Can Accounting Automation Help Your Productivity?

In an article from the CPA Journal, the authors shared this:

"Most companies and governments still spend 80% of their time on data cleansing, which an appropriate machine learning (ML) algorithm can perform in minutes. Thus, the market faces a challenge: accountants with technical expertise are required to design algorithms capable of reducing the human workload. Traditional accounting and business analytics are insufficient to meet current business needs; modern data analytics offer businesses in-depth insight into their daily operations."

In this article, we discuss:

1. A Definition of Accounting Automation
2. Growing Trend of Business Automations
3. Accounting Tasks to Automate
4. Ways to Improve Your Productivity 

Connect your bookkeeping software with your CRM to connect your sales and finances departments and keep data up to date. In Zoho Books, for example, the native integration with Zoho CRM automatically checks for updates to your Accounts (Companies) and Contact records in the CRM, and then it makes updates them in Zoho Books. If there is a new Contact added in the CRM to the Company, your bookkeeping software will automatically add that person as a contact. Or if your existing contact has a new email address, that will be updated for you. This ensures the correct Contact receives an invoice. 

Using this kind of integration, you can also draft invoices from the expected sales in the CRM. This can be done with a workflow in your CRM or using the native integration. For example: Your requirement is to draft an invoice whenever a new Deal / Opportunity is marked as Won in the CRM by the Sales team so that payment can be collected quickly. In addition, you want a notification sent to the finance team that a new Invoice or a new Customer has been created. This process can be completely automated. No more waiting for the sales team to let you know about sales and customer updates. 

With these flows, the finance team does not need to enter data into the Bookkeeping software manually. It is there already so they can focus on important details such as taxes. 

2. Cross-Checking Data in Siloed Systems

When you integrate your different software systems – such as your CRM, payment processing, accounting, and digital signature platforms – then the finance team does not need to jump back and forth between platforms to confirm the data is correct. 

Switching between siloed systems is a poor use of someone's time. Comparing a PDF from the bank with the transactions in your accounting software is also a poor use of your finance teams' time. Many, if not most, of the accounting software programs today include categorization rules to streamline accounts payable and accounts receivable tracking. This tool aims to reduce manual data entry by recognizing common expenses such as a monthly fee for your software and suggesting the correct expense category.

3. Expedite Invoice Creation and Payment Collection

The monthly accounting close process can easily become tedious and lead to stress. Sending invoices to clients, receiving payments, updating accounts, and following up with those who haven't paid yet are among those tasks. Automating the monthly close process can ensure more accurate data and make your life easier. 

Retainer Clients are ideal for automations. There's an option in many bookkeeping software platforms that allows you to auto-generate invoices each month for retainer or recurring invoices. In Zoho Books, we use the Recurring Invoices to achieve this requirement. 

If you use a project management or time tracking software (such as Zoho Projects), then you can connect it with your bookkeeping software to auto-generate (preferably as a draft) invoices from the time tracked on each project. 

Schedule email reminders to automatically follow up with your customers regarding payments. You want to ensure the email templates you use for reminders are personalized using merge fields and include clear instruction for the customer to take action. Properly define the email schedule in your workflow to be based on when the invoice is due and to deliver on business days.

4. Automate Late Payments and Discounts

As if tracking down a customer or client for payments isn't enough of a challenge, then you are forced to also remember to update their invoice with a late payment fee. An alert could easily be missed and you are open to human error when manually adding a late fee to an existing open invoice. 

Use a workflow automation based your business rules and processes to automatically add a late fee to any open invoices based on the due date.

There are many different ways to configure this late payment workflow to include or exclude certain invoices or to generate the late fee calculation. You will want a corresponding email notification sent to the customer once the late payment is applied too. And an extra useful tool is to copy the accounts payable contact on that email notification so that a phone call can be made, if necessary.  

Perhaps you want to give a 5% discount for any client making a purchase over a certain amount. It would tedious to manually find and then apply discounts to every applicable invoice. Instead you can use a workflow with a custom function to find those invoices in your bookkeeping software and automatically set a 5% discount to each one before they go out. 

5. Create and Send Reports