RPA technology can save you time and reduce errors. But what exactly is RPA? What does automation in accounting actually look like – and how can it help your accounting processes?
Keep reading to gain deeper insights into RPA, its benefits and how it’s used to make accounting a breeze for finance teams everywhere.
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Key takeaways:
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What is robotic process automation (RPA)?
Robotic process automation (RPA) is software technology that makes it easy to build, deploy and manage ‘bots’ (software robots) that imitate human actions interacting with digital systems and software. Basically, it uses bots to automate repetitive tasks that are normally done by humans.
Not to get too geeky here, but RPA software technology does everything faster and more consistently than a human can, no matter the task. From hiring and onboarding to retail management to finance and accounting, it’s like having a digital workforce that can interact with applications, systems and websites just like humans would – but faster, without breaks and without making typos.
RPA solutions can run across many accounting and financial systems, eliminating most of the manual elements of an accountant’s workday and doing them, well, automatically.
Here are just some examples of what RPA in accounting can do (we'll be diving deeper into these areas later on too):
- Invoice automation
- Expense management automation
- Cash flow forecasting
- Payroll management
- Inventory management
- Practice management
The benefits: How does RPA help in accounting?
According to the PwC Finance Benchmarking Report 2019-20, 30 to 40% of time can be reduced with financial automation. And check out this scary statistic from a Blackline study: 70% of global business leaders and financial professionals claim they made significant business decisions based on inaccurate financial data – inaccuracies that could be avoided through automation.
So how does automation help your accounting processes?
Generally speaking, accounting automation takes most aspects of an accountant’s work day and does them almost instantly. It does the grunt work and number crunching for you, making tasks that were previously complex and overly manual much simpler.
Here are some of the ways in which RPA benefits accounting:
- Improves accuracy by minimising human errors in financial records
- Reduces manual data entry by automatically moving data between systems
- Speeds up repetitive, rule-based tasks like invoice processing and reconciliations
- Reduces operational costs by cutting down on time-intensive manual work
- Enhances compliance by maintaining consistent, auditable processes
- Operates 24/7 without breaks, increasing processing capacity and efficiency
Automating your accounting and financial process can also make it much easier to create reports, provide insights and digestible analytics in just a few clicks. And because automation does this for you, you’re left with more time for the stuff that really matters, like analysis and strategy.
With that being said, don’t worry – accountants won’t be out of work because of RPA. The crucial task of analysing and interpreting data generated by the tool will always belong to the accountant.
What’s more, using software also allows for an accounting practice to expand its client offerings. Automation gives you the tools you need to meet client compliance demands and potentially upsell them on some new services, helping you retain existing clients and become more attractive to potential new ones.
What accounting tasks can be automated with RPA software?
Let’s take a closer look at some of the daily tasks that your accounting team can start automating today:
Invoice automation
Invoices are a huge part of how businesses spend money, and without a proper process in place, they can really swallow up time and create stress.
With hundreds, maybe even thousands, of invoices coming in each month, it’s highly likely that mistakes will be made if done manually – we’re only human, after all. Through automation, RPA software saves you both the time and the hassle of manual invoicing.
Expense management automation
Expense management can easily be automated with expense automation software or RPA. From logging expenses to adding the right receipts to each expense to verifying that no important information is missing from any purchase.
And it doesn’t stop there – many expense management solutions integrate with the accounting software you already use, making exporting expense reports a breeze.
Cash flow forecasting
Management reporting and financial analysis software makes staying on top of cash flow easier, by providing digestible data on profitability and growth.
Most tools have the data presented in an easy-to-use dashboard, which can be very handy if presenting to a client. An added plus – many integrate with the top accounting software as well.
You might also be interested in: Top 4 best FP&A software tools
Payroll management
It’s super important to pay your people, or make sure your clients pay their people, on time. And depending on the business, this can even happen weekly.
Managing payroll includes tasks like scheduling for payments to go out, calculating the right amounts per contract and so on. Handling these tasks manually becomes tedious and accident-prone.
Accounting automation tools can take care of most payroll taxes, like calculating holiday pay, annual bonuses and ensuring everything complies with local tax regulations.
Inventory management
An important part of business accounting is inventory management and how stock items hold in a company’s financial records – think balance sheets and P&L reports.
Lining up your inventory with the company accounts can be time extensive, especially for small or independent teams. Accounting softwares can help automatise and digitise this process by integrating with more comprehensive inventory management systems, giving you the best of both worlds.
Practice management
Let’s not forget about keeping that engine running! You can use a practice management software to automate the day-to-day comings and goings of your accounting practice too.
Practice management software can be used to assign tasks to employees, set deadlines on projects, share documents and store client information.
How do you automate an accounting process?
Automating your accounting processes will benefit your business or practice – but the switch shouldn’t be made overnight. It can be a big change, and there are several steps you can take to make it straightforward and smooth:
Step 1: Take stock of existing tools and processes
Create a list of all the tools you have that affect your finance or accounting processes. This will help you discover tools you could swap out with accounting automation, where improvements are needed and where your main pain points are.
Next, identify what daily tasks are highly repetitive, don’t require a high level of human touch and involve a lot of mental energy – those are the perfect candidates for automation.
Step 2: Choose your tech
Hate to say it (but not really) – Excel cannot be the core of your accounting process. Take the time to evaluate the accounting systems out there that will lay the foundation for your accounting process overall. Test the tools, and remember to pay close attention to the integration offerings each one has. How do the apps ‘talk’ to each other?
Step 3: Identify and test additional automation
Once you’ve landed on an accounting system, identify additional automation tools you think your accounting process would benefit from. Take the time to test these tools out – you may find that some don’t work exactly as you thought or aren't quite what you were looking for.
Step 4: Monitor your new accounting process
Accounting system and additional tools decided upon, it’s time to roll out your shiny new automated accounting system to the team. For the adjustment period, it’s best to assign a stakeholder to oversee the process, answer any questions and listen to feedback.
The future of accounting
It’s easy to find whitepapers and articles asking the loaded question: ‘Is accounting a dying career?’
Not only is that a wee bit dramatic – it’s simply not true. Automation in accounting should be thought of as more of an evolution, allowing accountants to gain even more opportunities from their efforts.
It’s exactly why the software was built! It would be a shame not to use it.
It’s important to future-proof accounting by working with automated tools in order to provide the best service possible. Use the extra time that you’ve gained by automating the more menial parts of the job and show your clients why your relationship is crucial in allowing their business to grow and succeed. And make sure you use some of that time to look internally and identify opportunities that you could work on at your practice too.
So, why not get ready for the future of accounting?
Happy automating!
