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What is Accounting Automation Software?

Accounting automation software brings powerful results through streamlined records storage, invoice creation, tax calculations, and more.

What is Accounting Automation?

Accounting automation software is software that automates repetitive but crucial accounting tasks, such as updating financial data, reconciling accounts, managing payroll, sending invoices, preparing taxes, and more. It’s a powerful tool for modern businesses that seek to improve their efficiency and accuracy.

Why Organizations Need Accounting Automation?

Using modern technology to automate workflows is quickly becoming a standard strategy for businesses operating in today’s digital economy. The accounting industry is part of this growing trend, but some accounting departments and firms have yet to embrace accounting automation.

This lack of accounting automation results in hours wasted on manually tracking assets/ expenditures, paying bills, billing clients, managing payroll, facilitating tax payments, and more. Instead of all this, accountants’ time, effort, and energy could be devoted to more creative, higher-value tasks.

With accounting automation software, you can enjoy:

Faster task turnarounds – automate many of the manual tasks that accountants typically perform, such as data entry, invoice processing, and financial reporting. This can free up accountants to focus on more strategic activities, such as analysis and reporting. As a result, accounting tasks can be completed much faster, which can improve efficiency and productivity.
Immediate data retrieval – store financial data in a central location, making it easy to access and retrieve. This can be helpful for making informed decisions about the business, such as budgeting, forecasting, and resource allocation. Additionally, immediate data retrieval can help to improve customer service by providing faster responses to queries about invoices or payments.
Increased data accuracy and security – by reducing the risk of human error. This is because the software is able to follow set rules and procedures when processing data. Additionally, accounting automation software can help to improve data security by encrypting data and restricting access to authorized users.
Increased compliance – comply with financial regulations by ensuring that financial data is accurately and timely processed. This is important for businesses of all sizes, as non-compliance can result in fines or other penalties.
Improved customer service – by providing faster and more accurate processing of invoices and payments. This can help to reduce customer frustration and improve customer loyalty.
Improved decision-making – provide businesses with real-time financial data, which can be used to make better decisions about the business. This data can be used for budgeting, forecasting, resource allocation, and other important business decisions.

Here are some specific examples of how accounting automation can benefit different types of organizations:

Small businesses: Small businesses can benefit from accounting automation by saving time and money on administrative tasks. This can free up time for business owners to focus on growing their businesses.
Medium-sized businesses: Medium-sized businesses can benefit from accounting automation by improving efficiency and accuracy. This can help them to compete more effectively with larger businesses.
Large businesses: Large businesses can benefit from accounting automation by streamlining processes and reducing risk. This can help them to improve profitability and compliance.

Your Accounting Teams and Automation

If your business falls into the “no accounting automation” category, you’re not alone. The McKinsey Global Study also reveals that 13% of respondents had no plans to automate their accounting workflows. But accounting automation offers benefits that may convince them (and you) to reconsider.

Leveraging the power of automation through Acumatica Cloud ERP and its integrated accounting automation software increases your team’s speed and accuracy. It also helps each team member optimize their time management, resulting in lower costs and faster task turnarounds. And implementing industry-specific software gives you valuable peace of mind; you can rest assured that the software provides enterprise-level data security along with greater control over—and accurate visibility into—all your financial and accounting processes.

Types of Accounting Automation

When exploring automated accounting, you’ll discover that it can help you easily:

Track Assets/Expenditures: Automatically tracking and recording assets (e.g., cash, inventory, equipment, etc.) and expenditures (e.g., employee salaries, rent/utilities, insurance, etc.) releases you from manual tasks, such as creating depreciation schedules and generating expense receipts from your credit card transactions, among many other things.

Pay Bills: Monitoring cash flow and outstanding invoice payments, streamlining invoice approval and payment, recognizing prepaid expenses, and accepting vendor prepayments become simplified tasks when you set up automated processes.

Bill Clients: Automated accounting helps you generate invoices, send statements, collect/apply payments, create customer reports without tedious data entry and painstaking calculations.

Manage Payroll: Keeping your payroll accurate and streamlining the process is possible with accounting automation, including automatically pulling time entry data into the system, pay multiple groups and employee types with different pay periods, and more (e.g., automatic payroll attributes, earning type codes, overtime rules, and deductions and benefit capabilities).

Manage Taxes: Automating configuring, collecting, managing, and reporting your taxes with accounting automation ensures that your tax filings are accurate and up to date and that you remain compliant with your domestic and international tax obligations.

Accounts Payable and Accounts Receivable Automation

Two of the most critical accounting processes for any business is accounts payable (AP) and accounts receivable (AR). Among many other tasks, AP team members verify invoices, ensure invoice approvals, and issue payments, and AR team members create and submit customer invoices, process payments, and record transactions.

When AP and AR tasks are managed manually, human errors are common, such as duplicate payments and double-data entry mistakes. These issues are eliminated with accounting automation software and accuracy, efficiency, data visibility, and vendor satisfaction—not to mention simplified compliance tasks—are introduced.

Example of Automated AP Processing with Artificial Intelligence

Automated AP Processing

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"Acumatica has transformed our business, given us access to real-time stock information, and given us the confidence that we can just keep on growing."

Colin Gilhespy, Co-Owner and Managing Director

Cave Direct

4 Benefits of Automation for Accounting

Business owners do not have the luxury of avoiding risk by waiting on the sidelines as change happens all around them. They can no longer afford to have their teams spending hours creating spreadsheets that are obsolete before they can even apply conditional formatting to their perfectly balanced numbers.

These owners need relevant, proactive insights, and they need them now. They need to do more with less, to connect data across systems, geographies, and devices, and they need flexible processes and customizable controls that support their teams in doing their best work—from wherever they happen to be working.

To remain relevant in support of changing organizational priorities, accountants need to constantly seek out new and better ways to provide immediate insights into the numbers they review. They must spend more time listening to leaders and coworkers to better understand the challenges they face. As financial leaders others depend on, accountants are expected to be informed about the modern, sophisticated solutions that can support them in effectively achieving business goals.

Insights depend on the accurate and organized capture of data. While data flows through every department of the organization and each module of the software, it must be structured to deliver meaningful insights while staying in compliance with GAAP and other accounting and regulatory requirements.
Benefits of Accounting Automation

Accounting automation software will bring the following benefits to your team.

Continuous Close

Achieve more, faster. Accounting automation streamlines workflows, eradicates time-consuming, repetitive tasks (e.g., double-data entry), and keeps you from having to reconcile transactions manually. Having cash management, currency management, accounts receivable, accounts payable automation (and more) within a single solution will save your team immeasurable amounts of time—and frustration—and deliver operating speeds beyond anything manual systems could possibly provide.

Enhanced Accuracy

Humans are error prone, and so is clunky, outdated technology. In fact, a , found that, of the over 1,100 C-suite executives and finance professionals surveyed, nearly 70% said their organizations have based significant business decisions on inaccurate financial data, and only 17% said that they could fully trust their finance teams/CFOs to identify all errors and produce accurate reports. As contributing factors to this lack of trust, the respondents cited:

Human error – 41%.
Multiple data sources – 40%.
A lack of automated controls – 28%.
Clunky technology – 28%.

With modern accounting automation software, any errors stemming from multiple data sources, a lack of automated controls, and clunky technology are immediately eradicated. Human errors also become negligible, and, if they do occur, you can rely on the software to immediately flag any accounting inconsistencies.

Access to real-time information

The best system in the world has no value to users who are either unable to access it or don’t know how to get the information they need from it. Accounting Software frees accountants from their desks while allowing users to be actively involved in achieving desired business results, providing full visibility into the entire stream of relevant information in one place.

Timely Insights

Project based businesses require full-featured systems that support teams in managing the three pillars of the project management triangle—time, budget, and scope. Special challenges exist in capturing project-related transactions, billing for work as it is completed, and allocating costs across projects, phases and more.

Accounting Automation Software gives project-centric businesses the power to monitor and manage projects of all kinds from any location, while providing visibility into all aspects of the customer interaction from an opportunity in CRM to an estimate to a sales order and on to a customer invoice, from a purchase order to an accounts payable bill, resulting in expenses and inventory transactions that are correctly and immediately coded to the correct projects.

Other benefits of Accounting Automation

Lower Overall Costs and Improved Morale – Automating accounting workflows decreases the costs of labor, materials, and resources wasted on inaccurate, manual processes. Automated programs can also run 24/7, ensuring time-sensitive, high-priority accounting activities are completed correctly and on time—without making your team members work unnecessary overtime hours or taking them away from more valuable tasks. This ultimately boosts employee morale—improving their work–life balance and giving them more opportunities to use their skills on high-value, business-enhancing projects.

More Creative Teams – And, while we’re on the subject of employee morale, teams that automate are teams that innovate and continually improve their operations. The time and energy your team members have wasted on routine, repeatable tasks can, with accounting automation, be spent on analyzing numbers, making data-driven financial decisions, and developing creative strategies that will lead to sustainable business growth.

Challenges of Accounting Automation

Accounting automation significantly benefits businesses that choose to embrace it, yet there are a few challenges you shouldn’t overlook. For example, the initial investment into accounting automation software can be considerable. Cost varies depending on which software you select. Many accounting automation software options charge on a per-user basis, which means the more users you add, the more it will cost you.

Other notable challenges brought by accounting automation include data security and change management concerns. Data security is a hot topic, and rightfully so as the number and types of security breaches (e.g., accidental exposure, phishing, ransomware, etc.) continues to grow. And making any type of change in an organization—whether big or small—brings with it potential pushback by employees if the change is not communicated well.

It’s essential that you choose an accounting automation software that’s affordable (e.g., offers growth-friendly licensing that charges for resources used, not for each user), provides enterprise-level security, and helps make the implementation process a smooth, user-friendly experience—like Acumatica.

Accounting Automation in Action

“Our contacts are in the system, and we can email invoices, eliminating double entry. We are in the process of converting billing spreadsheets to direct key-ins by the departments, and we know our aging buckets now, which were difficult to figure out in the old system. Every time we do a weekly receivable billing, we put an invoice into Acumatica, and that allows us to know if there are any billings outstanding. We know that we haven’t received them by looking in Acumatica and seeing what’s outstanding. So that helps us with our aging and collections.” – Tammy Raub, CFO, Mozaic

“While payables and receivables are not the most glamorous, we have seen a huge improvement in time savings, and we are much more accurate with suppliers.” – Andy Gale, CFO and COO, LiveView Technologies, Inc.

“Previously we had to (manually) enter most transactions into the billing system, but we can now batch upload bulk information in an efficient manner. Acumatica has also reduced the volume of transactional work, so now our team is doing more value-added tasks.” – Ying-Jian Chan, CFO, The Learning Lab

Accounting Automation Highlights

Accounting automation software helps businesses become more efficient and accurate by automating mundane, repetitive tasks and freeing employees to concentrate on higher value, profit-enhancing tasks.
Implementing accounting automation software comes with a few challenges (e.g., cost, change management, and security concerns), but they’re far outweighed by the many benefits, including faster task turnarounds, immediate data retrieval, increased data accuracy and security, lower overall costs, and happier employees.

View Acumatica’s Project Accounting Solution

Accounting Automation FAQs

How do I choose the right accounting automation software?

Knowing which accounting automation solution is the right one for your business requires diligent and methodical research conducted by you and other leadership team members. Together, you’ll need to determine the features and functionalities the accounting automation software you choose must provide and set your budget. You’ll then need to evaluate the solution’s scalability, usability, and security capabilities. And, finally, you’ll need to assess the software vendor. Are they experienced, have a reputation for implementation success, and continue to provide support after the go-live? The answer for each question must be “yes” before you purchase their product and service.

How do I implement accounting automation software?

Implementing accounting automation software begins by handpicking a reliable and knowledgeable implementation team. Members of the team should represent different departments within the organization, who will then be assigned a specific role, such as the Executive Sponsor (the person who leads the charge and hails from a leadership role within the company), the Project Leader (the person responsible for managing the projects details from beginning to end), and User Community Task Team Members (the people who will fulfill various roles and tasks throughout the implementation at the direction of the Project Leader). Once the team is established, they will work closely with the software vendor, who should provide a defined implementation plan.

Is accounting automation software right for my business?

There are few businesses operating in today’s digital economy that would not benefit from accounting automation software. Automating accounting processes leads to greater operating speed, higher data accuracy, lower overall costs, improved employee morale, and more creative teams—which benefit any business, in any industry.

What are future trends in accounting automation?

Accounting automation will continue to alleviate the time-and-labor-intensive, highly repetitive accounting tasks besetting businesses that have yet to invest in accounting automation software. As the software continues to advance, you can expect to see artificial intelligence (AI) and robotic process automation (RPA) play a bigger role in daily operations, a continued interest in cloud-based accounting solutions, and a sharper focus on sustainable business practices.

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