Accounts Receivable Explained
What are accounts receivable?
Accounts receivable is the balance of money owed to companies for goods and services. Oftentimes AR refers to goods and services initially provided on credit, with the expectation that debts will be repaid within a set period of time, usually weeks.
Why is it important to track accounts receivable?
By staying on top of payments due, company leaders can rely on this expected cash inflow to sustain and grow their businesses. CEOs can plan and use outstanding receivables to improve cash flow, reduce debts or reinvest in the business.
This is especially valuable for small businesses, given 82% of them fail due to poor cash flow management and a weak understanding of how cash flow affects their business, according to a U.S. Bank study.
What is Accounts Receivable Technology?
Accounts receivable technology refers to the software and digital tools that enable companies to more efficiently track and collect money owed to them. AR technology allows companies to easily see outstanding bills, send and receive digital invoices, and seamlessly incorporate AR data into general accounting technologies.
By integrating processes for invoicing and billing to the cloud, companies can reduce redundancies, shift grueling workloads to artificial intelligence and automate processes. This effort ultimately saves businesses time and money.
How Accounts Receivable Technology Saves Time and Money
Rather than relying on cumbersome paper billing and manual collection, technology enables companies to streamline and automate accounting processes. By using accounts receivable technology, CEOs can ensure that:
- Payments are coming in as expected and on time
- No receivables are falling through the cracks
- Money is automatically deposited into company accounts
Once a company has adopted cloud-based AR tech, they’ll begin seeing benefits. Notably, they’ll save time and money, which allows business leaders to better utilize company resources and improve cash flow management.
Here Are Three Specific Ways AR Technology Helps Companies Thrive:
Streamlines accounting processes
After an initial set-up where a company can customize templates with their logos and other signage, customized invoice templates can be saved and recycled. Companies can then schedule one-time and recurring invoices, creating repeatable workflows.
Further, companies can utilize a variety of accounts receivable and general accounting technologies to bring all financial data together in one place. Many AR platforms, such as Bill.com, automatically sync with general accounting technologies, such as QuickBooks. This keeps the entire business in cooperation and streamlines the flow of financial data.
Additionally, by linking with other accounting technologies, the general ledger is automatically updated with the most up-to-date information about cash flow. Accounting technology can pull-in historical data to inform financial reporting, budgeting and forecasting, empowering CEOs to make more informed decisions about where to spend company resources.
Frees CEOs to focus on strengths to accelerate business growth
Most financial professionals already know AR technology well
Many small businesses don’t have the budgets to build-out entire finance and accounting departments. Fortunately, Fractional Accountants can be hired on an as-needed basis for a variety of accounting tasks. By working with a trusted outsourcing company, such as The A Team, CEOs can access professionals with experience using a variety of accounting technologies. They can provide initial migrations and ongoing management services.
Revolutionize Your Business with Financial Technology Solutions for Accounting and Accounts Receivable: Saving Time and Money While Adapting to the New Normal
Accounting Technology Solutions
Innovation and today’s rapidly-paced world is pushing organizations to move faster than ever before. Many established businesses, start-ups, and nonprofits are feeling the strain, but there are still only 24 hours in a day. Luckily, there are several accounting technology solutions that we recommend to help make your business more efficient and organized.
Want to Reclaim Valuable Time? Invest in the Right Solutions!
Choosing the appropriate accounting platform depends on a variety of factors:
- Do you have inventory to track?
- Which tasks waste the most time?
- Do you have sufficient clarity into your company’s financial situation?
Excessive time may be dedicated to pursuing overdue invoices, leading to inefficiency and wasted time on fixing errors due to long hours. Additionally, there could be ongoing charges for unused software subscriptions on a company card. Don’t let these things fall by the wayside and cost your company valuable hard earned revenue.
Accounting Technology Solutions Can Help:
A real-life example:
A mid-sized private educational institution was using QuickBooks as their accounting software solution However, QuickBooks did not provide critical reports needed to support payroll processing and automated revenue recognition. Every week, they wasted valuable time creating manual reports. Keith Miscione, The A Team’s Technology Practice Director, developed a single custom report that calculated accrued commissions earned by employees based on multiple key factors, including course registration and completion.
By implementing appropriate accounting technology, the client was able to increase efficiency and save money by decreasing staff size, paying employee commission more rapidly, and making better, more timely management decisions.
Accounting Technology Can Solve Many Issues Without Breaking the Bank.
That’s why The A Team Consulting offers numerous, reliable accounting technology solutions to enhance efficiency and give you back valuable time.
From accounts payable platforms that create a seamless workflow to digital expense tracking, The A Team has the right off-the-shelf or in-house, custom-built technology solution to streamline your accounting processes. Reducing costly manual errors and unnecessary employee time will lead the way to focus efforts on core job responsibilities.
Contact us for a free consultation today!
How Financial Technology Can Transform Your Business
What Is Financial Technology?
Financial technology, often referred to as “Fintech,” is any technology used to digitize, streamline, or automate financial processes in business. These technologies come in either software or software as a service (SaaS) form. The programs can digitize or automate a number of financial tasks every business must handle, such as:
- Tracking income and expenses
- Sending invoices or payments
- Collecting data for analysis or reporting
- Creating in-depth expense reports
- Budgeting and forecasting
Accounting technologies are a huge part of the financial technology field, and perhaps the most utilized and valuable type of Fintech. According to some studies, 83 percent of accountants agree that accounting technology increases productivity.
When Does a Business Need to Use Financial Technology?
Even though not every business starts with financial technology, in the modern landscape, inception is the best place to start. The more organized finances are from the beginning when growth is often at its largest, the more likely a business will succeed. The best technologies make tracking finances more efficient.
Nevertheless, if the business doesn’t start with good technology in place, a few pertinent events should spur the adoption of financial programs, such as:
- The business is going through a rapid period of growth
- The current accountant or accounting department is overwhelmed with daily tasks
- The business sees a major uptick in the number of expenses or invoices.
Is Financial Technology Necessary Even With an Accountant?
Financial technology serves a valuable purpose.
Accountants handle bookkeeping, ledger balances, and drafting financial documents among many other tasks. Financial technology complements the work they do. With the right technology in place, accountants spend less time on mundane tasks and reporting. Therefore, has more time to focus on other finance-related tasks that require human input or attention.
Likewise, financial technologies benefit the entire financial sector of the business, all the way to the Chief Financial Officer (CFO). For example, something like expense tracking software gives the CFO valuable data that could help with strategic future planning.
Modernize Your Business with the Best Financial Technology
The right financial technology revolutionizes the efficiency of financial management within a business. The A Team’s Technology division helps you find the right financial technology for your business. Let’s discuss how the right programs will free up your time to focus on the core business.
A Team Will be Your Go To for Financial Technology
Financial Technology for the New Normal
While no one would deny the importance of robust and reliable financial technology, the COVID-19 pandemic has highlighted the need for strong technology capabilities at every level. Suddenly, while working completely remote, businesses must stay connected, operate efficiently, and manage financial health. The pandemic forced many businesses into uncharted waters.
With experience and know-how in the most current and best electronic systems, The A Team is well equipped to assist your business with effective financial technology during these difficult times. We’ve examined, vetted and deployed a variety of technology offerings that can be fine-tuned to suit your company’s individual needs.
Many small businesses still pay vendor bills manually, entering them into their accounting software for payment by checks, ACH transactions or credit cards. This process requires approval protocols by a manager or owner before the bookkeeper issues payment. When staff is not centrally located, and multiple parties must access vendor bills and checks to use for payments, the process becomes cumbersome and inefficient.
