Sending invoice, tracing the customers, contacting, negotiation and following-up and receiving and recording payments, updating and reconciling the accounts is a tedious and time-consuming process which can significantly eat-up valuable time of the employees. And all these problems amplify as the business grows to make it even difficult for an entity to efficiently manage the AR process which a pillar for cash-flow and working capital.

Cash is king when it comes to business and AR is the source of the cash flow. And a manual AR process can cause costly payment delays, costly manual errors and put hindrances in efficiently utilizing your resource to improve the cash flow. And this exactly when business entities around the world are embracing automated Account Receivable systems.

Are you a small and medium business owner looking to automate your AR system as well? Then this blog is for you. Here are the 6 reasons why businesses are adopting automated Accounts Receivable Services today:

Streamlined invoice processing & verification:

When it comes to manual AR, the invoice processing involves pulling the information from the system, entering it manually and sending it to the concerned party through e-mail. The customer then reviews the invoice approves it and sends the payment; the entire process is manual and tedious, a perfect situation for mistakes to happen be it with data entry, delayed payment or any other common mistakes.

From the creation of the invoices to verification and record of the payments from customers, automated Accounts Receivable Process streamlines the entire process, avoids the errors, and makes communication simple and payment process easy. As the payment is done, the automated system also identifies the type of documents, extracts the data, verifies it and reconciles it, making payment identification and verification a breeze, saving time and resources for the AR team.

Simplified cash in-flow & Centralized documentation:

 With electronic payments and automated AR system, your team doesn’t have to wait until the manual check arrives and deposit in the bank to cash it, payments are automated helping you get paid faster improving your cash in-flow. Automated AR systems accelerate the payment process, gets you paid faster, verifies and reconciles it and most importantly centralizes all documentation of these specific steps on one simple platform for everyone access. This helps in streamlining communication and easy access to information to management on short notice, and paves the way for taking quick and strategic management decisions.

Reduced AR Days Sales Outstanding & Improved Cash Position:

Continued efforts are being made for years to reduce the AR Days Sales Outstanding which is the number of days it takes for a business to collect the dollars they are owed. Higher the number more the business experiences cash flow problems. With prompt billing and fast invoicing every step in the AR process is accelerated resulting in a reduced Days Sales Outstanding and an optimized cash flow.

Complete End-to-End Receivables Management:

An automated AR system offers a completely automated process that is visible at every step and has better control over the process from one end to other. This end-to-end visibility and control make it easy for the accounts team to pull the specific data, keep tabs on every step, resolve the dispute and analyse the financial performance making high-level financial decision making easy and pro-active.

Better Customer Relationships:

While manual AR process eats away so much time in identifying and pinpointing the cause of customer dispute to solve it effectively, automated AR system is equipped to solve these disputes at an accelerated pace. Having end-to-end visibility and control not only increases the efficiency in resolving the customer issues but also decreases the time spent on such disputes making the entire experience, a positive one. Given the automated AR, systems accelerate the payment processing you team is left with more time to adequately provide pro-active support for the customers and build better relationships with them.

What makes all the benefits of the automated AR system more appealing is that the entire process can be completely scaled up or down based on your business requirements removing the necessity to hire more resources. It lightens the burden on your team and gives them more time to focus on their core capabilities improving the overall productivity of the company in the process. And more importantly, automating the Accounts Receivable is the first step towards leveraging the power of remote accounting services which the world is increasing move towards in coming years.

If you are a small and medium business owner looking to leverage the benefits of the automated AR system, our expert accountants at Back Office Accountants are ready to help you with our Accounts Receivable Services. You can contact us here: