Automating the accounts function is fast becoming a key requirement for Financial Directors, yet despite this many companies are still struggling to eliminate paper from the finance department.
At the Eclipse Group, we recently commissioned some independent market research looking at document management and storage by finance professionals. The research, conducted by industry analyst, Redshift Research, highlights a lack of understanding about electronic document management processes. In addition, unfounded fears regarding data security and misperceptions about the legal status of electronic information are constraining the adoption of electronic document management systems (EDMS).
Some of the key findings in the research were:
- Just one third of documents within finance departments are scanned
- Almost half of all sales and purchase invoices are still paper-based
- 46% of respondents are still keying invoices into the accounting system
- 35% are still manually moving invoices around the organisation for approval
- 33% believe that auditors require original paper documents
The research results underline the fact that companies need to take a more strategic approach to document management in the finance department. Removing the most labour intensive element of the finance process, namely the handling of in-bound and out-bound paper invoices, not only delivers immediate cost savings but provides a raft of opportunities to drive further benefits – from improving payment timescales to eProcurement.
It is time for companies to stop this half-hearted, somewhat haphazard approach to document scanning – and to address incorrect assumptions about EDMS. Scan all finance related documents; store them securely in a repository; put in place workflow to streamline invoice approval; automate the creation of relevant accounting transactions; integrate with the finance system and finally close the loop by generating all finance department outputs (sales invoices, statements, purchase orders, remittance advices etc) electronically.
From a possible 90% reduction in invoice processing time, to meeting new payment regulation, effective management of electronic documentation is the key to realising the goal of finance automation.
For a copy of the Eclipse Group Market Research Report, download our free eBook here