12 Aug, 2020 | Blogs
In the world where the global economy and business environment are changing with a blink of an eye, robotic process automation (RPA) has become one of the fastest-growing concepts. It has enabled companies to streamline business processes by deploying a computer bot to handle labor-intensive and repetitive tasks.
One such contender for RPA is finance and accounting departments since it involve routine tasks that are predictable, tedious, and require high attention to detail. Accounting processes like Accounts Payable and Accounts Receivable are crucial for the overall functionality of organizations. Despite that, they are susceptible to human errors that can cost dearly to any organization. Therefore, accounting provides the ideal conditions for deploying RPA bot to handle all these pain points.
The benefits of RPA in accounting are many. From being a virtual workforce that can capture data and interpret it to the capability of communicating with legacy systems, having an RPA can be rewarding in many ways. In this blog, we’ll look at the top 5 risks and benefits of RPA in accounting.
Top 5 benefits of RPA in Accounting
RPA bots interact with legacy systems, implying that they do not disrupt processes already in place. Compared with other traditional IT solutions and accounting software, RPA can be implemented at a fraction of the time and cost. Other benefits of RPA in accounting are:
RPA robots can be programmed to mimic human user actions within a given workflow. Some of the actions that the bot can do are log into applications, read, extract and enter data, move files and folders, fill forms, scrape browsers, etc. When bots perform these tasks, you can redeploy your team to more strategic assignments that add value to the overall productivity of the company.
Think of the amount of time spent on collecting and entering data associated with invoices. Since all the information has to be extracted from various systems, doing this manually can result in human errors and a lot of repetitive work. RPA bot, when deployed, interacts with multiple data sources, collects all the information, and enters it into the system.
When robots take over manual work, it saves a lot of precious man-hours. For instance, processing invoices in various formats and layout can be a daunting task if done by a regular employee. However, if you have a “digital employee” (robot), it can make use of the optical character recognition (OCR) software to recognize several types of invoice formats and process them instantly. It results in a faster turnover of documents for approval, resulting in faster clearing of suppliers’ invoices.
Trivia: Did you know RPA can also reduce processing costs by up to 80% (UiPath).
One of the biggest benefits of RPA in accounting is the elimination of errors. Finance and accounting departments deal with critical numbers, which when misreported can cost dearly to any organization. That is why accountants are usually under stress to avoid errors while entering data from one system to another and preparing reports. But to err is human but to fix those errors, RPA is there! RPA software is programmed to follow rules and can work without any breaks or vacations. With machine-learning and OCR, they can handle data without making any mistakes, resulting in higher accuracy, consistency, and compliance.
Following up on our last point about the accuracy, another great benefit of RPA in accounting is higher compliance. With the business environment and regulatory regulations changing rapidly, compliance can become a challenge, especially when it comes to recording processes for historical auditability. When RPA is used, the bot reduces the scope of errors to none, and each step has a trail for ensuring full compliance with financial regulations.
Better Customer Service
Deploying an RPA system allows organizations to improve customer service, get a competitive advantage, and scale operations while reducing cost. The slightest error in reconciliation can lead to a delay in invoice processing and claims settlement. By automating most of the manual, time-consuming work, RPA bots can lead to better accuracy, lower the amount of oversight as well as exception handling and intervention that is need needed in these processes. It ensures a higher level of customer service and more strategic work for your team.
Five Risks of Automation in Finance
Now that we have seen the benefits of RPA in accounting, let’s focus on the risks associated while deploying RPA in your organization.
- The biggest risk of RPA is the platform itself. Improper design of the bot can impact your IT infrastructure. That is why doing a proof of concept (POC) is a must. Read more about POC here.
- If the bot is programmed incorrectly, it can lead to repeated automation errors, which can result in the accuracy of regulatory reports. Make sure to have consistent oversight during the development stage and later.
- A poorly programmed bot can also increase processing errors. That is why it is essential to have the expectations stated clearly before proceeding with the bot development and internal controls in place.
- Implementation of RPA bots can result in fear among employees about job losses. That is why communication is essential while rolling out RPA projects. Employees need to understand that the bot is their assistant than their replacement.
- Finance and accounting departments have to create several financial reports, which can be jeopardized if the bot is designed badly, leading to reputational damage and financial restatements.
- Common RPA Mistakes
Watch the webinar: RPA in Finance and Accounting
The benefits of RPA in accounting can only be realized if you have a trusted partner who knows how to get things done. That is why we are here to help you with all your automation needs. Our technology suite and consulting approach not only give you the best-in-class platform but also allow you to achieve a competitive edge and eliminate errors while operating in a faster and more agile manner.
If you’d like to talk to one of our RPA experts and take the conversation forward, then contact us today!