its cost centric stature to unveil a more profit centric stature.

5.Evolving Skill set in Accounts Payable

The transition from a technology to another is not as straightforward as it sounds. It doesn’t just take effect after installation of the requisite hardware and software. It involves a lot more than just setting up the system. The demand for new skill sets will necessitate employee training and skill upscaling. From a more manual skill set of data entry the demand would shift over to more cerebral skillsets like data interpretation and business analysis.

It is also likely that skills like change management, software administration, performance analytics would be prerequisite on the resume’ of an accounts payable manager.

 

Why Velan?

With a legacy of proven proficiency spanning across a decade, Velan is equipped with a veritable pool of talents and skill sets that cater to the evolving needs of today’s technology driven world.

Talk to our Experts today [CTA] and give your business the smooth sailing it deserves!!!

 

Citation 1 :  Accounts Payable : https://www.levvel.io/resources/report/pitching-roi-for-accounts-payable-automation

Citation 2: Cloud : https://www.mediusflow.com/en/untapped/articles/innovation/ap-solutions-in-cloud-vs-on-premise

Citation 3: Fraud Prevention : https://strategictreasurer.com/2017-treasury-fraud-controls

Topics: Accounting , Accounts Payables


Why is Monthly Cleanup of Books & accounts Important?

Posted on 02/05/2018

Have you ever wondered why your bookkeeping system is in shambles? We do realize how an organized, clean, well maintained books of accounts depict the health of the business. This scenario arises when a lukewarm attempt is made to DIY bookkeeping, lack of time, incompetent bookkeeper or just failing to get it done.

A sensible way is to start your bookkeeping in the correct way from the beginning. Maintaining the books and balance sheets regularly, or rather at the end of every month will generate squeaky clean books. Considering the fact that you haven’t been updating on a monthly schedule, you need to start all over. Installing QuickBooks or any other bookkeeping software of your choice will be the first step.

For your benefit, here is a run through of bookkeeping tasks to close the books every month. This monthly routine helps you maintain cleaner books, easier business decision making and get tax-ready for the end of the financial year.

Cleanup of Books & accounts Important

Accounts Receivable

Your monthly invoices for work done for clients have to be scrutinized and all the deposits and cash are posted to QuickBooks should be checked. Try to reconcile your accounts receivable report, making adjustments against General Ledger and Balance Sheet.

Accounts Payable

Make sure monthly recurring bills and payments such as, car insurance and loan payments are entered in the respective books of accounts. Outstanding vendor bills and statements must be in line with Accounts Payable accounts and the Balance Sheet. The final monthly checkup of accounts should match your vendors’ records.

Monthly Reconciliation statements

Bank reconciliation statements for your multiple bank accounts, credit card transactions for the month should be updated, printed and filed for future reference. Reconciling loan balances and credit against the monthly statement should also be filed as it would make bookkeeping at the end of the financial year easier to handle.

Prepaid Income and expenses

Check for appropriate journal entries posted for prepaid income and expense adjustments, this would make your bookkeeper’s job a lot less time consuming.

Write off Bad debts

Bad debts that are uncollected are to be written off. QuickBooks has the facility to write off bad debts using the Credit Memo.

Keep an eye on your fixed assets

Any changes in your Fixed assets including depreciation must be updated on a monthly basis.

Validate all checks and Invoice numbers

Check books and invoice statements are generated in numerical order. Watch out for any missing numbers on checks or missing transactions and bring it to records. Any void or cancelled checks are listed and kept on record.

Review Financial statements

Check all postings in the financial statements for errors, missing records and unusual balances. When you identify any untoward transactions, review them and make necessary adjustments. Printing and filing Financial statements and reports are required for perfect cleanup.

Close Books and Backup

The Closing Date feature in QuickBooks permits you to lock the previous months and is password protected as well. When all the adjustments for the month is completed, the bookkeeper closes the books for the month and a backup of the books are done.

Keep tabs on your Budget

Reassess your actual numbers against budgeted numbers. You will understand why there is a difference and how a workable budget can be reinforced and managed for the following month.

The above measures are not only helpful to clean up your books of accounts, but also gives you the confidence of running a healthy business. As we are drawing close to the end of the financial year, well maintained accounts are an advantage for preparation of taxes. One of our services in demand is the cleanup of books for small, medium and large businesses. So, if you are looking for a shipshape financial book of accounts on a monthly basis or at the year end; an added bonus  is your peace of mind. Do contact us for a consultation.

Topics: Accounting , Accounting firms , Accounts Payables , Accounts Receivables , Bookkeeping Services


Improve Accounts Payable Efficiency: 15 Best Practices

Posted on 30/06/2017

Every organization witnesses a skills gap; 75% CEOs feel their in-house team isn’t adept enough to keep up.Keeping that in mind, it is always helpful to define clear, precise and well-defined workflows and practices in every business process. Here are some tips and best practices to Improve Accounts Payable efficieny. A better Procure to Pay process will not only benefit your working capital, cash flow, and vendor relationships but go the extra mile help you to identify areas of savings and compliance. If you’re looking to strengthen your bottom line performance, what better way than to improve liquidity?

Services for Accounts Payable

So read on, as we enlist 15 best practices to improve accounts payable efficiency (in no particular order), keeping in mind the organizations where the AP function primarily relies on paperwork submissions. We know some companies have already adopted EDI and we’re going to keep this as generic as possible.

  1. Defined Roles and Responsibilities: Assign access rights, or assign specific employees the capacity to add/delete/modify vendors in the vendor master files. Especially in systems that lack the ability to print changes made to the files, this practice can be pivotal in avoiding theft.
  2. Use default settings to your advantage: It is recommended that you default the AP master file configuration to a Vendor Type used most frequently. If your system allows for multiple vendor categories, set access rights in a way that users only above a certain security level are allowed to change the GL code.
  3. Avoid batch entries: Entering each invoice individually, allows for a separate audit trail and that would greatly help in keeping track.
  4. Check the Invoice Dates: Do not let your AP clerks use older invoice dates. Try and understand how your system assigns GL month/year as well. When you generate reports on financial reports for a time period, correct dates will alleviate unexpected results.
  5. Review and reconcile: Compare charges to purchase orders while paying out and perform a monthly reconciliation.
  6. Automation is better: Manual processes such as expense reporting, data entry should be automated for better utilization of your accounting resources. This will also minimize risks and errors.
  7. Try an ERP system: Most of the auditor’s time is consumed in reviewing manual postings owing to an elevated risk factor. This can be eased with the help of an ERP system.
  8. Always compare with original: It is advisable to try and pay against the original invoice but if paying from a copy, compare the invoice number and charges indicated.
  9. Verify W-9: In the year’s end when you organize 1099s, you don’t want to be stuck in a rut. Before initiating payment, verify the vendor has a W-9 file for them.
  10. Invoice number rules: If all your clerks starting entering invoice numbers in the format they please, you’ll be lost for eons; especially if you don’t have an invoice number in hand. Instead, have a policy and educate your clerks on how to enter invoice numbers.
  11. Accountability: Assign and authorize separate people for entering the invoice, approving the invoice and signing the check.
  12. Logging is key: All invoices should compulsorily be addressed to the Accounts Department – this way they can be logged.
  13. Define Budget: It is safer to know your AP team know what the declared budget is, if you are among those who run a lot of cash transactions.
  14. Audit trail is imperative: Even if you don’t plan on paying the entire invoice amount, it would help the audit trail to mark it as billed. At these instances, use credit memos.
  15. Free is good: Discounts and free goods being offered by your vendors is something that could greatly help your accounts. Watch out for these festive promotions and make the best use of them.

Go the extra mile with these best practices, and watch your AP process go above and beyond maintaining operating margins. Velan is a trusted and seasoned Accounts Payable services providers. Velan AP process takes extra care on available free credits, payable days, purchase order mandates, and Accounts Payable cycle efficiency. Accurate Accounts Payable reconciliation plays a vital role in clearing unpaid bills within the stipulated time. Outsourcing your Accounts Payable management to Velan will help you effectively mitigate fines for late bill payments and ensure that you have a streamlined Accounts Payable process flow leading to optimized of profit for your business. Call @ +1-860-215-4997 to know more.

Topics: Accounting , Accounting firms , Accounts Payables , Financial Reporting , Outsourcing Accounting


7 Questions You Must Ask Before Purchasing Accounting Software

Posted on 02/03/2017

Accounting software these days is considered as a must-have to meet the requirements of small business mainly. Plus, it also acts as a vital tool facilitating your decision making process since you get regular updates of your finances and there are tools to analyze your budget. Not only do they provide you with all the details you require but also most importantly, they provide the same on-the-go. But the question is in a sea of accounting software available online, how you can choose the right accounting software suitable for your business.

Accounting firms - Velan

Below are some of the questions you must ask the service provider before signing up for the product.

1. Can the software meet all your requirements?

First of all, you must be clear and precise in what you want in your accounting software; second of all, you must know what you don’t want your software to do. This self-understanding will put you on the right perspective in deciding your vendor.

To understand your requirements better you can start asking questions like:

  • What are the features that I need? For example, payroll processing, bookkeeping, invoicing, customer information, inventory, etc.
  • Is the software scalable based on your requirements?
  • What would work for you? Cloud based online setup or local?
  • Is this software compatible with your computer and other software in use?

2. What is the potential of the software for ROI?

Once you have fixed the functionalities you require, the next thing you should do is think about the pricing of the product. You would like to have accounting software only reduce some of your operational costs and not hinder them. Plus, you should also ensure that you don’t spend much on this so-called solution for your problem. One main thing you should understand besides your requirements is what is the most you can spend on this software.

Bear in mind, you are looking for functionality and not how slick this application is. The application must be two things

  • Serve the purpose and cost and
  • User-friendly

3. What do the reviews say about this software?

Today, the rate at which information reaches many people is very high. Thanks to the technological advances. Online forums and social media play a vital role in delivering information to the needy people. Online forums do talk about products and their reviews. These forms are straightforward and it is where the credibility of the product or software lies. It is imperative to know what these customer reviews and other third party websites tell about the software you are planning to purchase.

There are third parties who would examine the product and give an unbiased review.

4. How does their customer support work?

Technological failure is unavoidable. But what if this failure, for instance – account inaccessibility, or a software malfunction occurs at an inopportune moment? What you can do is, find out the customer support services they provide. Some of the things you may consider knowing are:

  • Support included: you need to inquire what kind of services are covered. Some companies charge you for providing one-on-one support or for providing 24/7 support.
  • Expertise: a problem can be identified by experts who have comprehensive knowledge in the field. How quickly they resolve becomes imperative when you are dealing with a customer on live.
  • Forums: do they maintain any forums where any frequently occurring problems are discussed by other users. This will give you some knowledge on resolving the issues without the help of the support team.

5. Is the software customizable to cater your needs?

Before purchasing software, you must ensure if they provide customizable solutions. We all know, requirements keep changing and if you do need some customizations, you cannot pay more than one-third of the total price of the software. Negotiations are inevitable. Make sure that both the parties are benefiting out of the deal. Sometimes it is good to talk to the top managers rather than go through gate keepers who will drag their feet most of the times.

6. How secure is your data?

Most software is available online. Though the online availability of all your records may sound fancy, remember it comes with a price. The major price you would have to pay for this convenience is compromising your data security. Even a minor breach in data can cause a major threat to the small business owners. This may come in terms of theft of credit card details and customer details, and other vital information.

One way to be alert is to read the customer review about the software’s security, find out if there are any complaints on data breach, and finally check the company security policies to know if there are any vulnerabilities.

7. Is migration of your data and customer’s data possible?

Anybody can have the necessity to upgrade their older computer or for some reason change their system. The last thing you would want to deal with is the unavailability of data migration option. Truly, it is time-consuming to enter all the data all over again. Hence, data migration is one of the important aspects you will have to make sure that it is available in the software you would like to purchase. Plus, there are vendors who can lend you a hand with migration. This will come in handy when you don’t have time for data migration.

It is imperative to look for vendors who provide you all the above said things and at competitive prices.

Call @ +1-860-215-4997 to know more about the best fit for your business and also to handle your accounting needs.

Topics: Accounting , Accounts Payables


Top 5 Practices For Account Reconciliation

Posted on 13/02/2017

Account Reconciliation is very important for CPAs and accounting firms. If they are not handled effectively, they can be time consuming and exhaustive.  Below are some of the practices for you to handle account reconciliation in a whole new perspective:

Account Reconciliation

1. Prioritizing the Balance Sheet

Strategically planning your priority is the key approach. This method is also called “risk based prioritizing.” You need to identify the accounts that have high chances of becoming erroneous essentially. This can be done by ranking the risks as high, medium, and low. Ensure that risks that are ranked high should be given more importance. You can also set times for each category. For example, you can set time frames like monthly, bimonthly, quarterly, etc to process the accounts. You need to thoroughly analyze the accounts both qualitatively and quantitatively to categorize each account.

2. Standardization

You need to identify one “Best Practice” and ensure that you communicate the same to all the departments of the organization and everyone follows it as told. For instance, a company has to standardize the accounts reconciliation process, policies, templates, etc across the whole organization.

3. Monitoring the process

Every member of a team should stay updated with the process going on. This may not work as desired if the team does not have a leader. When we talk about leading a team, it doesn’t mean that this leader should be from management; any person at a lower grade who has the flair to run the show will work. All he has to do is ensure that all the team members finish the tasks on time, follow up with late or unfinished reconciliations.

4. Utilizing technology effectively

Technology these days is playing a vital role in the reconciliation process. Use the software from companies like Trintech, Hyperion, and BlackLine. These companies have designed software which has made the accounts reconciliation process much easier. Some important features of the software include automated balance interfaces, automated notifications for the users, real-time dashboards, etc.

5. Improvements driven by metrics

The leadership in monitoring the processes can also take care of the performance enhancement and improvement by utilizing the metrics available. There are certain metrics that should be reviewed at regular intervals like a person’s or department’s completeness, material reconciling items, and overdue reconciliations. This can also help enhance the above mentioned standardization process.

Contact @ +1-860-215-4997 to know more about reconciliation and handle any of your accounting activities.

Topics: Accounting , Accounts Payables , Accounts Receivables , Outsourcing Accounting