There are plenty of ways to complete supplier statement reconciliation, and with technology paving the way for new and improved methods, we’re excited to see what the future brings.
This blog looks at trends to watch and the various possibilities for the future of statement reconciliation in Accounts Payable.
No more pen and paper.
We imagine statement reconciliation becoming almost entirely paperless as automation becomes the norm. The PPN survey 2023 found over a 5% increase in automation levels of invoice processing. 52% of respondents said that less than 20% of their invoices were processed manually. We see automation continuing to be taken on in the forms of e-invoicing and supplier portals, and with them, automated statement reconciliation will increase as manual processes become obsolete.
Integration inside transactional analysis tools.
There’s lot of statement reconciliation software currently available, standalone or otherwise.
Statement reconciliation can be tied into analysis tools, enabling you to have a full view of your ledger and how accurate it truly is. As the software branches out, more of them could utilise complex algorithms to automate the complete statement reconciliation process, including matching statements. This effectively removes much of the legwork from your AP team, saving them vast amounts of time.
We’ve done this within our own statement reconciliation functionality, which can run in tandem with the existing data we get from your ERP system. The best part of this is that the statements don’t just get compared against particular invoices, they are compared against all of your transactional data. So, you don’t have to collect all of your invoices to compare them. Furthermore, it makes the process more thorough because it continually reconciles your statements instead of having a point-in-time type check. The future only looks to gain speed with this type of functionality. As development of this technology continues, it will allow for even slicker processing, more collaborative efforts and a high level of oversight.
Even more options for statement uploads
With new methods of automation comes new levels of complexity. We see a future with more options for bulk upload. The potential for further integration into supplier portals could enable statements and invoice data to be formatted and sent automatically to your statement reconciliation tools. While many statement reconciliation tools offer uploads from email inboxes, this effectively skips a step in the chain. We can see this type of functionality already in email and ERP integration – is this the final step to a complete no-touch process?
Well, let’s talk about that.
No touch automation and the continued rise of AI
Artificial Intelligence (AI) is no longer a sci-fi story – a human level of intelligence is here. Now, AI outperforms humans in language understanding, reading comprehension, image recognition, speech recognition and handwriting recognition. In recent years, we’ve seen the rise of generative AI, with image and text generation. According to Harvard University, AI Language is the future. In terms of P2P, that means supplier relationships could potentially be handled by a machine. As AI begins to understand nuance, they can write emails that take the individual supplier into account, and the human behind it. No more impersonal automated responses or requests for data. This may not be for some time though.
In its current state, AI needs much human input to deliver an effective piece of generated imagery or text. AI depends on databases of existing information and complex algorithms to decide what to generate. Algorithms and databases have limitations, and it’s only with the inclusion of more data and more complex algorithms that AI can learn and differentiate nuances.
The other potential option is that it could go the other way. If automation really is the key and we fully automate our processes from beginning to end, then machines may well be talking to machines in those instances, and the need for a human to communicate directly with another, or a computer to communicate with a human, will be unnecessary.
And there is the crux of an issue. How much do you leave to machines? How much oversight do we need to ensure our automated processes are running correctly?
More advanced reporting.
We see reporting take a turn. Reporting has gone from static to continuous monitoring to give the most accurate results. We already see software take to-the-minute data changes into account, and generate custom reports. So, what’s next?
As AI gets more sophisticated, we see it being integrated into your reports, allowing it to analyse them on your behalf and pinpoint areas for improvement. It will be able to see patterns and allow you to find problems at the source. For example, with supplier statements, if the supplier consistently does their POs incorrectly and is off by one number, the AI will be able to notice and notify you in case there is an error within their or your system causing this issue.
What’s the future of statement reconciliation?
The future of finance is looking evermore digitally focused, and statement reconciliation is no exception. It’s looking hopeful that technology will continue to improve and save your teams huge amounts of time and effort. While automation and AI are certainly helpful tools, we still see humans at the forefront, overseeing processes and ensuring it runs smoothly.