Quickbooks automation? You can do better.

Business-process automation reduces errors and improves accuracy. More accuracy helps cut costs and saves time. Business-process automation in QuickBooks is a struggle, according to former users of this bookkeeping tool.

A single connected system that integrates easily with other cloud-based systems helps eliminate time-consuming manual processes and takes full advantage of the connectivity and digital features of today’s smart devices and applications. Introducing automated digital processes for functions such as timesheets, expense claims and billing can quickly improve efficiency, enhance accuracy, cut costs and prevent revenue leakage.  As well, integration with other business applications and business partners allows for the bidirectional sharing of information, so you can better manage your supply chain and transactions with trading partners.

Missing Automation in QuickBooks Slows Down Closing the Books

Manual processes in QuickBooks make for long closes. QuickBooks is designed for companies that need simple bookkeeping and have a single entity. Even with just one business entity, QuickBooks users end up wasting time investigating anomalies and exceptions, performing manual reallocations and reconciling bank statements.

As well, QuickBooks can’t give you a single view of shared accounts, customers and vendors across entities. Instead, the finance team is forced to jump from once instance of QuickBooks to another. They manually track areas such as intercompany eliminations, revenue recognition, and allocations and accruals for expenses. Unsurprisingly, this invites errors and leads to even more time spent making corrections. For companies with multiple entities, this lack of automation also makes it impossible to connect with other platforms and trading partners.

If you’re using QuickBooks, you’re doing the following manual tasks to close:

• Consolidations
• Currency conversions
• Intercompany eliminations
• Revenue recognition
• Allocations and accruals for expenses
• Depreciations
• Amortizations
• Adjustments

Business success depends on the ability to see what’s happening in all areas of the business, especially if the operations or market conditions are changing rapidly. Business leaders need a holistic view of everything from bookings to available capacity to inventory levels and, of course, financial metrics. But business leaders can’t make informed, timely decisions if it takes weeks to assemble, present and analyze that data. Manual processes in QuickBooks choke the ability to share real-time financial data so leaders in the organization can make strategic data-driven decisions.

Missing Automation in QuickBooks Slows Down AP

Accounts payable is a relatively straight-forward process. An invoice is received, checked to ensure it’s legitimate and the bill is accurate, perhaps using two- or three-way match, then routed for approvals and payment. The invoice is then marked as paid and archived should it need to be retrieved.

With QuickBooks, invoice capture is a manual process using bill creation. QuickBooks organizes the data so users can see which vendors have been paid, the vendor detail and to pull an AP aging report. But what it doesn’t do is automate the process from the time the invoice comes in until the invoice is archived.

Even though the invoice data is entered in QuickBooks, the invoice is manually routed for verification and payment, either via email or on paper. The biggest challenges are data entry, invoice-to-payment matching, and solving for lost and duplicate invoices.

When the process is automated, invoice approval is faster, there are fewer errors and productivity increases.

Automating the process also cuts costs. Depending on which report you’d like to believe, the average all-in cost of processing a single invoice is $15. That drops to around $2 when you automate the process.

AP is one of the many processes where QuickBooks falls short on automation. It’s a nice place to view invoices, sales orders, payroll records and the like, but it doesn’t work for a growing company, especially when you want to link the financials to other business applications. No matter how you slice it, manual processes are error-prone and time-consuming, and it makes it difficult to gain an integrated, real-time financial view of a company’s end-to-end processes.

Missing Automation in QuickBooks Hinders Application Integration

Let’s turn to application integration, which is one of the ways you can improve business-process automation. Application integration facilitates the running of individual applications with other applications. Merging and optimizing data and workflows between multiple software modernizes systems and supports agile business operations. This reduces costs, reveals insights and creates greater efficiencies and capabilities as compared with using independent applications.

Many businesses run core financial and enterprise resource planning software originally developed more than a decade ago for the desktop or data center. Some of these are retrofitted for the cloud, but can’t take full advantage of the scalability, adaptability and robustness of cloud-native architectures. QuickBooks is a perfect example of this, and the online version of QuickBooks delivers significantly less functionality than the desktop version.

If you’re running on-premises or retrofitted online software, it’s worth noting that a lot has changed in the business world.

• Most retail organizations and business-to-business suppliers have adopted e-commerce transactions, requiring significant enhancements to their line-of-business systems to capture and process orders, manage inventory, track shipments, handle returns and protect against fraud and cybercrime.
• The “as-a-service” business model is growing faster than the linear business model. Companies that never anticipated renting their products and services are now transitioning to subscription and usage-based pricing. This has massive implications on functions that include accounting, billing, salesforce compensation and financial reporting. Few legacy application developers anticipated such sweeping changes to business models. Certainly not QuickBooks.
• Customers increasingly want to interact with businesses via website or mobile apps with self-service. Older applications weren’t designed for direct use by customers. Intuitive interfaces, lightning-fast response times and hardened security are table stakes for today’s customers.
• Data analytics increasingly govern rapid decision-making, requiring businesses to shift from batch to real-time processing and to make it simple to share data between transactional and analytical applications.
• New privacy protection regulations require more stringent approaches to data governance, protection and reporting. The General Data Protection Regulation and the California Consumer Privacy Act are two examples, as are the pending federal American Data Privacy and Protection Act and another 29 pending pieces of state legislation in the US.

With these changes in mind, it’s more important than ever for companies to integrate their core business applications, lest they are surpassed by competitors and abandoned by their markets.

Outgrowing QuickBooks Automation

What are some of the signs you’ve outgrown QuickBooks automation?

• You have multiple entities. With QuickBooks, each entity requires its own instance of QuickBooks, so there is no chance that you can streamline business process to improve productivity, especially if you have three or more entities. Recently, I spoke with a former QuickBooks user in a company with 80 entities, and she told me she spent 20% of her day just logging in and out of QuickBooks.
• Your chart of accounts is growing.   As you add new accounts, there are workflows associated with each, and QuickBooks will not let you automate these.
• You’re finding errors and spending a lot of time correcting these, or worse, these errors went undiscovered for a while and ended up being major problems.
• Your team spends a week or more on each purchase order approval or invoice.
• You’re spending too much time printing, signing, mailing and reconciling checks to vendors, or you’re processing more than 200 invoices per month.
• Your bank reconciliations are so tedious and time-consuming that you only do them once a month, and you go weeks without knowing your cash position.

If your organization faces complexities such as decentralized payables, inter-entity transactions, multiple currencies, and global consolidations, it’s time to look at a different solution. Eliminating manual effort can help you close the books 25% – 70% faster and concentrate on growth.  Look for a cloud-native platform that can provide the following:

• Faster closes with multiple-entity consolidations
  • Journaled consolidations for granular visibility with eliminations and currency impacts so you can easily make post-consolidation adjustments
  • Automated intercompany eliminations at the point of consolidation
  • Real-time reporting to view interim summary figures at any time
• Currency conversions
  • Accurate, automated exchange rates for currency conversions and revaluations that stay up-to-date, even as rates change, and automatically balance your inter-entity transaction entries across entities with multiple base currencies
  • ASC 830/FAS-52 compliance with creating cumulative translation adjustments
• Set up and maintenance for additional entities
  • Set up new entities with configurable rules for inter-entity transactions, bank accounts, etc.
  • Flexible definitions so new entities inherit your existing lists, process definitions, and charts of accounts, or configure new entities with unique definitions

Some Final Thoughts on Automation

You can replace manual processes with automation to:

• Increase operational efficiency
• Improve document organization
• Permit multi-user access, from anywhere, at any time
• Interface with vendors
• Define and automate key financial processes
• Improve security with role-based access & audit trails
• Gain real-time visibility
• Easily slice and dice the data
• Speed up entity/location consolidations
• Automate calculation of performance metrics
• View performance and outcomes across systems through integration

That said, automation isn’t something you just turn on. You have to look at your processes today and map out how these work, then see if there are any areas for improvement. If there’s a step in a manual process that’s causing a bottleneck, replicating that step in an automated process may not solve the problem. And just because you can automate something doesn’t always mean that you should. A broken process automated creates automation that simply fails faster.

Business-process automation is an essential part of business enablement and digital transformation.  Fit-to-purpose automated workflows, coupled with real-time business analytics and seamless integration across systems, locations and entities are critical to business success.