The first quarter of a new year, from January 1 to March 31, is widely considered the busiest time for accounting teams. Between closing year-end financials, maintaining compliance, and preparing for tax season, it is essential for processes to continue running smoothly during this chaotic time.
Automation can help solve many problems facing accounting teams, particularly during busy first quarters. Here, we will cover a few of these issues and how automation can assist.
Staffing Shortages
The 2024 Finance & Accounting Talent Market Outlook reported that 83% of senior leaders faced talent shortages in the accounting departments. Given recent economic uncertainty, businesses cannot bring in extra staff and resources to help tackle the busy season, leaving existing staff working longer hours to accommodate the larger workload.
According to Careerbuilder.com, the average cost to recruit, hire, and train a new employee with a $60,000 annual salary can cost a business between $30,000 to $45,000. That is why it is imperative to maintain your current staff and keep them happy.
Automating vendor payments removes much of the manual effort that can bog down AP staff. Integrating automation capabilities into an existing accounting management software makes their lives even easier and reduces the time spent manually keying payments and payment data.
Late Payments
Paying vendors on time ensures consistent business fluidity. When payments are late, vendors assess late fees averaging 1%-2% of the past due amount. More importantly, you risk damaging the relationships that you rely on.
A good automation solution will support payment reminders and simplified payment processes to keep payments on time and vendors happy.
Complex Reconciliation
Especially important during the busy season, being able to easily reconcile across all accounts, vendors, and transactions is key to controlling the chaos.
Consolidated reporting prevents platform jumping and the manual errors often associated with manual data entry. Additionally, realtime data updates ensure the payment status and transaction data are the most current.
Vendor Payment Enrollment and Management
How many vendors do you pay on a weekly basis? No matter the number, vendor payment automation platforms can alleviate the stress of enrolling vendors and managing their payment data. File uploads, dedicated teams and webhooks simplify how vendors can get set up to receive payment.
Security
While payment automation platforms can still support paper check payments for those vendors who need it, they are consistently targets of fraud. Many warnings have been issued about mailing checks, and it is recommended all vendors accept payments via more secure digital methods.
Virtual cards and ACH are popular payment methods that enhance payment security and enable vendors to be paid faster. Encryption, tokenization, positive pay, ACH validation and payment vaults further protect every payment.
Equipping Your AP Team
Automation is the best tool to arm your AP teams ahead of their busiest time of the year. REPAY’s vendor payment automation platform integrates seamlessly within your preferred accounting system to support them without adding new resources.
- Simplify & secure outbound payments
- Increase efficiencies without increasing headcount
- Maintain current staff
- Reduce costs
Implementing our automation tools is seamless and doesn't require additional resources. Contact us to get started!