If you’re considering adopting an electronic payments solution for your business before the end of 2016, then that’s a great start, but it won’t help you to realize the full benefits that an end-to-end purchase to payment solution offers. A complete solution not only automates payments but also provides your employees and accounts payable team with one system to set up automatic workflows and access information about the status of purchase requests, invoices and payments.
To help you with selecting the payment processing solution that will deliver the most value for your organization, we’ve drawn up a list of the 10 most important criteria for choosing the right solution.
One Platform for the Complete Purchase to Payment Cycle
Think beyond just payment processing to consider whether a solution can handle the whole process. This will save you and your team the headache of managing multiple systems for procurement, invoice processing and payments. A complete solution will allow one employee to submit a requisition and get it approved, another employee to receive goods against the purchase order, an AP employee to approve the matched invoice and submit a payment request and an AP manager to approve the payment to a vendor.
Eliminates Paper-based AP Inefficiency with Document Capture
An end-to-end purchase to pay solution will get rid of paper at all stages of the purchasing process. However, this makes the most difference when processing thousands of vendor invoices and payments. With an electronic solution, your AP team gains centralized visibility to all spend – both invoices associated with purchase orders and non-PO invoices. Information from invoices can be captured and a transaction automatically created.
In addition, by moving to electronic payment methods, such as ACH, your team avoids the costly and time-consuming process of printing paper checks, seeking the CFO’s signature and then snail-mailing the payment (which could easily end up lost).
Easy to Use for All Employees from Any Mobile Device or Laptop
This is an absolute must because an integrated purchase to payment solution will mean that employees from all different departments – not just accounting and finance – will use the solution on a regular basis. The solutions that are easiest for employees to be trained on use a common workflow with the same placement of fields and action buttons, whether an employee is submitting a requisition or an expense report or securely approving an invoice for payment from any mobile device.
Unlimited Document Attachments for Transactions
If you’re committing to a paperless process, it is crucial to know that you’ll have all electronic invoices and associated documents at your disposal for review and auditing purposes. Your AP manager reviewing submitted payments should have the ability to drill back to the invoice and original purchase order to review the invoice amount, rebate amount and other details before giving final approval for the payment.
Flexible Approval Workflows
You need to know that requisitions, invoices and payments will receive approval at the appropriate level for different types of purchases at different amounts. For example, your business rules might dictate that purchases of $500 or more require final invoice and payment approval from the CFO. In addition, having different employees perform separate steps throughout the purchasing cycle – from completing the receiving step, to approving the invoice, to initiating the payment, to approving the payment – helps reduce the risk of internal fraud.
Reporting for Audit Trails, Accruals and Cash Management for Forecasting Expenses
You require a number of out-of-the-box reports to help you with forecasting expenses and completing month-end closing. Solutions with advanced reporting can both capture the time, date and approver for audit reports and show all invoice and expense accruals for the month or period. Having a complete record of pending expenses will help your team to make more accurate cash flow projections.
Directly Integrates with Your Bank Account
For an accurate picture of your current cash flow, it’s important that your electronic payment system directly links to your business’s bank account. As a result, your bank account won’t be debited until you’re actually paying your vendors – with the ability to pay your vendors as quickly as possible.
Complete Record of Payment Transaction
Leading purchase to pay solutions will provide you with a full record of the payment made. While your bank statement will record the dates of money transferred, the transaction information will also be entered into your solution and the payment will be designated as completed.
Secure Payment Authorization
An electronic payment system is much more secure than issuing paper checks – as long as the solution follows certain industry standards. One such standard is requiring employees who authorize payments to provide two means of identification when completing a payment; this is often referred to as two factor authentication.
Opportunities for Payment Rebates
As more and more vendors see the benefits of electronic invoicing and payment processing by getting paid earlier (or on time), vendors are increasingly incentivizing customers to implement electronic payment processing solutions. Many vendors offer rebates to customers for using electronic solutions that pay vendors early and without any manual interference on the part of vendors – no more trips to the bank to deposit late checks!
As you’ve seen, there are a number of compelling reasons to seek out a modern payment processing solution that is part of an integrated purchase to pay suite – we’ve just shared some of the highlights and absolute must-have features! After implementing such a solution, you’ll soon realize that the vast improvement in efficiency, accuracy, security and access to vital financial data will make your software investment well worth it.
Interested in learning more about how to better manage all of your indirect spend? Please take a look at PayStream Advisors’ 2016 Indirect Spend Report with recommendations for how to optimize your business’s spend management: www.ariett.com/download/Indirect-Spend-Report-PayStream-2016.pdf