Would you be OK with an invoice taking 27 days to move from the business desk to accounts payable?
That’s a question Sharedserviceslink.com recently asked its social media followers. Not surprisingly, the resounding answer was “no.” But it still happens at many companies.
Having a service system that shortens the time to bill is critical to reduce aging invoices. If it takes a week or more to send an invoice to a customer, you have a problem. Remember, you need to add another 8 to 12 days to those 27 days before it’s sent to accounts payable.
It’s important that your time and billing system collects labor, materials and expenses as they occur so you’re ready to issue the invoice on confirmation of work completed. You need mobile web access for a technician’s timesheet so that invoices go out the door on time. That way, the invoice reaches the accounts payable contact and the business desk quickly and efficiently.
An article on Sharedserviceslink.com offers three tips to cut down on aging invoices.
- Invoice submission: Have the supplier send invoices directly to accounts payable. That will cut out the middleman.
- Alignment: Aligning your accounts payable and procurement departments can alleviate problems.
- Electronic invoicing: E-invoicing creates a touchless process that reduces the chance of invoices going missing.
Source: Sharedserviceslink.com, September 2012