Why AP Automation is a Must for Hotels
Is your hotel Accounts Payable team buried under invoices? Harried, stressed, balancing invoices, due dates, approvals, and dragged down by manual entry processes?
It doesn’t have to be this way. Imagine a streamlined future where invoices are automatically scanned, data recognized, sorted, and coded into the accounting system. Where your team wins back ⅓ of the time previously spent on invoices. And where your executives get better visibility, cost savings, and confidence in the data being up to date.
That future can be a reality by automating your Accounts Payable with your hotel accounting software. Let’s talk about how to get there.
Accounts Payable (AP) is a crucial function for every hotel and hotel management company. It involves managing bills, payments, and vendor relationships in order to optimize cash flow. For hotel companies with a larger portfolio, the number of moving pieces multiplies and can be downright complicated.
AP departments often receive a high volume of invoices which can come in various formats. These invoices must be read and then manually entered in your accounting system, creating a host of potential issues from data entry errors to late payments, even fraud.
Luckily – there is software for that! Automated AP software can significantly streamline and enhance the AP process. Of course, the greatest benefits are realized with AP automation software directly tied into your hotel-specific accounting software. With tightly integrated AP automation and accounting software you can get real-time synchronization of data, so there is never any lag or gap in your financials.
What software works well together? Hotel Investor Apps (HIA) has created a tight integration with leading AP automation provider, Factura.ai. Factura.ai specializes in multi-location and multi-entity businesses ideally suited for hospitality.
HOW IT WORKS
With Factura.ai, your organization uses a single email address for all vendors to send invoices for all hotels in your portfolio. Then, Factura.ai uses the most advanced AI optical character recognition (OCR), which also continuously learns and improves over time, to extract and code the invoice in less than 30 seconds.
With the HIA integration, Factura.ai pulls your vendor list and your chart of accounts. This way, when invoices come in they are coded to your general ledger (GL), whether the invoice is for a sum total or includes many line items. You are alerted to new items and any errors (duplicate invoices, etc.) to quickly make corrections. The system then intelligently remembers GL codes based on descriptions as well as data mapping.
AP Automation and Accounting together is a dream team solution to increase efficiency, save costs, improve accuracy, enhance visibility, and enable greater security. Let’s look at how this works.
As discussed, AP automation eliminates the need to manually enter invoice data, code it to your GL, and scan or attach invoices to the bill in your accounting software. Not to mention, eliminating the need for filing cabinets! In HIA Accounting you can quickly search by vendor, invoice, and even the amount to look up the original invoice and see the scanned copy.
What does the research say? According to the Ardent Partners 2019 State of ePayables Report, a highly automated accounts payable department takes less than one-third the time to process an invoice, compared to their less automated peers. The same reports also found that highly automated payables departments take less than one third the time on average to approve an invoice. What could your AP team do with a 33.33% time savings on invoices?
To learn more about the savings gained through automation, check out How Hotel Automation Saves Time and How to Get the Most Out of It.
The cost savings reaped from automated accounts payable is not only the reduced labor – due to increased efficiency and reduced errors; but greater organization and transparency will help your team avoid late payments and penalties, as well as take advantage of early payment discounts.
Since invoice data is captured digitally and manual data entry is eliminated with AP automation, the risk of errors is greatly minimized. Additionally, in Factura.ai you can set up alerts to be notified if an invoice is ever over a set threshold, over an expected number of invoices, or if there is a missing invoice – and that can be by property or across all properties.
The Ardent Partners 2019 report also found that highly automated payables departments report less than half the percentage of invoices that result in an exception.
Improved accuracy means less time fixing errors and more reliable financial reports so that your executive team can feel confident in their management decisions.
Using an automated AP software that is built for a high volume of invoice processing and accurately codes each invoice in less than 30 seconds, means that the AP department can stay abreast of each invoice and respond promptly to vendor enquiries. The CFO and management team also has real-time insight into the status of invoices, approvals, and payments. The visibility enables improved cash flow management. Plus, by channeling all invoices to a single email address, the hotel management company can avoid surprises due to unreported invoices from a disorganized GM or property.
Improved security through AP automation and accounting integration happens in several ways. Both HIA and Factura.ai are audit ready with detailed audit trails that record all actions taken within each system. The administrator can always look and see who made what change. In addition, duplicate invoice detection is a hedge against fraud. Your data in HIA is secure with data encryption, multi-factor authentication, and access restrictions based on user-role. You always remain in control of your data, your process, and your bills.
MORE AUTOMATIONS BEYOND AP
With the HIA Accounting and Factura.ai integration, the efficiency goes well beyond invoices but also includes workflow automations with automated approval processes, splitting invoices with intercompany accounting automations, simple reclassification options, role-based dashboards, recurring invoice transactions, and report scheduling. All to help your team get greater efficiency, visibility, and reliability out of AP.