Worldwide, more and more accounting tasks are becoming automated. While this can reduce processing time and increase accuracy for your organization, it can also leave you vulnerable if you’re not careful in selecting processes that will ensure that your internal controls are maintained.
What is Internal Control?
As stated in Chron, internal control framework is “designed to prevent fraud and identify errors before they become problems.”
With accuracy rates as high as 99%, automation platforms are expected to perform up to 40% of accounting tasks in the near future, according to a report published in StarTribune.
As automation assists in your accounting processes, how can you ensure that you keep the internal controls necessary within your accounting & finance department?
What Is Internal Control?
Accounting internal controls are procedures put in place to ensure that your accounting processes are accurate and reliable. This may include separating duties to prevent fraud, limiting access to documents and data, or requiring multiple levels of approvals. As stated in Chron, internal control framework is “designed to prevent fraud and identify errors before they become problems.”
How to Automate Without Losing Internal Controls
New Vendor Setup
With an accounting automation solution, you can speed up processes like new vendor setup, while still maintaining the necessary checks and balances. For example, your vendor management system requires a vendor application form to be submitted and a new vendor to be setup before vendor payments can be processed. In the automation world, once a new vendor form is submitted by the requester, the system automatically double-checks to make sure the W9 is attached. If it is, the new vendor form is routed to the vendor admin to correct or update the included information.
As you can see, this process already includes multiple eyes on the new vendor form, as well as an automated check to confirm that all required documents are present.
From there, the request will be presented to the appropriate managers for approval, again helping you maintain multiple levels of approvals and ensuring compliance. Even better, as your team is guided through the approval process, each step is recorded by the automation platform, creating a virtual “paper trail” that can easily be presented in the event of an audit.
ERP System Integration
If this automated process sounds a lot like your existing process, that’s because parts of it are. The differences can be seen when you look at accuracy of entry, ease of auditability, and the amount of time that can be saved on once-manual tasks like data entry.
How much time does your team spend manually keying in data and printing and filing documentation? When you use accounting automation, advanced OCR capture tools can be used to automatically read your documentation, and email bots can patrol email accounts searching for emails and attachments to file away in the system.
Do you find yourself having to enter the same data into more than one system, sometimes resulting in inaccuracies or out-of-date numbers? With ERP system integration, you’re able to push data from new documents into your existing accounting software, ensuring that your records are always consistent and up to date.
DocuPhase is able to integrate with your existing software, whether it’s a mainstream accounting system or homegrown. To date, we’ve integrated with Acumatica, Microsoft GP, NAV, SL, NetSuite, and Salesforce, and the list continues to grow.
Other Accounting Automation Tools
What else would you automate, if you knew you wouldn’t have to be worried about losing your carefully implemented accounting controls? Would you begin with Accounts Payable, Purchasing & Procurement, Accounts Receivable, Collections, Expense Reports? Companies that are new to automation usually begin with the process where they need the most help and will be able to see the largest impact, and then they expand from there.
To learn more about how accounting automation works and what else it can do for your accounting and finance department, download our free ebook, What Is Procure-to-Pay Automation?