Your AR automation readiness checklist

How to overcome adoption barriers and guide your company toward efficiency

For many companies that still mail out invoices, collect paper checks, or manage partially automated AR processes, implementing a new accounting solution may seem like a daunting prospect. That’s why it’s often a decision that gets pushed to tomorrow…which turns into next month, then next year.

In fact, 96% of mid-sized businesses face barriers to adopting AR automation: among them, 38% are concerned about upfront costs, 23% worry about implementation challenges, and another 23% express data security concerns.

The key to success lies in a thoughtful selection process. When you take the time to assess your current system, quantify the impact of automation, and evaluate the features and capabilities you need, you can gather momentum and gain buy-in across departments. The clear upside will be too compelling not to resonate.

Let’s take a closer look at how to find the right AR automation solution for your business.

Assess your current system

Start with a clear understanding of how your current AR processes work today. A thorough assessment can help:

• Identify inefficiencies in current processes.
• Get a baseline for measuring improvements after implementing a new system.
• Prioritize certain features and capabilities.
• Gain buy-in from stakeholders by clearly demonstrating current pain points and potential areas for improvement.
• Ensure that any new system will directly address specific needs and challenges.

Questions to consider:

Current AR Process

• How many transactions run through AR on a monthly or quarterly basis?
• How long is it taking the business to manage and process those transactions?
• How are invoices currently generated and delivered after a sale?
• How do customers currently pay invoices and what is the process?
• What happens when a payment is missed or late?
• How are payments processed and matched to invoices?
• How are bank transactions matched to payments?
• How are payments reconciled and recorded before closing the books?
• What is the current process for sending payment reminders?

Performance and capability

• What percentage of sales invoices are late or missed?
• How much time does the finance team spend on manual AR work, particularly cash collection and duplicate data entry?
• How much are credit card/payment processing fees?
• What is the average time from invoice creation to payment receipt?
• What reporting capabilities does the current system have for AR analytics?
• Do you have to leave the accounting system to do various AR tasks–like sending invoices, collecting money, and recording the relative GL entries when receiving payments?
• What security measures are in place to protect sensitive customer and financial data?
• How are user roles and permissions managed in the current AR system?
• Would the business have to plan and pay for additional staff to manage increased invoice volume?

Evaluate the impact

After assessing your current AR processes, the next step is to evaluate the potential impact of implementing software with automation features. This evaluation helps quantify the benefits and builds a compelling case for change.

Questions to consider:

• How much time could be saved on manual AR processes?
  • Estimate the reduction in hours spent on tasks like data entry/duplicate data entry, invoice matching, and payment reconciliation.
• Are late payments or the inability to quickly collect cash causing cash flow issues for your business? How much could cash flow be accelerated by making the payment process easier for customers?
  • Calculate the potential reduction in days sales outstanding (DSO).
• What cost savings could be achieved by reducing errors and discrepancies in AR processes?
  • Estimate the reduction in time spent on error correction and dispute resolution.
• What percentage of working capital could be freed up by improving AR efficiency?
  • Estimate the amount of cash that could move from “on the books” to accessible funds.
• How would improved financial visibility impact strategic decision-making and growth plans?
  • Consider the value of real-time insights into cash flow, customer payment behaviors, and profitability trends.
• How much could customer satisfaction and retention be improved by providing a better payment experience?
  • Consider the potential increase in customer lifetime value and positive referrals.
• What cost savings could be realized by optimizing our payment processing fees?
  • Calculate the potential reduction in transaction fees through more efficient payment methods.
• How much could the risk of fraud or data breaches be reduced through enhanced security measures?
  • Estimate the potential savings from avoiding security incidents and ensuring compliance.

Select a solution

When choosing AR automation software, it’s important to compare features and make sure the tool works well with your current systems, like your CRM. As you look at different options, check how well they handle tasks like payment collection, processing, and reconciliation. In addition—and this is a point that is often overlooked—consider whether the solution offers a truly unified platform for your financial data. Closely evaluate the long-term viability of options that connect your front and back office with third-party integrations, which can be unreliable and result in syncing delays particularly as your business grows.

Questions to consider:

Single source of truth

• Is the accounting solution built on the same platform as your CRM?
• Does it share the same database as your CRM, ensuring a single source of truth?
• Can you access sales, operations, and financial data in one place without the need for integrations?
• Does it eliminate the need for duplicate data entry across systems?
• Can the solution scale and evolve with your business without requiring frequent rebuilds or new integrations?
• How does it support collaboration between departments (e.g., sales and finance)?
• Does it offer real-time visibility into your financial data or will there be syncing delays?

Data reliability and business intelligence

• Does the solution offer advanced data tagging and multidimensional data slicing capabilities?
• Can you easily categorize financial data using flexible or configurable tags?
• What kind of business intelligence and reporting capabilities does it offer out-of-the-box?
• Can you analyze revenue trends across products, regions, or customer segments without exporting data?
• Does it provide interactive dashboards and visual representations of financial data?

In addition to the above, you need to ensure your chosen system meets your specific needs and offers comprehensive features.

Use the following questions to guide your selection process:

Automation capabilities

• What stages of the AR process can this solution automate? Look for coverage of:
  • Payment collection
  • Payment processing
  • Reconciliation and bank matching

Next, we’ll dive into each of these further.

Payment collection

• Does the solution auto-generate invoices from a sale or order?
• How are invoices delivered to customers?
• Does the solution offer automated email reminders to customers for payment?
• Is there a branded payment site for customers to make online payments?
• How user-friendly is the online payment process for customers?
• What security measures are in place to protect online payments?
• Can processing fees be customized and passed through to customers if desired?
• Are digital receipts automatically generated and sent to customers?

Payment Processing

• Are payments automatically recorded and applied to corresponding customer billings?
• Are you able to have full visibility of all payments and fees?
• How often are payments settled and funds moved into your business account?

Reconciliation and bank matching

• Are bank deposit records auto-linked to journal entries?
• Are transactions auto-downloaded and matched to settled batches?
• Are payment transactions cleared automatically?

Your path to accurate data, confident decisions

You can more effectively identify the right solution to automate your AR with a thorough assessment of your current processes, evaluation of the true business impact, and careful consideration of available options.

Keep in mind: Many solutions claim to provide seamless integration for sales and financial data—but unless the data is on a single platform, it’s being “glued” together by integrations and syncing. Having all data reside on a single platform lays the foundation for a single source of truth, which is essential for reliable reporting and real-time financial insights. A unified platform eliminates the need for complex integrations and grows with you as your business inevitably changes.

Whether you’re a C-Suite executive or a finance leader recognizing the need for automation, the right solution can save time and money, speed up cash flow, and provide the visibility needed for strategic decision-making.

Ready to take the next step toward automating your AR? Consider how Accounting Seed on Salesforce can provide accurate, real-time financial insight to help your business grow. Reach out if you’d like to book a demo!