Let’s start with a statement of the obvious: COVID-19 has affected every aspect of our personal and professional lives.
Nearly just as obvious is that the pandemic has affected business results and the global economy. But perhaps less obvious is the notion that current circumstances have a determinate bearing on the function of accounting. Even more to the point, the current crisis is affecting cash management in big and small ways.
Specifically, A/R is swelling. As AICPA President and CEO Barry Melancon wrote in a letter to U.S. Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell, “because of these extraordinary current economic conditions, businesses that normally receive payment for goods or services within 30 days are now experiencing significant slowdowns in payments (90 days or more).”
That’s not good. And not only are suppliers getting paid later but for many of them, there’s simply less business coming in the door, as receivables or otherwise.
Whether you’re a public accountant, a CFO, or a salesperson, the confluence of these forces boils down to a singular cash management truth for the foreseeable future: You cannot afford to be anything other than excellent at collecting outstanding debt.
What’s more, because you now also need to drive other parts of the business harder than ever, you can’t afford to simply spend more time on A/R.
So how can the problem be solved? Here’s a novel idea: just don’t do A/R. You heard me right. Stop doing accounts receivable. You already had enough on your plate before the pandemic. Why go deeper into overtime on work that software can do? Why spend precious cognitive cycles on collections when software can do it for you, and do it better and faster than you? In hiring software to cover the tactics of A/R, you may now re-hire yourself and your team to tackle the truly strategic challenges accumulating at your doorstep daily.
For some, automation may sound too exotic or emergent to entrust with functions as critical as billing and collections. For several years now, automating financial operations has been seen by some as more of a long-term imperative, woven into the broader digital transformation agenda. But now, as we grapple with a worldwide pandemic, automation is no longer board-level strategy talk--it’s an existential mandate.
Pandemic-Proof Cash Management with A/R Automation
May 28, 2020 Free Webinar | 4:00 p.m. Eastern Time | Presented by Adam Weinroth
Join the experts at Invoiced, the #1 rated accounts receivable automation platform, for this webinar on how the pandemic is affecting A/R along with a detailed demonstration of how businesses are using innovative A/R automation technology to get paid faster, spend less time on collections and provide an easier payment experience for customers.
Register here for this free one-hour webinar.
For some, this mindset shift is hard to accept, in part because there are lingering myths about financial automation. Here are a few of those myths and why they are wrong:
Myth 1: Automation only covers marginal tasks.
False: In 2020 accounts receivable automation is now being used for the entire invoice-to-cash lifecycle. Not only is it possible, but it is easy to put complex invoice generation, multi-channel collection reminders, payment acceptance, reconciliation, cash application, and more on autopilot. Automation can handle the meat and the potatoes of A/R, not just the parsley.
Myth 2: Automation simply reduces my workload.
False: This assertion implies that less work is being done by people. Once you set up accounts receivable automation, you’re not going to be spending less time on work. You’re going to be reallocating yourself to more strategic matters that are a higher impact on your business and your clients’ businesses. As a result, you will be advancing more meaningful projects and client service at a faster pace than you would be able to otherwise.
Myth 3: Automation is just a more efficient way to achieve the same outcome.
False: After enabling accounts receivable automation, you will see different, better outcomes. Chiefly among those are reductions in average time to pay (at Invoiced our clients see an average time-to-pay reduction of 14 days). But you will also see fewer errors. And more importantly, if done right, you will be providing a better payment experience for end payers with the use of a self-serve billing and payment portal.
In addition to those myths being mythical, there’s some other good news. For starters, implementing accounts receivable automation isn’t as hard as it sounds. With a solution like Invoiced, you can sign up for a free trial and connect it with QuickBooks Desktop or QuickBooks Online in just a few minutes. You can then configure your settings, set up your payment gateway, and begin automating accounts receivable on the same day.
The other good news is that while you may be implementing accounts receivable automation to remediate current economic conditions, you’ll find that once we get our collective heads above these tumultuous pandemic waters, you’ll have put in place an ongoing performance and customer experience advantage for the long term.
As an accounting expert, you already understand well that for every new system you implement, there will always be some level of risk and cost associated. But with the current set of cash management obstacles accounting professionals are faced with, most businesses are finding that they just can’t afford not to make this key investment.
Remember, Insightful Accountant is hosting a free one-hour webinar for Invoiced on May 28th at 4:00 PM Eastern. Adam Weinroth with Invoiced will be discussing how the pandemic has been affecting A/R. He will also be demonstrating the use of innovative A/R automation technology to get paid faster, spend less time on collections and provide an easier payment experience for your customers. Be sure to Register Here for this free one-hour webinar.
About the Author:
Jared King is Co-Founder & CEO of Invoiced, the category defining company in the field of A/R automation. Jared built Invoiced from a small bootstrapped startup to a thriving global A/R platform now serving the billing and collections needs of thousands of businesses in 92 countries. In 2019 alone, Invoiced was used by clients like Uber, Ticketmaster, Kayak and others to manage and process more than $10 billion in receivables.
With Invoiced at the center of sweeping digital transformation and automation of the accounting function, Jared, as CEO, occupies a uniquely influential role in advancing the accounting profession and shaping the industry’s collective vision for modern A/R tools, metrics and methodologies. As a result of the continued success and influence of Invoiced within the accounting world, Jared is sought out by accounting trade publications, business media outlets and industry events.
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