Accounts receivable software, also known as accounts receivable (AR) automation software, helps companies optimize customer invoicing and payment processes. Its purpose is to ensure customers pay for the goods or services they receive. AR automation software is used to streamline the financial transactions between a company and its customers. It is used by accountants and the employees responsible for accounts receivable, but managers and executives can also use it to track the effectiveness of the AR team or department. Accounts receivable automation simplifies the processing of large volumes of customer invoices, which can significantly reduce the time accountants spend collecting payments from customers. It can also increase the accuracy of invoicing and payment processes, which positively impacts the cash flow of the company and its profitability. From a compliance perspective, accounts receivable automation provides valuable information for preparing regulatory financial reporting. Businesses of all sizes, from small businesses to large corporations, can benefit from implementing accounts receivable management software to optimize their financial processes.
While all accounting solutions include features for AR management, accounts receivable automation is usually delivered as a separate solution providing advanced functionality. It is therefore important to be able to integrate accounts receivable software with accounting solutions and accounting modules of ERP systems. Medium to large companies may also benefit from integration with corporate performance management (CPM) software.
To qualify for inclusion in the Accounts Receivable (AR) category, a product must:
- Manage different types of customer transactions such as invoices, credits, or payments
- Capture and process large amounts of transactions in an efficient manner with minimum human involvement
- Match invoices, credits, and payments with quotes and sales orders to ensure the correct amounts are being processed
- Provide workflows that can be used to define rules and exceptions for accounts receivable processing
- Include customizable approval processes for all types of AR transactions
- Deliver reports and analytics on the status of invoices or payments, customer credit, or transaction history
- Integrate with accounting software or accounting modules of ERP solutions
