Looking for the best automation tools to manage your accounts payable can be challenging. This article talks about the top AP automation software for enterprises, both large and small, to help make handling invoices easier and more efficient.What is an accounts payable software?Accounts payable software is a program that assists companies in organising their invoices and the payments they need to make. It monitors all the invoices from suppliers or service providers and ensures they get paid promptly.This software also saves time by taking over the job of punching in the invoices, verifying them for correctness, and tracking the payments.Think of it as a digital helper that takes care of all the document management and payments so companies can avoid the stress of missing an invoice payment or making mistakes in how much they pay.What is accounts payable automation?Accounts payable automation means using technology to make the process of dealing with a business's invoices and payments to suppliers easier and better. Instead of doing things by hand like sorting out invoices, typing in information, checking details, and giving approval for payments, this technology does all that work.It processes invoices on its own, matches them with orders, gives the approval for payments, and can even handle the payments through electronic means. This speeds up the process, reduces errors, saves money that you would otherwise spend on employees to do these jobs, and helps control cash flow better. It's like having a smart system that ensures your invoices are correctly and timely paid, without needing your constant supervision.What are the benefits of AP automation? AP automation helps businesses in several ways:Makes things more accurate:: When people enter data by hand, mistakes and mix-ups can happen, leading to wrong numbers in the books.

When dealing with a large number of invoices, managing them and keeping a record of the invoice information manually becomes a complex task for the Accounts Payable team. Invoice extraction methods can really help in dealing with it. But what exactly is invoice information extraction? Let's delve into the essence of this process and understand its significance in the operational workflow of enterprises.What is invoice information extraction?Invoice extraction refers to a process in which enterprises use software to automatically get key details from invoices, like vendor information, invoice numbers, and totals, from various formats including scanned documents, PDFs, and e-files.The methods include Optical Character Recognition (OCR), machine learning, and intelligent data capture. Why is invoice information extraction important?Invoice extraction is crucial for businesses as it speeds up understanding and using invoice data like payment amounts due. This method saves time and lowers errors versus manual entry, ensuring accurate and timely payments.It's like having a smart helper to efficiently organise and manage all the money matters.What are the different types of invoice information extraction?Majorly there are three main types of invoice information extraction:Optical Character Recognition (OCR)Intelligent Data CaptureMachine LearningIncorporating these technologies into the invoice processing workflow can transform how enterprises manage their accounts payable, significantly improving efficiency, accuracy, and scalability. As each technology offers unique benefits, the choice among them—or a combination thereof—depends on the enterprise's specific needs, existing processes, and future goals.Different types of invoice extractionThe following are the types of invoice extraction:Optical Character Recognition (OCR): OCR reads text from documents, converting them to a digital format that can be modified or searched.

Turning traditional paper invoices into digital ones with Optical Character Recognition (OCR) technology is an advanced but simple method that automates the transformation.To digitize invoices using OCR, follow these three main steps:1. Uploading the Invoice to the OCR SoftwareThe first step is to upload an image or PDF file of the particular invoice to the OCR software.This can be done through a mobile or web application. After the upload, the software performs an initial scan to optimise the image quality.2. Converting the Image into a Text FileAfter the optimisation of the image, comes the next step of converting the invoice image into a text file.This is achieved by analysing the light and dark patterns of the image to identify letters and numbers, transforming the visual data into editable and searchable text.3. Parsing TXT into JSONThe last part of the OCR (Optical Character Recognition) process changes the text file into a structured format like JSON (JavaScript Object Notation).

Our relationship with the vendors has a big role in defining our business efficiency.Vendor compliance checks can help us in maintaining this relationship.In this article, we will discuss vendor compliance and how it can help us improve our business's efficiency and operations.What is vendor compliance?To make sure that the products or services meet the quality, every business sets some standards. The vendors must follow these standards for delivering their products or services. This is vendor compliance, as it’s referred to globally.In India, vendors must also follow GST tax rules. This involves timely reporting of invoices in GSTR-1 or through the Invoice Furnishing Facility (IFF), crucial for the smooth functioning of the Input Tax Credit (ITC) mechanism.Following these rules makes business transactions clear and responsible. Including GST rules with other quality checks helps businesses work smoothly and follow the law, making a better market for everyone in India.Need for vendor complianceSeveral key factors highlight the importance of ensuring vendors meet certain standards:Avoiding Operational Issues: Vendor compliance helps ensure that the materials enterprises buy are of good quality.

A successful business is all about money management and how various enterprise teams improve the cash flow.One of the important parameters for improving the cash management of a business is DSO!Let’s discuss some essential things that you need to know about DSO.What is Days Sales Outstanding (DSO)? Imagine selling a product today and letting the buyer pay later. DSO measures how many days it takes, on average, for you to actually receive that money. DSO is a parameter that tells you about the average time that will take for your company to receive payment following a credit sale.How to Calculate DSO?You might have started getting eager about it. “How can I calculate my company’s DSO?”. To figure this out, we need to know some things beforehand.The total amount of money customers owe youThen, look at the value of goods sold on credit over a period, say, a month.The number of days in the period.Formula of DSO:The formula for DSO is as follows-DSO = (Accounts Receivable / Total Credit Sales) × Number of Days in the PeriodWhere,Total Accounts Receivable is the amount of money that the customers owe.Total Credit Sales is basically the net revenue.Example of Days Sales Outstanding CalculationLet’s try to understand them with the help of an example.Imagine an enterprise selling furniture. At the end of June, customers owe the enterprise a total of Rs.5,000 for the furniture they bought on credit. So, this Rs.5,000 is their total accounts receivable.Throughout June, the enterprise’s total credit sales were Rs.20,000. Now, let's calculate DSO for June, which has 30 days:We know that, DSO = (Accounts Receivable / Credit Sales) × Days in PeriodSo, by using the formula: DSO = ( 5000 / 20000) × 30 = 7.5 daysThis means, on average, the enterprise is getting paid in 7.5 days after making a sale on credit in June.High DSO vs.

You got a whiff of culinary pride – India, the world's third-largest producer of cooking oil! But before you could do a victory dance in the grocery aisle, Mrs. Kamini had a reality check waiting for us. She revealed that our country still meets nearly 60% of its consumption requirements through imports! The Accounts Payable team claims it’s been a while since the Indian edible oil companies have been crippled by several supply chain bottlenecks, especially global. Higher freight rates due to the Red Sea crisis add more fuel to the existing problem. It has affected the smooth and timely procurement of raw materials and, in turn, the accounts payable (AP) process.Continue reading the story on how her team suppressed the supply chain challenges through technological interventions and policy revamps.How Supply Chain Bottlenecks & Inefficiencies Became an AP ProblemCompanies that source ingredients globally often face complexities in currency exchange rates, customs regulations, and international trade agreements. Their procurement teams navigate these global trade challenges.

For many small ente­rprises, dealing with financial challenges is a big hurdle. Without enough money to handle une­xpected costs or afford inventory, success can be challenging. A potential solution is a merchant cash advance­. In this article, we'll delve into its advantages and disadvantages, and examine who's e­ligible for such advances.What is a merchant cash advance?Instead of usual busine­ss loans, it's a unique option where you ge­t a single payment. This payment is e­stimated on your future credit or de­bit card sales.

An organisation focuses on two major goals, growth and ge­tting bigger. This can be tough when a company ne­eds stable resource­s or extra money. That's when capital budge­ting steps in. It helps businesse­s prepare for long-term inve­stments. In this piece, we­'ll dive into what capital budgeting is and break down the­ process to make it cleare­r.Meaning of capital budgetingCapital budgeting is like figuring out the best ways to use your business money for long-term gains.

Keeping a close eye on every dollar going out the door is worthwhile in every business. It is even more essential for growing businesses and startups. Losing money to irregular or inefficient spending can make reaching even your quarterly targets challenging.A detailed and informative dive into your spending can shed light on the patterns and trends you might overlook otherwise. Simply, managing your enterprise spending can make all the difference for your business.That is where spend analysis comes in! So, what is spend analysis? And how can it benefit your business? Please read the article to learn all about the importance of spend analysis and its basics.What is Spend Analysis?Spend analysis is the process of gathering data about spending for procurement to reduce expenses, improve supplier relationships, or boost productivity. The analysis reports offer suggestions and recommendations based on facts.

About 70% of organisations expect to increase automation by 2025, as per the recent Gartner’s report. Automating specific manual processes brings about efficiency and delivers cost savings, standardisation, transparency, and other benefits. A proficient finance team anticipates and plans for such scenarios to ensure the company consistently maintains sufficient cash and meets its financial obligations. There are now solutions for such routine tasks thanks to finance process automation.So, what is finance automation? And how to automate finances? Please read the article to learn more.What is Finance Automation?Finance automation refers to automating specific manual tasks along the finance process that can be performed more efficiently with artificial intelligence. It means setting up a series of tasks, called workflows, and making predefined steps to implement and use technology on these workflows. The automation streamlines operations and offers financial insights and analytics for a competitive advantage.Key Areas for Automation in FinanceAs report by McKinsey indicates, a minimum of 42% of all finance activities can be fully automated, and an additional 19% can be mostly automated across various industries.