Advanced Software (return to the homepage)
Guide to finance automation
Blog //07-02-2023

Guide to finance automation

by Grace Child, Head of Product Marketing

The finance function is set to be transformed by automation and artificial intelligence (AI) over the coming years.

Our own Finance Trends Report highlighted that over 40% of finance professionals believe that AI will make critical business decisions by 2030, but only 19% think this technology will positively impact the workplace. This perspective perhaps stems from the fear that automation will replace jobs.

But by automating the right processes (and preparing appropriately for this transition) organisations can experience a new era of productivity and performance. While traditional accounting software solutions may remain functional, they have become outdated and require a lot of manual data entry. This leads to slow decision-making in what is a fast-paced business environment.

The sudden surge of new Cloud systems may seem overwhelming for some CFOs and finance leaders. This is why we’ve put together a useful finance automation guide, to enable finance leaders to better understand both the present and future benefits of this technology.

What is finance automation software? 

Finance automation software is technology that sometimes uses machine learning and artificial intelligence. It is used for financial analysis, payroll administration, invoicing, collections action, and financial statement preparation. The leading benefit of using such software is that it removes unnecessary human intervention.

By introducing automation to financial operations, more work can be accomplished within a set timeframe, therefore boosting productivity in the workplace. This has been made possible by the advancement of artificial intelligence in finance. Put simply, finance processes can be made both quicker and easier through Cloud-based accounting software.

CFOs who have implemented this technology are already reaping the rewards. Reduced finance operations costs, faster turnaround times, and fewer errors are just a few of the associated benefits.

Cloud accounting systems continue to automate more of the mundane jobs within the finance function, while also offering up tangible insights through powerful reporting and data analysis. By increasing employee focus on value-adding tasks, automation has helped to empower finance teams, increase profit margins, and improve overall business performance.

What is standalone automation in accounting?

Finance industry professionals have long used standalone accounting software. In the past, traditional accounting software was typically purchased from a physical store, delivered as a physical product, and installed onto a physical device.

Even though standalone accounting software solutions are still available, it is not the most reliable method to use, as Cloud computing grows globally and hybrid working finance teams become more prevalent. In comparison, these standalone systems feel slow, less flexible, and are perhaps obsolete.

With the implementation of a Cloud-based accounting solution, CFOs can increase the flexibility and security of their finance teams (within a sector that constantly fluctuates).

How will automation affect finance?

Accounting and expense management are just a couple of the core financial processes that can be automated to save time and boost productivity within the finance team. As well as helping with keeping accurate financial records, it also assists with maintaining compliance and making your business more agile.

Additionally, the finance team don’t have to manually maintain spreadsheets. They can instead focus on analysing financial data and trends, helping other parts of the business to be efficient, and pursuing growth.

Is automation a risk to finance roles?

Some businesses may be hesitant to adopt this approach due to the idea that automation puts finance function jobs at risk. But is this realistically likely to happen? For the time being, automation will only take charge of repetitive tasks, such as bank reconciliation, data entry, invoice generation, and payroll calculations. This will improve the capacity of finance professionals, freeing them up for more impactful strategic work.

In the short-term, this will allow employees within the finance function to make a bigger contribution and have greater fulfilment. It will also allow them to learn new skills, master new technologies, and subsequently future proof their individual career prospects. It will be some time before true AI is achieved, which means there will be plenty of time for those in finance to adapt and figure out where they fit in.

Ultimately, the job landscape is always evolving, and it’s likely that new roles will be created by the very systems that replaced them. This outcome will lead to lots of development opportunities, which also means a wider pool of people will have a realistic chance of attaining a career within finance (rather than just those who go down the traditional education route).  

All in all, finance automation can help CFOs to meet evolving employee expectations.

6 finance processes to automate

1. Accounts payable

Receiving, processing, and paying supplier invoices are all part of the accounts payable (AP) process. The accounts payable section of an account is where these transactions are recorded before the payment is made.

Before automation existed, finance teams had to go through invoices manually, try to understand the data, then forward them to systems to complete the records. Anomalies in invoices were rarely discovered and suppliers were regularly contacted to resolve any issues.

Using invoice automation, most of a company's invoices can be processed automatically. In the past, this was also true for invoices received through Electronic Data Interchanges (EDI). The amount of automation also increased for invoices with purchase order (PO) numbers, since the POs included all the necessary details about the invoice. Therefore, it was sufficient to get the PO to process the invoice.

There is, however, a significant share of invoices submitted without purchase orders. Deep learning has become an important component of modern accounts payable automation. Businesses can now identify duplicate invoices, extract relevant invoice details, and create accounting entries based on automatically captured invoices.

2. Accounts Receivable

Generally, accounts receivable is part of the order-to-cash process and refers to the money owed to a company by customers for goods/services delivered. When order forms are submitted as an image by other businesses, the most difficult part of automating this process is extracting the data.

With the right tools, however, even this part can be automated, along with monitoring receivables, sending automated notifications to customers (to keep on top of outstanding bills), and calculating the provision for doubtful debt.

3. Account reconciliation

Reconciliation of accounts is another manual task for finance teams that takes up a lot of their time. Any human errors made in this process might cause significant business disruption.

However, with automation finance teams can:

  • Instantly access ERP systems to extract the relevant information
  • Verify balances between bank statements and general ledgers
  • Reconcile accounts using a standardised format

4. Financial planning and analysis

Financial planning contains the arduous process of preparing and compiling financial statements, using a variety of departments in the Financial, Planning, and Analysis (FP&A) framework. Fortunately, elements of this framework can be partially automated.

These include:

  • The collection and cleansing of data for analysis
  • Generating standardised financial reports
  • Validating and consolidating budget and forecast inputs

5. Source-to-Pay

Source-to-Pay (also known as purchase-to-pay or procure-to-pay) involves the selection of a supplier to complete all payments. It typically involves the collection of invoice and payment information from multiple sources, such as:

  • Supplier emails
  • ERP systems
  • CRM programmes
  • Banks and retailers

But since not all those systems provide simple integration methods, there's usually a degree of manual labour involved for finance teams.

The good news is that CFOs can use finance automation technology to identify manual steps and uncover bottlenecks within these processes (by using process mining tools).

6. Payroll administration

The payroll administration process is essentially a way to arrange employee compensation. Employee hours, pay rates, and compensation can all be regulated and accounted for.

Here are some of the tasks which can be automated within payroll administration:

  • Syncing data across multiple timekeeping systems
  • Identifying and flagging timesheet errors
  • Auditing reported hours against schedule
  • Calculating deductions

How to start process automation in finance

Financial management software has become increasingly popular among businesses, though some are perhaps put off by the daunting prospect of choosing an accounting solution.

Cloud systems are capable of the processes finance teams are familiar with. The main difference is that Cloud applications run off-site via an internet connection rather than on an individual desktop.

A key part of modern accounting and finance involves accessing data anytime and anywhere. If it's chasing debts, staying informed about the next crisis, deciding business strategy, or paying wages, this type of access is now paramount. Below are some quick tips to help you begin process automation finance:

1. Choose the right provider

The best place to start when implementing automation is to choose a reputable Cloud provider with a proven track record. Ideally adopt a Software-as-a-Service model so that all updates and support are included on an ongoing basis.

2. Make sure it has remote access and integration

Ensure the software facilitates remote access, and make sure it integrates with any other system you use (or alternatively use a solution that encompasses all finance function activities).

3. Check the software’s reporting functionality

The final thing to consider is the scope of its reporting functionality. Reporting can be very time-consuming for finance professionals when building reports from scratch. Whereas software solutions with the appropriate capabilities around reporting can compile and present this data instantly, in far greater depth, and with far fewer mistakes.    

Achieving finance automation with technology

Our Cloud-based accounting software has dedicated functionality for all elements of the finance function. Built by finance people for finance people, the user experience is seamless, making financial management easier, while also automating mundane manual tasks.

The system ultimately boosts the adaptability, productivity, efficiency, and scalability of the business, keeping you on the cutting edge and growing in tandem with your ambitions. Finance professionals are freed up to spend less time on basic number-crunching, and more time on collaborative projects, deep data analysis, and informing strategy.  

Financial Management Advanced Financials Blog
Grace Child

Grace Child


Head of Product Marketing

Grace leads the Go-To-Market strategy for financial management at Advanced. Grace focuses on creating value propositions which address the needs of our customers, understanding our key personas, building sales enablement collateral and launching products to market successfully.

Read published articles