CFOtech Australia logo
Technology news for Australian CFOs and financial decision-makers
Story image

Ready to grow: How optimising accounts receivable can put your organisation in a prime position

By Contributor
Wed 6 Apr 2022

Article by BlackLine APAC regional vice president, Claudia Pirko.

Looking to boost your working capital but loath to take on additional debt, given the likelihood rising inflation will see interest rates start to head north sooner rather than later? You’re not alone.

While the cost of borrowing remains low, the events of the past two years have reminded many business leaders of the benefits of a prudent approach.

In a 2021 address to the Australian Finance Industry Association, Reserve Bank of Australia assistant governor Christopher Kent observed the ‘reluctance of smaller businesses to take on more debt in a weaker and more uncertain economic environment.’ 

And just as business leaders have been more loath to borrow, so too have institutions become more cautious about lending. ‘Banks have required a greater degree of verification of borrowers’ information, and banks have been more cautious about lending to new business customers and to the sectors hit hardest by the pandemic,’ Kent notes. 

The automation alternative

The good news is, there is another way, one that doesn’t involve increasing your exposure to the vagaries of interest rate rises. Automating your accounts receivable function can help your organisation improve its cash flow significantly, operate more efficiently and elevate its relationships with customers to boot.

What’s involved? In a nutshell, eliminating many of the repetitive manual processes associated with the business of collecting and assigning payments, including recording transactions, generating invoices and reminders and updating ledgers after funds are received.

Historically, this has been the work of armies of accounts clerks, but today, a cloud-based, automated accounts receivable solution can perform many of these tasks accurately, quickly and far more cheaply.

It’s sophisticated software that’s very simple to implement. Small and medium enterprises can expect to be up and running within four to five weeks, while larger players generally take three or four months to go live. 

And when they do, there are considerable time and cost savings to be enjoyed. For example, organisations migrating to a best of breed platform can expect to reduce manual processing by more than 85 per cent and drive the cost of running their AR department down by up to 70 per cent.

Creating more working capital

They’re compelling statistics and reason enough for businesses to head down the accounts receivable automation path but the cash flow improvements doing so can generate may result in an even more substantial benefit.

While 30-day payment terms are standard across many industries, thousands of businesses know that, in practice, this can mean 50 to 55 days if they’re lucky. 

For a $500 million turnover business, each day that can be shaved off that payment cycle represents around $1.5 million a year in freed up capital. That’s money that can be put to work in the business, reducing the need to turn to external creditors to underwrite operations and fund growth.

By automating the collections process, you’re able to reconcile payments instantly and achieve up to the minute visibility into the payment status of each and every business that buys from yours.

This means you can ensure you’re chasing the right customers at the right times and deploying your resources on high-value customers whose timely payments will make a greater difference to the balance sheet. 

It also means you won’t waste time and effort – and risk generating irritation and ill will – by chasing debts that have been paid promptly but which your accounts receivable team is yet to apply.

Moreover, the rich data set your automated accounts receivable platform will generate over time will provide you with the intelligence you need to make smarter decisions about extending additional credit. 

That means you can allow repeatedly reliable payers to spend more with your organisation, secure in the knowledge that doing so won’t trigger a cash flow crunch a few weeks down the track.
  
Seizing the day

The old saying ‘cash is king’ remains as true as it ever was and, in today’s uncertain post-pandemic economic climate, never more so. Optimising internal processes to improve your cash flow and boost your working capital is a smarter, safer move than increasing your debt facilities. There’s no better place to start than the accounts receivable department.

As your organisation prepares to tackle the opportunities and challenges ahead, adopting automation technology will stand it in excellent stead.

Related stories
Top stories
Story image
Artificial Intelligence
Frost & Sullivan recognises Genesys as leader in new reports
Frost & Sullivan has recognised Genesys as a leader in the cloud contact centre market for its robust cloud and digital capabilities.
Story image
Cybersecurity
Cybersecurity prompts upgrade for 1.3 billion electricity meters
ABI Research finds Advanced Metering Infrastructure (AMI) and cybersecurity concerns are prompting the upgrade of 1.3 billion electricity meters by 2027.
Story image
Digital Marketing
Similarweb acquires SEO and rank tracking company Rank Ranger
Digital intelligence company Similarweb, which specialises in analysing web traffic, has acquired Rank Ranger, a market leader in SEO and rank tracking.
Story image
Employment
Tech job moves - Forcepoint, Malwarebytes, SolarWinds & VMware
We round up all job appointments from May 13-20, 2022, in one place to keep you updated with the latest from across the tech industries.
Story image
Talend
Talend introduces new data health solutions for businesses
Talend has announced its latest version of Talend Data Fabric, with the release of Talend Trust Score enabling data teams to establish a foundation for data health.
Story image
Cybersecurity
More than 40% of banks worried about cloud security - report
Publicis Sapient's new report finds security and the lack of cloud skills and internal understanding of business benefits are big obstacles for banks moving to the cloud.
Story image
Alteryx
Decision Inc. Australia enters partnership with Alteryx
Independent data and analytics consultancy Decision Inc. Australia has partnered with automated analytics company Alteryx, expanding its offering to clients.
Story image
Vectra AI
Understanding the weight on security leader’s shoulders, and how to shift it
Millions of dollars of government funding and internal budgets are being funnelled into cybersecurity to build resilience against sophisticated threats, indicating how serious this issue has become.
Story image
Adyen
Adyen expands partnership with Afterpay as BNPL payments increase
Adyen has expanded its partnership with AfterPay allowing more of Adyen’s merchants in more countries worldwide to use the BNPL provider.
Story image
Remote Working
IT teams deploy powerful technologies to enable remote work
"We found that IT teams mastered the challenges of remote work last year in large part by employing powerful yet easy-to-use technologies."
Story image
Attain
Revenue operations is taking centre stage
As the business world continues to evolve, new demands need to be met to keep up with the ever-changing landscape. 
Story image
Sift
Sift shares crucial advice for preventing serious ATO breaches
Are you or your business struggling with Account Takeover Fraud (ATO)? One of the latest ebooks from Sift can provide readers with the tools and expertise to help launch them into the new era of account security.
Story image
Infrastructure
Nutanix study reveals financial services sector lagging with multicloud adoption
Nutanix has released new research that reveals the financial services sector is lagging behind when it comes to multicloud adoption.
Story image
Microsoft
SAS Viya on Microsoft Azure to deliver 204% return - study
The Forrester Total Economic Impact study finds SAS Viya on Microsoft Azure brings a 204% return on investment over three years.
Story image
Ransomware
Alarming surge in Conti Ransomware Group activity - report
A new report has identified a 7.6 per cent increase in the number of vulnerabilities tied to ransomware in Q1 2022.
Story image
Manufacturing
HINDSITE wins Aerospace Xelerated Pitch Challenge with solution to support Boeing
Brisbane-based startup HINDSITE was the winner of the first ever Pitch Challenge organised by Aerospace Xelerated in partnership with Queensland XR Hub. 
Story image
SaaS
Atturra partners with Focus HQ to support Aus organisations
Atturra has executed a partnership agreement with Focus HQ, to resell and support the company's Australian developed SaaS-based portfolio management platform.
Exabeam
Find out how a behavioural analytics-driven approach can transform security operations with the new Exabeam commissioned Forrester study.
Link image
Story image
VPN
The most common online scams in Australia
No one is safe from online scammers, and many of these scammers have capitalised on the pandemic, using this confusing time to attack more people than ever.
Story image
Artificial Intelligence
Clear Dynamics closes $35M funding round, invests in global growth
The funding is a major milestone and speaks to Clear Dynamics’ vision for AI-enabled ‘composable’ enterprise software, the company states.
The Access Group
Struggling to understand which transformative technologies will help your business? The Access Group provides a look into key opportunities and impacts for finance.
Link image
Story image
Wasabi Technologies
Wasabi opens new cloud storage in Australia with Equinix
Wasabi Technologies has opened a new hot cloud storage region in Sydney, Australia, using Equinix services. This is the company's 12th global storage region.
Story image
Phishing
Google reveals new safety and security measures for users
Google's new measures include automatic two step verification, virtual cards and making it easier to remove contact information on Google Search results.
Story image
Remote Working
How organisations can meet employees' changing expectations
The global employment market has shifted dramatically in favour of employees, sparking the so-called great resignation, in which people are leaving unsatisfying roles in search of greener pastures.
Story image
Remote Working
Australia’s remote workers face connectivity and security issues
SOTI's new report finds better video conferencing technology and improved security measures are top concerns for remote workers in Australia.
Story image
Excel
Could your Excel practices be harming your business?
While Excel has been the de-facto standard for budgeting, planning, and forecasting, is it alone, enough to support organisations in the global marketplace that’s facing rapid changes due to digital transformation?
Story image
Data Protection
Barracuda launches new capabilities for API Protection
"Every business needs this type of critical protection against API vulnerabilities and automated bot attacks," Barracuda says.
Story image
Safety
Voxel hits total funding of $18M following ongoing wins
Since raising its seed round in September, Voxel has grown at pace, by decreasing on-site injuries by upwards of 80% and increasing operational productivity.
The Access Group
Increasing headcount isn't always the best way to grow. A good financial strategy can help solve many issues, and The Access Group shares the secret to success.
Link image
Story image
Artificial Intelligence
SAS launches human-focused responsible innovation initiative
SAS has launched a responsible innovation initiative, furthering its commitment to equity and putting people first.
Story image
Cybersecurity
Hard numbers: Why ambiguity in cybersecurity no longer adds up
As cybersecurity costs and risks continue to escalate, CEOs continue to struggle with what their investment in cyber protection buys. Getting rid of ambiguity becomes necessary.
Story image
Fintech
Airwallex launches new bank feed integration with NetSuite
Airwallex has launched a new bank feed integration with NetSuite, developed in partnership with NetSuite solution partner, Onlineone.
Story image
Mobility
Hands-on review: STM laptop bags
The advent of hybrid working has meant we need laptop bags. We got our hands on two of the most popular laptop bags from STM.
Story image
Artificial Intelligence
SAS unveils AI experience to improve kids' batting abilities
SAS has created The Batting Lab, an interactive experience using AI, computer vision and IoT analytics to help kids improve their baseball and softball swings.
Story image
Ransomware
A third of companies paying ransom don’t recover data - report
Veeam's report finds 76% of businesses who are victims of cyberattacks paid the ransom to recover data, but a third were still unable to get their information back.
Story image
Testing
Google and CSIRO use AI to help protect the Great Barrier Reef
Google has partnered with CSIRO in Australia to implement AI solutions that help protect the Great Barrier Reef.
The Access Group
Health and social care organisations are currently under significant financial pressure. Find out how financial transformation can help provide an effective route forward.
Link image
Story image
trust
9/10 Aussies to stop spending if personal data compromised
"Based on the patterns we are seeing among Australian consumers, it is evident that trust in a brand is exceptionally important."
Story image
Telstra
Telstra, Google and Accenture launch 5G AR experience for AFL
Telstra, Google and Accenture are developing a new 5G powered augmented reality (AR) experience at Melbourne's Marvel Stadium for the footy season.
Story image
Digital Transformation
Trading up: It's time to swap core systems for flexible digital applications
This year will see more oranisations planning and commencing high tech renovations that will shake up the way they operate.
Story image
Digital Transformation
Unlocking the next digital frontier for educational institutions
Understanding where to invest in technology can be challenging for education institutions, especially after the COVID-19 disruptions.
Story image
Public Cloud
Cloud adoption still a work in progress, NetApp finds
NetApp has announced the results of the annual Cloud Infrastructure Report based on a survey of public cloud business and IT decision makers.
Story image
Artificial Intelligence
Updates from Google Workspace set to ease hybrid working troubles
Google Workspace has announced a variety of new features which will utilise Google AI capabilities to help make hybrid working situations more efficient and effective.
Story image
SaaS
Cloudflare launches instant serverless database for dev teams
"Today we’re announcing our first serverless database which we expect will quickly become one of the largest databases in the world."