How your school can use automation and best practices to secure your Accounts Receivable and Payable functions
Is your Accounts team feeling snowed under from all the tasks required to manage Accounts Payable (AP) and Accounts Receivable (AR)? From invoicing to updating financial details, reconciling accounts to reporting, dozens of manual tasks are likely keeping your team working around the clock to keep cash flowing and relationships managed.
It’s little wonder that within this complex business function, tiny mistakes and small oversights can leave your accounts vulnerable to security and fraud risks — both internally and externally. At Cole School Experts, we’ve supported a number of schools that have experienced security breaches and needed to shore up their financial processes — fast.
Our secret weapons? Automation and leveraging best practices.
We’ve found that by introducing these two components into their processes, schools can significantly scale up the security and efficiency of their AP and AR functions. Today, we’re going to give you a behind-the-scenes look at methods for protecting your accounts using the power of automation and best practice guidelines. Let’s dive in.
Set up automation within your AR and AP functions
Automation can significantly streamline your AR and AP functions in a number of ways. Your team will need to create a set of templates and ‘rules’ that will form the basis of your automation strategy. The goal? To reduce manual errors, speed up processes and ensure consistency.
At Cole School Experts, we’ve supported schools to leverage automation across a number of areas, including:
- Invoicing — creating and distributing invoices electronically at set times throughout the year.
- Payment reminders — sending automated reminders for overdue payments, which escalate based on predefined conditions.
- Payment processing — automatically matching incoming payments with existing purchase orders and receipts.
- Automatic batching — set up rules to group similar transactions together, saving time and reducing input errors.
- Systems and software — sending and matching data from your different systems via API and integrations, so every database is kept up to date and compliant.
Create a ‘best practice playbook’ for your Accounts team
When everyone in your Accounts team learns and follows a set of best practice guidelines, you’ll find that protecting your AP function becomes a lot easier. We recommend creating a playbook with all processes, guidelines and expectations that can be easily accessed by anyone in the team. It’s essential that the overarching function of the playbook is risk and compliance management, so every process must be created with this priority. To ensure it’s followed, you’ll need to continue communicating the importance of following the playbook, as well as continuously updating it as your business needs evolve.
Protecting your Accounts Payable function
Here are some considerations for your best practice playbook, to ensure you’re properly protecting your AP:
- Multi-factor authentication (MFA) — ensuring MFA is set up across every system for every login, to keep confidential school data secure.
- Segregation of duties (SoD) — putting a plan in place that divides up critical functions amongst different members of the team and creates new job descriptions. This provides appropriate checks and balances and protects against loss of knowledge.
- Vendor verification — protecting your supply chain by checking the credentials (using companies like EFTsure) of every contractor, supplier or service provider before engaging them.
- Monitoring and reporting — setting up regular AP reports to ensure outgoing payments to suppliers and vendors are managed efficiently, avoiding late fees.
- Training — outlining the training responsibilities of each team member to keep their knowledge up to date and aware of improved processes and controls.
- Regular audits — outlining the internal and external auditing requirements of your finance function to pick up on inaccuracies, risks and fraud.
Protecting your Accounts Receivable function
Here are some considerations to include in your playbook, to ensure you’re properly protecting your AR:
- Data encryption — safeguard sensitive financial information by deploying encryption technology.
- Access control — assign permissions based on the roles and responsibilities of users within your team, granting each person access only to the specific data necessary to perform their job.
- Fraud detection — create processes and checks, and set up technology to protect against fraudulent activities.
- Real-time reporting — provide team members with instant access to up-to-date financial data so they can gain immediate insights and facilitate timely decision-making.
- Regular updates — enhance your team’s agility, responsiveness and ability to manage financial resources by setting up regular financial metric tracking and dashboards.
Wrapping it up: how your team can start securing your financial frontline today
Managing your AP and AR can be overwhelming. At Cole School Experts, we’ve seen firsthand the impact of security breaches on schools like yours, which has prompted us to develop practical strategies using automation and best practices.
If you’re ready to start putting these ‘secret weapons’ to work, but you’re unsure where to start, we can help. Call in Cole School Experts to help you develop a playbook of your own, including processes and requirements that will keep your financial function safe and your team empowered.
