Is Your Accounts Payable Work Overwhelming?Let A Service Provider help

Accounts payable (AP) teams play a crucial role in the management of financial operations, but their daily workload is often underestimated. In fact, many AP teams struggle with outdated manual processes, fragmented systems, and time-consuming workflows, all of which make it difficult to keep up with invoice processing, approvals, and reporting. Instead of trying to solve these inefficiencies internally, outsourcing AP functions can help investment managers significantly improve efficiency, accuracy, and compliance.

Five Common Challenges AP Teams Face

Outside the AP team, it may be difficult to understand the scope of issues these professionals face every day. Here are five of the most prominent:

1. High Invoice Volume

Every month, AP teams receive a steady influx of invoices, with surges during peak business cycles. The first step in the process involves sorting and classifying these invoices to ensure smooth processing. This is where the problems start. Requesting invoices internally, managing communication, and identifying supporting documentation can take hours, if not a whole day of the team’s time. In fact, this step alone requires teams to:

• Open, sort, and categorize physical and electronic invoices
• Identify duplicate invoices and flag errors before processing
• Verify the presence of all necessary supporting documentation
• Accurately record invoices in ERP systems or spreadsheets
• Manage communication with vendors and internal stakeholders

Without a structured system, these manual processes lead to inefficiencies, increasing the risk of delays, misplaced invoices, and payment errors.

2. Complex Approval Workflows

Once invoices are received and recorded, they must be sent to the appropriate stakeholders for verification and approval. This step involves:

• Differentiating invoices as PO-based or non-PO-based
• Identifying the correct approval levels according to company policies
• Assigning invoice codes and ensuring accurate tagging
• Physically delivering paper invoices or electronically routing digital invoices
• Storing invoices securely in a centralized location for easy access

In organizations with multiple approval layers, invoices often get stuck in email inboxes, requiring repeated follow-ups and causing significant processing delays.

3. Repetitive Follow-Ups and Processing Delays

After invoices are distributed for approval, AP teams spend a considerable amount of time chasing approvals and troubleshooting issues. Responsibilities include:

• Continuously checking in with approvers to expedite approvals
• Resending requests and following up on pending signatures
• Resolving delays caused by missing information, out-of-office approvers, or other system inefficiencies
• Updating invoice status manually in ERP systems or spreadsheets
• Matching invoices with POs and supporting documents for validation
• Responding to vendor inquiries regarding payment status and expected timelines

These tasks consume valuable time and resources, limiting the AP team’s ability to focus on strategic improvements and efficiency enhancements.

4. Month-End Close and Financial Reporting

As the end of a financial period approaches, AP teams must juggle all of these invoice processing tasks simultaneously with month-end reconciliation, financial reporting, and payment runs. These activities include:

• Executing payment runs and ensuring compliance with approval policies
• Reconciling processed invoices with company financial records
• Generating reports for leadership and finance teams
• Addressing outstanding invoice discrepancies before closing the books

This period is typically very hectic, as AP teams must give priority to urgent transactions while also ensuring accuracy in financial reporting—often at the expense of process improvements.

5. Balancing Leadership, Training, and Process Optimization

AP team managers are responsible for addressing internal bottlenecks, resolving vendor disputes, and ensuring overall efficiency. However, with high rates of staff turnover and constant workload pressure, managers also need to:

• Train and onboard new AP team members
• Identify inefficiencies and implement process enhancements
• Manage relationships with vendors and internal departments
• Maintain compliance with financial regulations and audit requirements

Limited time and resources make it challenging to focus on long-term process improvements, which means ongoing inefficiencies and workflow disruptions remain unresolved.

The Benefits of Accounts Payable Outsourcing

Given the complexity and volume of AP tasks, it’s obvious why so many organizations struggle to maintain efficiency and accuracy. This is where outsourcing AP services can make a significant difference. For example, by outsourcing AP functions to IVP Accounts Payable Services, investment managers can benefit from:

• End-to-end AP management: Coverage includes everything from invoice capture and validation to approvals, allocations, and vendor communication.
• Reduced internal workload: Free up teams from time-consuming AP tasks to focus on strategic financial initiatives.
• Increased Accuracy: Ensure accuracy by validating invoices against vendors, contracts, and automated entries.
• Seamless expense allocation: Identify, determine, and apply allocation logic while securing necessary approvals.
• Enhanced compliance: Maintain transparency and adherence to financial policies and vendor agreements.
• Real-time reporting: Track payables, receivables, and unpaid invoices for more complete financial oversight.
• Scalability and efficiency: Optimize AP operations with expert support designed for business growth.

With IVP Accounts Payable Services, investment managers gain access to:

• Dedicated team of AP experts who manage invoice processing from start to finish
• Streamlined workflow that eliminates inefficiencies and reduces errors
• Seamless integration with existing financial systems to ensure transparency and compliance
• Secure, scalable, and efficient AP operations designed for growth

By outsourcing AP functions, companies can offload the most time-consuming tasks, reduce the risk of costly mistakes, and free up internal teams to focus on strategic financial initiatives. With expert support, investment managers can enhance operational efficiency, improve compliance, and achieve greater cost savings—allowing AP teams to play a more impactful role in overall financial management.