One of the most important ways to make your company successful is by staying on top of your finances. Paying your bills and paying them on time is key, and that’s where your accounts payable department comes in. Ideally, your AP team will ensure you always have money available to pay invoices in a timely manner. However, there are some common accounts payable mistakes you may come across from time to time.
What Can Go Wrong in the Accounts Payable Process?
No matter how careful your AP team is, mistakes will surely happen. By knowing what can go wrong in the accounts payable process and transitioning to AP automation software, you can keep things running smoothly, ensure bills get paid on time, maintain vendor relationships, and protect your credit rating.
Top Accounts Payable Mistakes
- Double Payment – Double payments are one of the most common mistakes in an accounts payable department. When you have paper invoices and digital invoices coming in from multiple vendors, it’s easy for things to fall through the cracks. Most often, double payments result from a combination of inconsistencies in manual data entry and the lack of a proper review process. Manually entered invoice amounts, supplier information, or even coding can cause an invoice to be paid twice.
- Data Entry Errors – When your accounts payable department relies on manual data entry to pay bills or create purchase orders, data entry errors are sure to happen. Human error is always possible when transposing numbers, missing a decimal point, or incorrectly entering a vendor’s name.
- Batch-Entering Invoices – If your company is processing a large quantity of bills or purchase orders, your AP team might need to batch invoices to save time. While this approach can save your team valuable time, there is no validation to know if an invoice has been entered twice.
- Paying Invoices Prior to Delivery – While being proactive is all part of the job, it can sometimes cause issues for your accounts payable department. With multiple invoices coming in from departments across your company, it can be easy for invoices to get paid without checking to ensure that materials have been delivered or services have been received.
- Unauthorized Purchases – Business credit cards can streamline the process for your employees by making it easier for them to make business-related purchases. However, there may be instances where purchases get wrongfully approved, unauthorized purchases go through, or purchases from unauthorized suppliers show up. These unauthorized purchases can damage your company’s budget and create mistakes in your accounts payable department.
Even in the most efficient AP department, mistakes can be made. But there are ways to avoid these common pitfalls. AP automation software is a great solution. It’s easy to set up and connect to your existing accounting system, plus helps your team operate more efficiently. AP automation also allows your team to focus on profitability and maximizing revenue potential.
Automate Accounts Payable with PaperTrl
From procure to pay, PaperTrl automates the AP process, helping businesses of all sizes simplify and streamline review and approvals, reduce processing time and associated costs, and minimize the potential for human error. Learn more about PaperTrl and contact us for a free demo.