Following the launch of AR automation in 2023, Accounting Seed has announced AP (Accounts Payable) automation as the first product release of 2024. For many finance teams, the accounts payable function can be time-consuming and repetitive. It is one of the areas that is ripe for automation, and Accounting Seed aims to help SMEs by introducing efficiency to their AP processes.
Ryan Sieve, chief technology officer at Accounting Seed, commented, “AP Automation is the answer to the market’s desire for truly embedded finance. We know the entire AP process is cumbersome, but with AP Automation, we are enabling our customers to save time and streamline all the activities that touch the AP process.
“The Accounting Seed team is thrilled to bring this functionality to market and further our mission to help companies make faster and more accurate business decisions.”
AP Automation
While there are several add-on AP automation suites available, the advantage that Accounting Seed has is that its AP Automation capabilities are fully part of its finance solution no integration required. It means that AP clerks will immediately see a benefit from using the system without having to switch to alternate pieces of software.
The new features automate the process of ingesting bills onto the solution through invoice matching, all the way to payment to reconciliation. With this process improvement, organisations also gain better visibility of the cash flow process, reduce errors and lower the fraud risk.
AP Automation is available now, and costs are available on request. The initial launch is limited to clients operating a US-dollar entity only. What isn’t clear is when it will be available for international customers. Customers who are interested in activating can contact [email protected]. Accounting Seed confirmed that there is a cost associated with the new AP automation feature.
The solution comprises three key components, each of which automates key elements of the Accounts Payable process.
Email to payables
This component takes emails received from suppliers and automatically creates the payable invoices directly on the Accounting Seed platform. Users first need to create an email account and inform suppliers to send their invoices to that account.
Once created, for any email sent to that address, Accounting Seed automatically creates an invoice with the supplier details based on the email domain of the sender that was previously set up on the contact record. The user is then able to view the invoice on the screen and enter the details contained on the AP invoice.
The invoice is displayed on a split screen with the entry form about the invoice image. The solution does not, however, contain any OCR capability that automatically captures the information contained on the invoice.
Enterprise Times asked Mary Balmer, Director of Product at Accounting Seed, about this and the file formats the email import feature supports.
Balmer replied, “Our Email to Payable feature does not include OCR to capture invoice details. We plan to leverage recent advancements in technology to convert images to text in an upcoming release. To answer the second part of your question, we support pdf, doc, docx, xls, xlsx, ppt, pptx, png, jpg, jpeg, bmp, gif, tif, tiff.”
Payment Proposals
The Payment Proposals feature assists finance teams in determining which payments they should make. Users are able to search and filter based on multiple criteria. They can then select invoices they believe are optimal to pay. Balmer confirmed that AccountingSeed has not leveraged Salesforce AI to automate this process. It will be interesting to see whether Accounting Seed develop this functionality.
Users first set up a payment run with a specific future date, bank account and whether or not they wish to aggregate payee invoices. They are then able to use a search function or advanced search function to filter the different conditions they wish to consider. These could include the due date, account, and early pay date. Once filtered, the user can see invoices and credit notes that can apply against those invoices.
Advanced search offers even more
The advanced search enabled the user to filter by additional fields, including custom fields that the organisation might have set up, perhaps relating to a specific contract. The advanced search also enables the application of boolean operators, such as equals, not equal, and contains. The user can add logic statements such as AND and OR and also filter results based on a Salesforce report. This allows users to create complex reusable features, further reducing the work required for each payment run.
Users can add a single invoice or all the filtered invoices to the payment run with a single click. Once the list of proposed payments is selected, the user can pass the list through an approvals process if set up. They can also change the status to approved, where they have the authority. The appropriate cash distributions are then created. However, it is the automated payment distribution feature that will assist users with one of the most painful elements of AP.
Enterprise Times also asked Balmer, what reporting is available to highlight anomalies? What authorisation process is there? How does it support separation of duties?
“The status of payment distribution is available on each payment record, along with error messages that may have been returned. These fields can be easily viewed in a list view or on a report. To strengthen internal controls over spending, an approval workflow can be configured on the Payment Proposal record to ensure the proposed payments are approved by the appropriate individuals before they are sent out to vendors.”
Automated Payment Distribution
Accounting Seed has partnered with Edenred Payment Solutions to deliver this third component of AP automation. For Automated Payment Distribution to work, both customers and their payees must be onboarded with the Edenred platform. Suppliers can select their preferred payment option from Virtual Card, ACH or Check payment.
It means that the payment is automated through a secure and regulated third-party platform. If the supplier selects a check payment, the details are sent to a third-party check printing service. That company then prints and mails the checks.
The process is initiated when a permissioned user clicks on the pay button for an approved set of payments. Or, when a scheduled job runs, that automatically pays any pre-approved payments on a specific date.
When pay is clicked, cash disbursements are created and automatically applied to payables transactions. The user can then post the cash disbursements to be automatically distributed against the invoices.
Accounting Seed creates the appropriate audit trail, and users are able to identify when and how each invoice was paid. In future updates, Accounting Seed is also looking to aggregate cash disbursements into bank disbursements. It will reduce the number of transactions in the bank.
More to come
As Balmer indicated, there is more to come around AP Automation. Edenred is a European-based fintech company. It means that support for European and other currencies is likely to be supported soon. Edenred connects 60 million users and 2 million partner merchants in 45 countries via close to 1 million corporate clients.
Steve Lorenc, chief executive officer at Accounting Seed, commented, “AP Automation is designed to empower users with unparalleled efficiency and elevate their Accounting Seed experience. By streamlining both the AR and AP processes through enhanced functionality, Accounting Seed is enabling customers to achieve more with greater ease on a single platform, fostering a new era of productivity and growth.”
Accounting Seed is hosting a webinar on February 28th at 1 pm EST, Automate your Accounts Payable (Registration required)
Enterprise Times: What does this mean
This is a welcome update from Accounting Seed. The Automated Payment Distribution feature is a significant step forward. It removes much of the payment burden from those companies that regularly deal with the same suppliers.
The Payment Proposals feature is highly flexible. However, Accounting Seed seems to have missed a trick by not embedding some algorithms that recommend payments to customers. Similarly, the email to payables falls short of a fully automated solution. One takes advantage of OCR technology, something that Xero, Sage and QuickBooks already offer.
Key to this is the price that Accounting Seed is putting on this new product. Automated Payment Distribution certainly warrants an increase in price. However, the other components could be seen as merely iterative improvements on the platform that don’t warrant an increased fee.
