Getting the most out of the Accounts Payable Department

Getting the most out of the Accounts Payable Department (part III)

This article is the third in a series of three, under the title "Getting the most out of the Accounts Payable Department", deals with the basic concepts that influence the productivity of Accounts Payable departments:

Getting the most out of the Accounts Payable Department (part II)

This article is the second in a series of three, titled "Getting the most out of the Accounts Payable Department", dealing with basic concepts that affect the productivity of Accounts Payable departments. In the first article in the series we talked about the cost of the process of Accounts Payable, in this second we deal with the improvements derived from automation and error rates, and the third will discuss fraud and duplicate payments, financial Controls and provider satisfaction. 

Getting the most out of the Accounts Payable Department (part I)

Effective management of working capital, defined as current assets minus current liabilities, is one of the oldest practices of financial management. Following this practise the maxim was developed that short-term needs should be financed with short-term cash; and long-term needs should be financed with long-term sources. The underlying goal for the business is therefore essentially to reduce operational risks and costs of financing.

Accounts Payable Indicators

3 essential indicators in Accounts Payable Management

A recent "Metric of the Month" from shows us the damage that late payments can cause in the relationship between buyer and seller.  

Reasons for outsourcing accounts payable

10 reasons to consider outsourcing AP tasks (Part II)

Our last post consisted of the first part of the reasons for, or that should at least be considered, in the outsourcing of AP tasks.  In that post we spoke about the justifications, such as cost optimization, process automation, application of workflow technologies and solutions, cost flexibility or the standardisation of costs.  

foco en lo importante

10 reasons to consider outsourcing AP tasks (Part I)

95% of companies listed on the NASDAQ have outsourced part or all processes associated with Accounts Payable (AP), while in Spain, currently only 17% of companies in the IBEX have adopt this strategy of outsourcing. Many AP departments use outsourcing as a way to improve the operation of its processes, but outsourcing does not have to be complete, hence, depending on what is not outsourced, and to what extent, benefits arising are different.


eliminate the I in ROI

Remove the "I" of ROI (Return On Investment) in Invoicing processes

Ironically, the phrase “To save money you have to spend money” is accepted as an axiom.


Based on the concept of "return on investment" for years companies have invested huge amounts of money on the latest and most efficient technologies with the expectation of maximizing profit, only to be disappointed in the long run.

Policies based on outsourcing are based on financial strategies transforming CAPEX into OPEX strategies.


Why not Outsource Accounts Payable?

We all know the answer to the question: What can potentially be outsourced? Those processes and tasks that do not add value to the company or are not aligned with the main business objective the Company are likely to be delegated to third parties.

processing long invoices

The problems of long invoices

The Accounts Payable department receives invoices in all forms and formats imaginable. In this entry we will analyse the multi-page invoices which require an individualized and detailed treatment of the information contained.

hereditary AP process

A change of ERP is not incompatible with a continuous improvement in AP

On average, companies change their ERP every 8 years.  One of the tasks that takes most time is the analysis of the purchasing process and provider invoices or accounts payable (AP) for its adaptation to the new system.  The simple process of registering invoices take on average 18% of the implementation time. Much time is dedicated to adapt the new system a manual and imperfect process, repeated for many years due to the requirement "We register invoices this way."  In short, new names for transactions and more attractive interfaces but the same old processes.


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