AP Automation and Invoice Processing: Removing Paper Pain
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Paper invoices make up 75-80% of invoices in the US, costing companies significant time and money to process, store, search, and manage. Going digital with accounts payable automation reduces processing costs by up to $1.17 per invoice through faster processing times, improved visibility and workflow, and easier long-term storage and compliance. Key benefits include lower costs, increased efficiency, and productivity gains through faster payment cycles and easier auditing.
AP Automation and Invoice Processing: Removing Paper Pain
- 1. Accounts Payable Automation: Solving the Paper Pain
- 2. Accounting = Paper •The analyst firm Gartner believes that, in the United States, about 75% to 80% of invoices are still paper-based. Source: Gartner, Accounts Payable Invoice Automation, Gartner RAS Core Research Note G00163833, December 2008
- 3. The Costs of Paper •Companies spend $20 to file a document (Time, materials, copy, etc.) •$120 in labor to find a misfiled document •$220 to reproduce a lost document Association for Information and Image Management (AIIM)
- 4. Shipping and Mail •Branch to HQ Shipping Costs •Regional offices send all their invoices to HQ for centralized processing •Even those that scan have image management issues •Time delay
- 5. Payment Cycles •According to IOMA, 25% of all invoices are paid late •Increased cycle times with paper •Data entry errors can lead to added time to search and find invoices Institute of Management Administration
- 6. Searching and Locating •Audits and legal issues can cost $$$ •Physical file searching is painful •Costs of finding, removing, copying and replacing files •Customer service issue
- 7. Archive and Storage •Long term storage costs •File cabinet space •Disaster recovery
- 8. Top Benefits of Digital AP 0.26 0.29 0.34 0.34 0.36 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 Reduced Cycle Times Audit Process Improvement Improved Visibility of Process Lower Processing Costs Fewer Lost Invoices Accounting and Finance Survey Imaging Adoption Survey by Paystream Advisors
- 9. Filing Time/Cost Comparison •Storage Costs for Paper –Time to File: 5 minutes –Cost of Filing Invoice: $1.67 •Scanning and Imaging Costs –Time to File: 30s to 1.5m –Cost: $ .50 *based on $20 per hour
- 10. Summary Paper processing is expensive Digital AP provides a variety of benefits Efficiency Productivity Gains Reduced Costs Invoice Processing Solutions by inFORM