As experienced back office accounting professionals who work with thousands of businesses, we have highlighted the top 5 automation features that your business needs. Check out the list below.  

1. Accounts Payable Workflow Technology 

Electronic data workflows simplify the AP processes, eliminate ambiguity, boost productivity, reduce waste, and provide you with more control over the method. Therefore, if you have already digitized your AP, using end-to-end workflow technology is the ideal approach to pick it up a notch.  

2. Electronic/Digital Document Management System 

A manual accounts payable system's main problem is physical records of purchase agreements or bills that get lost along the way. In AP, important documents frequently manage to disappear when they are most required. 

All of these issues can be resolved by implementing a central filing system, which offers consolidated platforms for data and record recovery at the precise moment you require them. To minimize a cost burden, make sure your AP automation software has the appropriate document management system. 

3. Intuitive Character Recognition Tools 

The ability to use dashboards, workflow technology, and digital document solutions depends on how well the documents have been digitized. Consider using OCR technologies to scan the records if you haven't yet made the switch from manual processing. 

An OCR program effectively recognizes the content from the scanned image or picture when supplied with handwritten or physical documents to transform them into PDF files. In this manner, the groundwork for digitization can be laid, saving hours of laborious manual labor in front of a computer. Imagine trying to back up and digitize thousands of pages of important documents. That can be a logistical nightmare. It is better to use OCR to do the work for you.  

4. Accounts Payable Dashboards 

The dashboards provide the most transparency, even though the workflow can be configured with an automated alert to guarantee that the correct invoice reaches the correct person. 

Dashboards provide a high-level, clear picture of payment and invoice processing to provide easy access to the status. Unlike in the past, when employees had to regularly bounce back and forth to learn that an invoice was stalled in processing, AP experts, managers, and accountants now have the necessary data at their disposal. To provide frictionless reporting and effective tracking to prevent obstacles, it is essential to have a strong dashboard in place.  

Small Business data report says that more than 50% of small businesses across the world are open to financial fraud due to their faulty AP systems. To avoid such severe financial horrors, make sure your system has a simple yet efficient dashboard. 

5. Payment Optimization  

For some firms that do not provide a variety of payment methods or do not use automation, transactions are a pain point for them. Payment optimization tools that analyze and deliver relevant insights for optimized payments and savings can benefit greatly from the extensive payment history of a business. Companies can even get paid for fulfilling their obligations and utilizing virtual credit systems with the proper payment optimization.  

Businesses can also take advantage of recurring payments with their automated AP system. The same payment to the same vendor or employee that goes out every month can be completely automated and save you a lot of time.  

1. Create a business bank account 

If you do not set up a separate business account, there is a high chance that you will find it very hard to close your books at month and year-end. Why? You will have to go through all your expenses individually to know which is a personal and business transaction. 

To avoid such situations, create a separate business account so that all expenses are directly accounted for, and you get instant updates about them. Month-end bookkeeping and accounts reconciliation work also become easy for your whole team.  

Along with this, you must also get dedicated business credit and debit cards. This helps the business get a line of credit scores along with all the transactions you make. Why do you need it? This will create a solid ground for you in the future when you want to get financial investments and credit from outside sources to grow your business.  

2. Choose between cash and accrual accounting 

According to GAAP standards, businesses which have annual turnovers of more than $5 million need to follow accrual accounting methods. The rest of the companies with below $5 million annual turnover can also follow cash methods. Both have their own sets of advantages and disadvantages, so if you are confused about which one is better, ask your accountant.  

If you do not have an in-house accountant, you can go for outsourced accounting services and get a consultation from experts at much cheaper rates. After you finalize an accounting method, start accounting for all your transactions and register and log them into a centralized office system. You should preferably also back up these data in a cloud-based backup system to ensure no transaction records and history is lost in transition.  

3. Choose a to automate back office accounting  

The back office accounting software industry is growing leaps and bounds and automating most of the repetitive and tedious work in accounting. Things like verifying invoices, sending payment requests, generating invoices, verifying transactions, and categorizing them can all be automated with the right software. 

But every industry has its own set of software options for back office accounting work, so before you choose, make sure you do a thorough background check. Since it provides a great level of automation, even many experienced accountants are also using a selection of technology to help in their work. A Sage survey and market research found that more than 58% of American accountants feel that their efficiency and productivity increased after they started software usage.  

4. Categorize all expenses 

When you are running a business, you must learn to categorize your expenses to help manage them better. You can categorize them by date, time, departments, expense type, etc. So, when there are any issues with any transactions, you can get quick updates on it if you look by category. You can ask the respective departments to get back to you and save the rest of the employees the extra hassle.  

No matter how good your listings are, keeping your business profitable in the long run can become very hard if your finances are all over the place. So, here are some insider tips for managing your small real estate business finances a little better and getting a grasp on your cash flow.  

1. Make a detailed budget and stick to it 

Clutch survey has found that more than 50% of small businesses do not have any official budget for their company. This creates a major KPI void in the company because you lack the yardstick to measure your progress and growth. It will also help you identify unnecessary spending and help you revise your property prices if need be.  

Creating a budget for your real estate business also helps all employees and your business transactions to stay within limits and overspend. You can revise your budgets regularly, but creating a concrete budget at the beginning of every financial year is crucial, to begin with.  

2. Obtain a line of credit 

There are a lot of short-term credit and cash flow issues in businesses, like payroll, sustaining inventory, paying vendors, and conducting immediate maintenance. Securing a line of credit might be the best option to handle such immediate issues. But to work properly without you going into a lot of debt, you need to plan your finances well and not overspend more than absolutely required.  

Though businesses have a lot of stigma about taking credit or loans, statistics say that more than 29% of small businesses fail when they run out of capital. It is better to take a small credit than completely go out of business.  

3. Separate your business and personal accounts 

When a business has just started out, mixing up its personal and business expenses is one of the biggest mistakes people commit. Though setting up a corporate business account might seem like a hassle, your taxes and expenses can all get haywire without one.  

This will help lower your challenges of keeping track of money that your received or paid on your company’s behalf. This will ensure that all business transactions are accounted for and will help reduce the chances of internal fraud in the company.  

4. Optimize your payroll process 

Payroll is one thing that recurs every month and is unavoidable in running any successful business. It is better to take this load off your mind and integrate payroll automation software to streamline the process. The right technology selection in payroll management can help you optimize your financial resources and reduce your work.  

5. Improve inventory management and analysis  

Real estate inventory forms the core base of your business, and managing that can become difficult, especially if your portfolio of properties is spread all across the city/state/country. That is why you should use a property selection of technology in project management to automate the inventory management process. Integrate CRM software to keep track of inventory in real-time to reduce loss of money. 

You will get instant updates about property sales, vacant properties, or tenant turnovers and can plan your next steps accordingly without wasting any time.  

6. Opt for automated accounting software 

Managing your real estate business's back office accounting work is a major part of working on your finances and staying in control. Hiring full-time accounting help can be too costly for small businesses, but property management software like Yardi can easily automate the process. 

Things like transaction tracking, fraud detection, and financial data analysis can all be done on this software. Use this selection of technology to free up your vital time so you can focus on other important matters of business.  

7. Start an automated billing and payment method 

Another way to always have your cash flowing and stabilize your finances is to automate your billing and payment collection methods. Even if your employees forget to send out bills on time, the right software will always send automated bills and reminders to all tenants/vendors. This will ensure that payments come on time, and you do not have to spend extra time running around to get your money rolling.  

From rent collection to vendor payments, all of these transactions can be automated and speed up your cash flow management process.  

8. Make financial investments to grow money 

You need to plan your strategy and leadership in a way that you can make smarter choices in investment. Many PropTech trends and high-yielding real estate markets can get you better financial returns. So, study the market and make financial investments to grow your money on all fronts.  

Before we learn the types of journal entries, let us figure out what are the common things that every journal entry should have, 

• An entry type, date, time, recipient/sender name 

• A reference or unique identification number 

• Which are the accounts that will be affected by the debit/credit amount, and a mention of those accounts 

• A short description of the transaction - you might refer back to this in the future, so make it concise yet informative at the same time.  

1. Simple entries 

Simple entries are one of the easiest; only two accounts are affected in this transaction, one debit account and one credit account. There are no other extra details in this one.  

2. Compound entries 

Compound entries are the ones which have at least two or more debit and credit items/transactions. These transactions are generally entered in one single day, and similar transactions are clubbed together to uncomplicate the process. Wall Street Mojo reports say that this process improves productivity and simplifies work for the back office accounting team.  

3. Opening entries 

Opening record the balance of assets and liabilities of any company. They carry forward the ending balance from the previous month/week/quarter/year to the next accounting period. The ending balance in the last period becomes the opening entry of the next accounting period. These types of entries work as a KPI to help track the in-hand cash of any company and paints a clear picture of the financial health.  

4. Closing entries 

Closing entries are one of the most vital, marking the end of a financial period. The company’s balance amount can then be transferred from a temporary accounting to a permanent accounting marking the profit, loss or the overall financial condition of the company. This helps the balance of the temporary account be reset to zero to mark the beginning of a new financial period.  

5. Transfer entries 

Transfer entries are the ones when a certain amount of funds is moved from one accounting to the other, like the main account to a subsidiary. The credit and the debit amount is always the same in these entries. No third parties are mentioned in these transactions, and the net value must be zero at the end of the process. Keeping these records will help you catch and keep track of internal frauds, and even small internal transactions will be accounted for.  

6. Adjustment entries 

Adjustment entries are special entries that are not otherwise accounted for in journals. These record any special changes in accounts within a certain accounting period. These entries help companies to avoid any discrepancies and missed entries. These entries are generally entered in the general ledger at the end of a specific time period.  

This type of accounting entry converts a particular entity’s accounting record into the accrual basis of accounting to keep up with all compliances.  

7. Rectifying entries 

Rectifying journal entries are exactly what they sound like; they are amendment entries. They are passed on to make corrections in the original books or a particular account in the ledger. This also helps restore the effect of the original credit and debit amount, clearing any mismatched entries along the way.  

8. Reversing entries 

An outsourced accounting partner who works on a plan to help in your growth is hard to find. But you can start the journey by asking these questions to your shortlisted partners before onboarding to get a better understanding of their work. 

• If they are familiar with the accounting needs of that particular industry? 

All businesses and industries have accounting needs, but no two industries function the same way. Before you onboard an outsourced accounting partner, you need to ensure they know and have enough experience working with similar businesses in your industry.  

• How many years of experience do they have in accounting? 

Employing, training and paying an in-house team of expert accounting staff is costly. If you opt for outsourced accounting services, you must ensure that you do not compromise on the staff working for you. Specifically, ask the firm you are working with about how many years of experience they have in handling back office accounting work. 

• Do the outsourced accounting partners have the proper qualifications? 

Get proper certifications from your outsourced accounting partner on their real qualifications in this sector. Outsourcing the work aims to get experienced and qualified workers at a lower cost, so ensure that before onboarding.  

• What technology will they use to streamline your accounting work? 

There are multiple different back office accounting software available in the market. When you outsource your work to someone, they should use the latest technology to give your business a competitive edge in the market. Software like Yardi can simplify the accounting work for your company. Make sure you get the best technology selection in your office work when selecting an outsourcing partner. 

• What is the work delivery time of this partner? 

A quick turnaround time is a must when it comes to an outsourced accounting partner. If they take time to deliver on work then it is a redundant investment. Time-consuming back office accounting work can be done by inexperienced in-house staff. You shift to outsourcing to get work delivered on time and keep up with all legal and financial compliances.  

• What is their total cost of outsourcing? 

When you think about outsourcing your work, you save up on labor and money. So take a total cost idea of outsourcing from the relevant partner, compare it with your in-house working expenditure, and make a comparative study on which is more effective.  

• What is their cyber security protocol for your financial data? 

Back office accounting for any firm deals with a lot of crucial and sensitive financial data; you must ask your back office accounting partner about the kind of cyber security protocols they use to secure your data. Any breaches in their system will affect your business, finances, and customer relations. 

• Ask to see some reviews by previous clients to ensure authenticity 

If you are teaming up with some experienced outsourced accounting services provider, they will have gathered some customer reviews by then. Ask to see those or the past work they have done to check through their authenticity and do a background check on their work credibility.  

Outsourcing the back office accounting work reduces the pressure on your finances for an extra yearly payroll. Here are some of the highlighted benefits of getting outsourced accounting services. 

• Better control at lower costs 

Outsourced accounting partners use cloud-based solutions to do your work. The data they derive can be accessed by you and used in real-time at any point in time. These services can be paid for when you use them and not as full-time employees helping you cut down on costs. 

• Trustworthy data from expert resources 

Big financial data is crucial to help in the budgeting and forecasting for any company. When your outsourced partner provides you with industry experts to work on your accounts, they will help you find useful data to analyze and work with.  

• Scaling core work with the latest tech usage 

Take a look at the dynamic and diverse benefits of using AI in your AP system to make back office work hassle-free and devoid of errors. Read on to know more. 

• Automation plans 

There are multiple daily tasks that your Accounts Payable team handles on a daily basis. These tasks are repetitive yet need high levels of accuracy. Things like invoice filing and retrieval, data entry, invoice routing, and much more can become automated with the use of AI. You can also add Machine Learning to this, and you will get data identification and extraction work done in minutes. It also helps you understand and categorize the data based on the findings and conclusions, making your life easier.  

This will help completely digitalize your accounting system and eventually make future data search much easier. This is exactly why more than 58% of expert accountants want to start investing in AI-based automation services to upgrade their businesses.  

• In-depth data analysis 

When your Accounts Payable system uses AI to process data, you can also use the findings for better accounting budgeting and forecasting. It will tally future revenue and upcoming expenses to help you understand your cash flow and expenditure abilities. AI will give you balance sheet forecasts to help better your future financial plans. Survey says that more than 51% of accountants believe that processing and analyzing data findings of AI automated systems will become the next big thing in coming years. Find that intriguing? That is exactly why you need to start investing in AI-based accounting automation plans. 

• Follow up on all compliances and regulations  

Analyzing big bulks of data to keep up with all compliances and regulations can be a back-breaking task. Even the smallest of human errors can become major setbacks during audits. The use of AI can simply process all these complex data to find all discrepancies. From flagging problem areas and high-risk documents, AI can be trained to do all of it. You will be further saved from all future legal and audit issues by keeping all documents in order.  

• Reduced errors and costs 

More than 80% of business executives believe that the use of AI in accounting gives them get better efficiency. From the loss of invoices to double payments, humans can end up making many small errors that can cost your business millions of dollars. These errors can be easily avoided with the use of an AI-based AP system. From cutting down costs on physical invoices to avoiding extra payments, AI can benefit you in multiple avenues and cut down on unnecessary expenditure.  

• Fraud detection  

Assetsoft helps you choose the right property management software for your business - taking into consideration the features you are looking for. We can help you: 

• Streamline all business resources for better productivity 

• Manage properties and leases including move-in, movie-outs and work order management 

• Rent collection and vendor payments made easy 

• Create robots to automate all mundane tasks 

• Provide a financial overview and valuable insights on how to increase profits 

• Track projects for on-time completion 

• Easy lease renewals and account insights 

• Integration with marketing tools 

• Budgeting, forecasting and CAM reconciliations  

• Secure data over the cloud