Geraldine Cruz, Senior Director, Product Marketing
Efficiency. Productivity. Cost savings. Those are the typical benefits attributed to payment approval workflow (PAW) solutions, and they are compelling. But other reasons justify investment in a solution that routes payment requests automatically to designated reviewers to approve; and that captures the audit trail between receipt of the invoice and the ultimate payment. Consider the following benefits:
- REDUCE PAYMENT ERRORS: How do you ensure your business is paying only the amount it is obligated to pay against an invoice? How can you ascertain that your business has not already paid the invoice in the past? If your business is like many typical organizations without a PAW solution, your checks and payments are overseen by a set of approvers through the manual hand-off of payment documentation. But without an integrated view of product or service received and invoice, they may not catch invoices that have already been paid, and they may not reject paying the full price to a vendor that did not fully deliver a service or product.
A fully automated PAW that provides supporting documentation for payments will alleviate these errors. When an invoice is entered into the system, it is automatically routed to designated approvers, initiating the capture of data for the payment audit trail. These approvers evaluate accompanying documentation, review comments from other approvers, request additional information to append to the payment request, and decide if this is a legitimate payment to make. Approvers can reject, approve, or approve a partial payment based on the full history and documentation supporting an invoice.
2. REDUCE PAYMENT FRAUD: The typical payment process is fraught with vulnerabilities to fraud. A PAW solution helps a business identify questionable payments, and the audit trail provides visibility into the actions and decisions of the participants in the approval and payment process. Payment requests that fall outside of established business rules — such as payments exceeding set limits — are flagged and treated as exceptions, making it difficult to avoid extra scrutiny. Without a doubt, fraud could happen in other steps in the in the payment process, but a PAW solution ensures that payments have undergone the appropriate level of review defined by the business.
3. SECURE YOUR DOCUMENTS AND RETRIEVE THEM WHEN NEEDED: Because approval requests and the associated documents are automatically routed to the individuals assigned to review a payment request, they are not left languishing on someone’s desk for passers-by to read. Nor are there instances where sensitive documents and email threads are forwarded inadvertently to individuals who do not need to be or should not be able to gain access to those documents. And when those supporting documents and approvals are needed — as in a business review or an audit — your staff can quickly find them and answer the relevant questions.
4. PREPARE FOR AUDITS MORE EASILY: Your business may be subject to audits to evaluate its compliance with regulations, ensure the integrity of financial statements, and the furnish evidence of the establishment of internal controls. The payment audit trial of a PAW solution can facilitate fulfillment of these requirements with its ability to track the history of a transaction. If or when your business is audited to demonstrate compliance with the requirements, the audit trail can furnish that you have established a system of evaluating and authorizing transactions.
5. CONTROL PAYMENT TIMING MORE EFFECTIVELY: With a PAW solution, you can control the timing of payments to address your business need. If you would like to expedite payments to enjoy pre-payment discounts, the automated routing process promotes speed. Visibility in the approval process can help identify and alert approvers that have not responded to an approval request, thereby accelerating turnaround time. Conversely, if you would like to optimize cash reserves by delaying payments, you can include approvers who assess the best time to issue payments.
And to the extent that the PAW solution supports mobile devices, the supporting documents can be accessed anywhere, at any time. Approval decisions can be made quickly — without the requirements of being in the office to review paperwork or having one person retrieve and scan and email all the documents to approvers.
A solution to automate and streamline your payment approval workflows has more benefits than simply efficiency. An upcoming white paper published by Bill.com will highlight additional benefits and discuss features that you should consider in evaluating solutions to fit your business needs.