Outsourcing companies may not always be transparent in how they deal with your AP processes. Also, changes in your processes may not be fully implemented by outsourcing companies handling your AP processes, resulting in more errors or rework. Accounts payable outsource companies are equipped with the necessary skills, tools, and technology to integrate with an organization’s existing AP processes. When choosing to outsource AP, a company will need to hand over their historical data as well as any in-house documents, which some might find concerning.
When considering outsourcing, answer the following questions to get a better idea of your needs and what’s possible. Asking for references and case studies can also provide valuable insights into the provider’s track record and effectiveness in managing accounts payable processes for other organizations. Selecting the right accounts payable service provider is critical to ensure a successful partnership. Below are our top tips for three areas to consider when choosing the best AP outsourcing provider.
Mid-sized businesses don’t often have the luxury of employing a robust team of security experts, nor do they have the resources to run extensive audits and eliminate risks. To get the security tools and skills they need, many small to medium-sized businesses rely on the outsourcing services of larger and more sophisticated AP experts. Instead of having an in-house accountant for whom you have to provide full hours and benefits, you can hire someone on the outside to do your financial processes and record-keeping for you. There are plenty of myths circulating around accounts payable outsourcing, but read on and you will find that the benefits far outweigh the risks. Another importance is finding partners that have worked with businesses of a similar size in the past.
Should you outsource accounts payable?
Outsourced AP experts will also have an understanding of compliance regulations that must be followed during invoice processing, making sure all documents adhere to current standards, policies, and regulatory rules. A SOC 2 Type 2 report is an internal control report capturing how a company safeguards customer data and how well those controls are operating. These reports are issued by independent third-party auditors covering the principles of Security, Availability, Confidentiality, and Privacy. Usually, such third parties use internal servers and cloud storage to store sensitive data. While it serves as centralized access for both parties involved, the data is also prone to potential security breaches and hacks.
- With the right provider, companies can streamline their business operations, refine their processes and grow revenue.
- But with so many possible paths, many finance leaders struggle to understand how to successfully migrate the AP function.
- The list of services varies but the vendor will generally perform functions such as invoice capture, purchase order (PO) matching, and processing, payments, archiving records, and reporting.
- The ARDEM Invoice Manager platform is configured to provide Data output files via API transfers, Dashboards to view Spend Data and Reports with actionable data that can be used for Analysis.
- Finally, AP outsourcing provides companies with access to advanced technology solutions that would normally be too expensive for them to develop or maintain on their own.
However, this can bring information irregularities and an absence of permeability into the records payable interaction, which can be a critical weakness. The loss of process control is one of the significant drawbacks of outsourcing accounts payable. When organizations outsource, they should give control of the cycle to an outside specialist co-op, which can prompt a deficiency of command over the records payable interaction.
Our focus on invoice mapping and reconciliation has helped our clients clear unpaid bills within deadlines and avoid getting penalized. In the process, we have successfully kept all our clients’ stakeholders happy and assisted them to focus on all their mission-critical issues. As a specialized accounts payable outsourcing services company, we have been successfully delivering sales invoice customized accounts payable services that are suited to the specific needs of each business. We have assisted many organizations across the globe to simplify their accounts payable workflow, limit access and establish superior control, and prioritize invoicing processes. These have honed our skills to a level where we can meet your needs with full competency.
The Invensis Advantage for outsourced AP Services
Automation offers many benefits of outsourcing accounts payable without the liabilities of engaging a third-party team. Accounts Payable outsourcing services can provide the relief your accounting department needs. The benefits are clear — lower costs, updated processes, and fewer errors, just to name a few. Outsourcing can solve some of the issues that come with the rapid growth of your business.
Cost Per Invoice CalculatorCost of Invoice Processing
Make sure you understand how the transition will occur, how you will know it’s completed, and how the outsourcer measures success. If you’re outsourcing accounts payable data, you need to share your confidential financial data with the third-party provider. Companies that don’t use e-invoices and other electronic automation tools are likely to lose out to more productive competitors! Additionally, upgrading those old accounting systems to modern solutions such as Quickbooks can be costly and time-consuming. An increasing number of businesses are outsourcing their accounts payable processes to a specialized third-party team.
Should You Outsource or Automate Your AP?
This can range from invoice receipt and processing to vendor management and payment processing. Many vendors from across the globe offer Accounts Payable services, and businesses that utilize them can save time and money and take loads of stress off their employees. Outsourcing your financial department means handing over sensitive data to a third party. You would be outsourcing accounts payable, payroll, tax filing and management, financial reports, vendor invoices, and payments. Along with that comes your payment information and other sensitive financial data.
Accounts receivable and accounts payable
It’s especially a hassle if you’re a small business or don’t have an accounting department or designated employee. How can you be guaranteed to fit accounts payable and other tasks into your busy schedule? Let’s define what we’re talking about, accounts payable is the term used to describe what results from buying goods or services from suppliers on credit. Gartner reports that 89% of accounting operations will be automatable, and approximately 75% of CEOs plan to use automation to address major issues. However, implementing AP automation isn’t as simple as it appears, and most businesses struggle to realize expected gains without the assistance of knowledgeable staff. Benchmarking your Accounts Payable department against its peers can assist you in finding the most profitable outsourcing possibilities.
Outsourcing your accounting and financial admin can unload some of that burden. But with the right automation solution, switching to automation isn’t a headache at all. Each advantage on that list is actually a benefit of automation, not outsourcing in and of itself. Download Invensis’ Finance & Accounting services case study on Automobile Mortgage Loan Processing to find out how Invensis delivered positive outcomes.
Each of these companies offers a unique set of services and solutions to help streamline your accounts payable processes and improve overall efficiency. AP automation streamlines invoice processing workflows, from invoice receipt to approval routing, to PO and receipt matching to the invoice, to review and exception management, to final approval for payment. In a nutshell, it simplifies each invoice so that they’re readily available, tracked, and paid on time. When automating accounts payable, a company will rely on a third-party software to automate the process, but the business keeps all AP processes in-house and requires staff training within the AP department. With the technology offered by an accounts payable outsourcing provider, businesses can seize the opportunity to eliminate paper-based processes and significantly reduce manual tasks, such as data entry.