Capitalizing Accounts Receivable Management

Accounts receivable refers to the payments that are not yet cleared by the clients or it is also used to give a long-term credit to customers/clients. It helps in gaining customer loyalty and allowing them to take product/services on credit basis that helps in boosting sales. Here accounts receivable management plays a crucial role, as this is the responsibility of management to track the history of customer and recover payments on time. Watch this video about benefits and importance of accounts receivable management.

Switch to Cloud Accounting for your Restaurant Business

Restaurant industry has evolved into a form where a vast amount of data flows through the system. Data that simply cannot be managed the traditional way without compromising efficiency. Utmost efficiency is the goal of every restaurant business and taking advantage of modern techniques is the way to achieving the goal.

Each different facet of accounting that a company has to take care of, namely payroll, tax, accounts payable, accounts receivable and other financial operations, requires communication of data which may be stored in different locations. This dispersed storage can cause slowdowns and inaccuracies which lead to errors in accounting. Enter cloud accounting for restaurants. Forget all the woes of having to grab financial information from different storage units. Cloud Accounting allows for all accounting data to be stored in a remotely accessible location. Data being accessible remotely severely cuts down time wastage as data wouldn't have to travel through numerous locations. 

There are plenty of other perks of using cloud accounting, let us have a look at a few:

It Helps Cut Down Costs

Manual management of vendor payments and payroll is a significant time and money sink and is also vulnerable to errors. The more locations through which invoices in your system have to travel, the longer the process will take. Cloud accounting for restaurants will allow you to save more than 33% time by eliminating the locations and reducing the risk of errors. You'll save money when you're not going to have to spend on postage, printers and other supplies. You'll also be able to keep a better track of due dates. An automated system can allow you to function with fewer employees as well since it would be more efficient, hence you'll be saving money on staff expenses.

It Provides Real-Time Financial Statistics

Imagine how much more you'll be able to improve your restaurant business if you got your key financial statistics daily. Certain cloud-based systems come with features that can do so. They can combine financial and operational statistics which you can view on a dashboard. These statistics, if delayed, can become irrelevant to you. Hence, a correctly set up cloud-based accounting system which will allow you access to those statistics daily would be ideal in helping you manage your restaurant.

Builds Synergy

With a cloud-based system, it becomes significantly easier to communicate financial information with different units within your organization or entities outside your organization over a traditional accounting system. A cloud-based system allows remote access to financial information through compatible 'smart' devices such as smartphones, iPads, and laptops. It also allows you to manage vendor documents easily and take care of any related required actions promptly.

Eliminates Embezzlement

Traditional accounting systems are riddled with loopholes and inefficiencies that allow for much easier fraudulent actions. No restaurant wants to become a victim of embezzlement. Cloud-based accounting systems offer significantly improved fraud prevention over traditional ones. You can install access controls in cloud-based systems which prevent unauthorized users from accessing financial records. They also keep a better usage record so you can know which user did what at what time.

Allows You to Shift Focus to Other Core Aspects

With all the time you'll have freed up after improving your accounting system's efficiency, you can focus on other core aspects of your restaurant business. Improve upon your customer service, or work upon employee performance or marketing your product or whatever it is that you need to take your business to greater heights.

The global restaurant business trend is shifting towards automation with a motive to eliminate as much manual work possible. This leads to greater efficiency as automated systems require lesser time and money input and are more reliable and accurate. If you're looking to improve your organization's accounting system, a cloud-based system is highly recommended. The benefits will definitely prove satisfactory.

Cogneesol is a well known ISO certified firm providing excellent accounting services in the reasonable price.  For further information, contact us at info@cogneesol.com or call us at +1 6466882821

How To Outsource Your Accounts Payable and Accounts Receivable?

In the present time, companies are bombarded with the challenges of running their company expenses in the most appreciable and cost-effective manner. This isn't just helping you become the best, but also let you see different sources in order to minimize your expenditure standards.

Basically, with the business expansion purpose, a company, usually, go for performing a different kind of transactions with either business houses or clients. In accounting language, these transactions are called accounts payable and accounts receivable.

Companies often go for accounts payable services in order to have a better access to the financial affairs. But before we understand the value of outsourcing such services, let’s discuss the basic difference between accounts payable and accounts receivable of a company.

Accounts Payable :

Usually, a company goes for purchasing raw products or any kind of goods (in which they deal) from a vendor. When the company is not financially strong in order to purchase the goods and thus get some credit from vendors, then the amount to be paid by the company is acknowledged as accounts payable. In other words, it can be called as a company liability.

Generally, a deal is signed between the two parties (vendor and company) so that the situation of breach of contract can be avoided.

Accounts Receivable :

It is an amount that the company is supposed to receive from the buyer who purchased the goods or services on credit from the business. Almost every company pays off the amount on behalf of the consumer by signing a deal or agreement where both the parties (customer/buyer and company) are required to mention the certain amount and time frame within which the transaction needs to be paid off.

As per the basic rule, whether it is the account payable or receivable amount, the company and the buyer need to clear it within the set time frame of 30 days. Make sure, if you are practicing any of these transactions in your business, you are maintaining a record of the same. This is important because it can work as an evidence (if needed).

How to outsource accounts payable and accounts receivable?

Now, this can be one basic question that you might be headed with right now. There are a lot of companies who outsource accounting services. All the company needs to do is provide a basic financial structure to the outsourced agency which ensures them about the financial condition of the particular company.

These days, tying up with any accounting service provider is not that difficult. You can find multiple options for your business, all that is required is a smart and wise choice of outsourcing agency.

Its three necessary steps:

Under the outsourced accounting payable and receivable activities different practices exist. Take a look at what they are-

• Receipt making for ERP- Receipt making basically belongs to data creation and entry. Here, the tasks of data entry are accomplished by either digital or manual means.

• Approving and passing resolutions- Generally, approvals are given by a higher authority after analyzing the financial status of the company. Inquiry procedure from both parties is practiced under this process.

• Invoice preparations- Automatic invoice processing is the best part of outsourced accounting services. When the use of latest technology is involved, the process becomes easier and we are able to enjoy better and accurate result orientation.

Why companies hire accounts payable and accounts receivable services?

Every company dreams of being served by the expertise of assistance, especially when the matter is relevant to their accounts and finances. In such cases, going for outsourcing accounting services becomes the first preference. As companies get endless leverages of outsourced accounting services such as-

• Better access of finances

• It waves off your worries regarding maintenance of accounts

• Strong economical groundwork

• Easier transactions

The list is quite long. Outsourcing provides you the chance of being benefited with quality services and that too performed in the companionship of the latest technology. This cut offs the headache of establishing different types of equipment and techniques into your business house.

Check this video on the same :

Read Also : 

Is it Beneficial to Outsource Accounts Payable & Accounts Receivable?

Get to Know the Cost of Accounts Outsourcing Services

Outsourcing Accounting Services: Pros and Cons

When Should You Outsource Your Accounts Receivable?

Businesses consistently make choices regarding which internal divisions to expand based on their prospective cost versus productivity. In such a contemporary age of business, outsourcing is an extremely advantageous approach to fundamentally incorporate complete departments without ensuing related expenses of developing them in-house. However, the question that now arises is which parts of the business ought to be outsourced? Tasks like sales and business development are usually best-taken care of in-house, mainly because they are full-time requirements and are at the heart of any company's essence.

Nevertheless, functions that necessitate a lot of expensive assets, professional knowledge, and are not always full time requirements like marketing and collections, are usually best managed by a business process outsourcing company.

At first glance, Accounts Receivable might appear like a process that could be dealt with in-house by non-specialist staff-and this may prove to be the situation for small-scale companies. Nevertheless, as companies flourish, handling accounts, preventing overdue accounts, and managing the ones that enter into collection status might end up being far too complicated to be administrated without expert involvement from outsourcing companies.

Outsourcing companies surely have the operations in place to handle customer accounts and the resources available to seek out debtors that have shifted without a forwarding address.

Using the services of outsourcing service providers to merely pursue debts when they have hit overdue status is a lot more expensive when compared with avoiding the situation at the outset through the snugly regulated accounts receivable process. Statistically asserting, as soon as an account is 90 days past due, you are anticipated to barely obtain 73 cents on every dollar. After six months, that number dwindles to 50 cents on the dollar and then all the way down to 25 cents after a year. In many cases, the cost of bad debt amassed by outsourcing companies after the actuality is a lot more than avoidance through outsourcing.

The best time to outsource accounts receivable tasks to outsourcing companies is different for each and every business. You will need to determine your present bad debt and compare that to the average in your trade. In the event that your bad debt is equivalent to or above that of the market average, you are losing more money than obligatory by lacking effective accounts receivable procedure. Counting on outsourcing companies as accounts receivable outsourcing solution is a way to get hold of bad debt instantly and with no significant upfront expenses.

Get to know, which is a better accounts receivable management process, inhouse or outsource? Click on this video to find out:

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