Integrated AR Collections: Streamline the AR collection process with the Task to Cash workflow

Managing a CPA firm has never been more challenging. With the severe economic impact caused by the corona virus pandemic, many CPAs are facing tough times. On one hand. they are rising to these unprecedented times by helping their clients with stimulus checks and by clarifying all their concerns related to the Paycheck Protection Program (PPP), and on the other hand, they are working twice as hard to cope with the increasing workload and adapting their business models to the new normal. 

For many accountants, collections and managing cash flows are the top priorities now. Usually, CPA firms have a 30 to 90 day payment window for AR collections. However, with many businesses being closed for the past three months, the invoice clearance period got extended to 60 or even 90-days in some cases. The delays in AR collections are a huge concern because they adversely impact every aspect of the business.

Challenges with the existing AR collection process

The accounts receivables show the amount of money that an accounting firm has earned for offering accounting services. A decent accounts receivable turnover ratio is a positive sign for any accounting firm, however too many pending invoices are not acceptable.

Often, poor AR collection processes will have ripple effects  on CPA firms. From short-term cash flow issues  to defaulting clients, improper allocations and payments, poor AR collection processes adversely impact every aspect of your business and result in heavy loss of time, money, and efficiency.

 Automatic invoice collection or the Task-to-Cash collection process

Automating the AR collection process will relieve you from nasty follow ups and tiring payments cycles.

The integrated Task-to-cash process is an automated AR collection process that makes payment collection an integral part of your task workflow eliminating the need for 3rd party invoicing software or collection agencies.

For example, let’s consider the manual invoicing process for corporate filings. A typical corporate filings workflow includes a number of tasks from sourcing to company formation. Once the filing activity is completed, accountants invoice the client for their services along with reimbursements.

However, in the task to cash collection process, a new task called “Pay Me” will be included in the workflow. Once the company is incorporated, accountants can mark the activity as “Pay Me”. Once the status of the task is changed to Pay Me, the software automatically sends emails and application notifications to the client informing them about the task completion along with a copy of the invoice. The application continues to send email reminders at regular intervals till the invoice gets paid. A secured digital payment link will be included in the email reminders to make the payment process easier and faster.

Accountants also have the option to enter the time taken or the number of billed hours in the task description. In case of hourly billing, the application will invoice the client for the hours clocked in by the accountant.

Once a client clears an invoice, the application will notify the accountant about the payment, mark the task as completed and archive all the related documents.

Advantages of the Task-to-Cash collection process

Improved collection efficiency

By adopting the task-to-cash collection process, the collection efficiency of your firm improves drastically. Invoices will be cleared faster and because the system does not mark the task as completed without the invoice getting paid. The payment process is not only fast, but also highly simple and straightforward. 

Enhanced staff productivity and Efficiency

Developing an automated collection process relieves your staff from mundane follow ups and collection activities and helps them to focus on revenue generating activities and on adding more value to your clients.

Delayed payments are only the tip of the iceberg. The manual AR collection process involves many time consuming and tedious activities like tracking aging invoices, following up with clients, and sending repeated “gentle” reminder emails.

The best part of a practice management software with integrated collections is that you do not have to go through all the frustration involved in collections. The software does all the heavy lifting for you, improving the efficiency of and productivity of your business.

Reduced cost of collections

Your practice management software relieves all your accounts receivable collection woos. A practice management software with the task-to-cash collection features means that you no longer need expensive third party software or collection agencies to get what you are due.

Better cash flow

With the integrated task to cash process, cash flow concerns will only be a thing of the past. The software gives you detailed and timely insights on the cash flow of your business along with other details such as aging of invoices and revenues at a task level. You can leverage the cash flow information for taking better decisions on business expansions, hiring, and other long-term and short-term investments. 

Enhanced customer collaboration and relations 

Practice management solutions offer a number of collaboration tools. Contextual messaging features allow you to communicate and collaborate with clients at a task level. Now you can add a context to all your interactions such that not even a minute detail related to the project goes unnoticed. 

Advanced document management and sharing facilities allow you to safely share documents with clients eliminating the need for multiple emails or calls. Dedicated client portals integrated with your practice management software not only improve your teams productivity and efficiency but also give an enhanced customer experience for your clients.

Your customers will be happy to pay on time because even they can avoid late payment fees and other costs. Automating AR collections helps in creating a reliable, safe, and secure payment ecosystem for your business. In short, faster payments ensure lesser invoicing disputes, quality client service, and happy customers.

Reduced collection costs & optimum use of resources

Manual AR collection processes are long and cumbersome and consume a lot of resources. On the other hand, automation not only improves the AR collection process but also eliminates other costs, like printing and mailing documents, incurred while handling physical documents. Digital invoicing helps in standardizing your business processes and building paperless firms. 

Comprehensive Insights and advanced analytics

Extended credit causes a lot of frustration for accountants. Managers are constantly involved in risk calculations, cash flow predictions, and nasty communications and follow ups. Automation helps you to eliminate collection risks from your business. 

Automated AR collection systems help you manage your business effectively and efficiently. Because the collection happens at a task level, practice management solutions gather even the most minute details about your businesses. Accountants can leverage the data collection while processing the tasks for gaining a better understanding of their business. Advanced credit reports generated by the software will help you to identify anomalies way ahead in the workflow and take corrective action.

Advanced insights and dashboards provide a 360° view of your business helping you to be in complete control.

Schedule a demo now, to see Qount’s task to cash feature live in action.