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An In-Depth Guide To Finance Automation

April 14, 2023

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Finance automation is the implementation of specific technology solutions to perform recurring and time-intensive financial operations like data entry. It's becoming increasingly popular in business. Many organizations invest in digitization, especially finance, to ensure cheaper and more intelligent outputs.

Ideally, finance automation drives workflow optimization. You can streamline as many tasks as possible while maintaining agility and quality. That said, this article takes a closer look at financial process automation and how you can apply this in your business,

Technologies Used In Finance Automation

Finance automation may incorporate the following technology solutions:

Robotic Process Automation (RPA)

RPA is a rule-driven method that uses software bots to execute repetitive and rule-based tasks. Particularly, RPA finance meaning is the adoption of robotic applications to reinforce manual efforts in the finance department.

Notably, with RPA software, businesses can automate various digital tasks in finance. This automation includes invoice processing, account opening, tax reporting, loan processing and reconciliations.

Machine Learning (ML)

ML algorithms analyze historical data, investigate patterns and provide relevant insights for better decision-making. The good thing is that you can integrate ML with RPA for better results.

For example, suppose you're using RPA to process customer payments. ML can forecast the likelihood that clients will make timely payments.

Artificial Intelligence (AI)

Artificial intelligence has the ability of computer-controlled robots to mimic a human's decision-making and problem-solving capabilities. While RPA uses logic and structured data, AI develops its logic and uses unstructured data to automate end-to-end. AI is significant in RPA as it processes and converts data into a structured form for RPA bots to understand.

Most importantly, when implementing your finance automation solution, you'd want to work with a well-trusted IT services provider with a proven track record. For example, you can partner with IT companies like Outsource Solutions Group for broad-spectrum technology services and end-to-end support.

You gain access to the already-available IT resources with an outsourced IT provider and leverage the expertise of IT professionals. These professionals can help you improve efficiency and achieve your business goals.

How To Automate Financial Processes

Below are the main steps to automate your financial processes:

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Image: Adobe Stock

1. Identify Potential Financial Processes That Needs Automating

Firstly, you should determine the financial processes that need digitizing. Ideally, these tasks should be repetitive, employ structured inputs, be time-sensitive and have performance rules and procedures. Here are some processes you should consider automating:

  • Accounts Payable: Finance automation ensures you pay all your debts on time. Invoice processing, coding, approval and payment are some accounts payable tasks you can automate.
  • Payroll: You'd want an enterprise resource planning (ERP) system that integrates finance automation. It lets you automatically enter team member data into the system, set different wages and rates, audit schedules and calculate deductions. Also, you can digitize how often the payroll is processed.
  • Accounts Receivable: That includes automatic invoice generation and sending customers automated overdue payment reminders. Also, you can automate the processing of customers' credit card payments.
  • Account Reconciliations: Financial automation can identify discrepancies between internal and external financial documents. This way, managers can take the necessary actions to reconcile accounts.

Automating these processes is best to ensure value-added financial work.

2. Work On A Digital Workflow

You can use software to customize your financial workflow digitally. Customization enables you to eliminate any steps that don't contribute to the intended outcome.

3. Test The Automation Solution

Before deployment, it's essential to test the software solution to ascertain whether it can execute specific financial processes efficiently. Downtimes, the time to complete a task and output quality are some aspects automation can check.

4. Deploy The Software

If the automation solution runs efficiently, you can deploy it across your financial processes. Also, it's crucial to communicate the changes to your team and inform them of what they're responsible for. This extra step ensures a smooth transition and will help you achieve your goals faster and more efficiently.

Benefits Of Finance Automation

Finance automation empowers teams in the workplace. Ideally, when you eliminate tedious and time-consuming work such as manual data entry, you free your financial team to focus on strategy. The following are the benefits of automating your financial processes:

  • It reduces operational costs as it eliminates the need to hire workers to perform time-consuming financial tasks manually
  • It ensures higher accuracy as it reduces errors associated with manual approaches
  • It ensures consistency since computers execute similar processes the same way every time

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Most importantly, concentrating on high-level strategic processes can help turn available data into actionable insights and offer more efficient business solutions.

Conclusion

Automating financial processes using technologies such as RPA can significantly add value to your finance workflow. Above is an in-depth guide to finance automation. Also, it's best to choose a trustworthy software vendor to ensure efficient implementation. This way, you can remain competitive and steer your business to digitally-enabled growth.


NCFA Jan 2018 resize - An In-Depth Guide To Finance AutomationThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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