How to automate your accounting processes for maximum efficiency

If you’ve ever experienced manual accounting processes, these common pain points unfortunately might be all too familiar. Data entry errors end up being commonplace due to the manual handling of large volumes of data, leading to discrepancies in financial reporting and analysis. And the extensive time spent on repetitive tasks like data categorization and reconciliation not only delays reporting timelines but also takes resources away from strategic financial planning. As a company scales, these manual methods grow increasingly burdensome — intensifying the risk of errors and inefficiencies.

With all of these bottlenecks, the lack of real-time financial insights negatively impacts decision-making processes. Finance leaders have no choice but to rely on outdated information for critical business decisions — and this lag in information can lead to missed opportunities or misaligned financial strategies. Collectively, these bottlenecks dramatically slow down a company’s operational speed and prevent the finance team from contributing to business growth and profitability.

The adoption of accounting automation offers numerous benefits that can significantly improve your financial processes. From increased accuracy to cost savings, these advantages can help your business thrive and adapt in a rapidly changing market. Let's explore the compelling reasons why accounting automation is becoming indispensable for forward-thinking companies.

Enhanced efficiency and productivity

Businesses rely on accountants — but they’re in short supply. According to the Wall Street Journal, more than 300,000 accountants quit their jobs from 2019 to 2021, leading to a 17% decrease and a big shortage in the US. To make things worse, the number of new accounting grads is dropping, too, with fewer students deciding to go into accounting.

Luckily, automation can help with all sorts of accounting tasks. This allows accounting teams to spend less time inputting information and data, and use automation instead — so that the team can focus on leveraging the information for analysis. This shift in focus enhances team productivity and workflow efficiency, empowering finance leaders to unlock and allocate resources more effectively.

Improved accuracy and reduced errors

Automation eliminates the human error inherent in manual processes, ensuring data accuracy across financial operations. Enhanced accuracy facilitates reliable financial reporting and informed decision-making, contributing to overall business stability and growth.

Real-time visibility and financial insights

With automated accounting processes, you’ll have real-time data and insights into financial performance — at any point in time — creating a framework to make informed decisions promptly. Need to pull data over the last month for the board? Looking to share information with the CEO? Or perhaps you want to respond to a question asked during your company’s all-hands meeting? With automation generating up-to-the-minute insights, you’ll always have quick, easy access to accurate information.

Cost savings and scalability

Not only does accounting automation help you guide your decision-making, but it comes with all sorts of cost savings and scalability — as you’re essentially reducing reliance on manual labor. And by improving and optimizing workflows, you’re less likely to have teams spend time fixing manually-generated errors or redoing work. One additional benefit is that these automated processes are built to scale seamlessly with your company’s growth — like adapting to a large volume of transactions and increased complexity without compromising efficiency or errors.

As we’ve covered, making your accounting processes more automatic offers many benefits for you, your accounting team, and your company’s future.

Here are five common accounting workflows that you can automate:

1. Transaction categorization: Automate categorizing expenses using machine learning — eliminating manual sorting. Brex does this by reading transaction data and feeding it to your accounting software.
2. Bank reconciliation: Remove manual data entry and ensure accuracy by having a spend platform like Brex auto-match bank transactions with spend data.
3. Bill payments: Automate payments by having invoices automatically converted to bills. Brex AI does this plus routes for approval based on predefined criteria.
4. Expense reporting: Automate real-time expense reports categorized by department, project, or vendor to simplify spend management.
5. Receipt management: Auto-generate IRS- and audit-compliant receipts electronically, then let Brex auto-match to expenses — cutting down on paper clutter and simplifying expense reporting.

Accounting automation can significantly reduce errors and increase productivity in your financial operations. Following these six straightforward steps will help modernize your accounting practices and drive your business forward.

Step 1: Identify accounting automation opportunities

Before starting the process of automating accounting tasks, it’s important to analyze your existing accounting workflows to pinpoint the exact areas where automation can offer the most benefit. We spoke with Gary Meisner, Principal Value Management Consultant at NetSuite, about how to identify accounting tasks that are ripe for automation.

“Companies should be looking for tasks that are repetitive, time-consuming, and prone to human error — tasks where there’s great risk and little value being added,” Meisner says. “As you look across all the different initiatives you manage, the more that check those boxes, the more you’re going to want to figure out how to automate them.”

See if you’re able to identify potential areas where you can implement automation — like recurring tasks, data entry points, accounts payable, and software integration gaps. You’ll want to consider factors like task volume, level of complexity, and error frequency, too. Brex offers several solutions that you can easily use to remedy these areas mentioned, such as automatic transaction categorization. This is done by analyzing spending and categorizing expenses accurately, eliminating the monotonous task of manual coding.

Step 2: Choose the right accounting automation tool

Now that you’ve analyzed where to incorporate accounting automation, you’re ready to start selecting your accounting automation solution. Here are some features worth considering when choosing your automation tool:

Automatic transaction categorization

As mentioned earlier, this can remove the burden of manually coding transactions every month. Brex actually offers this with mappings and custom rules that you can use to pair with ERP fields, auto-populating things like GL account, department, or class. And, Brex Assistant uses AI to suggest mappings or custom rules customized for your needs.

Real-time expense tracking and reporting

Rather than wait for employees to fill out and submit spreadsheets of expense information, Brex automates spend management — giving you a real-time view of expenses, attaching automated receipts, using OCR technology to match receipts in any language or currency, and allowing you to customize and export reports at any time.

Integration with bill pay services for automated payments

It can be time-consuming to keep track of invoices, convert them to bills, and then have to worry about approvals and on-time payments to avoid vendor fees. By automating bill payments, you’ll reduce all that hassle. Typically you’ll get several options for uploading invoices, with some options like secure self-serve vendor upload links if you’re using Brex, and invoices will automatically be converted to a draft bill. Brex does all of this — itemizing every detail and suggesting which PO to match to — and routes to the right approver in your Brex dashboard, whether you’re on a desktop computer or using the mobile app. You can even get paid to make payments when you pay via Brex card, earning credit card rewards like cashback, billboard ads, and more.

Automated bank reconciliation

Taking time each month to manually reconcile hundreds or even thousands of items can cost your company a lot. But finding an automated solution that lets you sync transactions directly with your accounting system can save a tremendous amount of time and resources — not to mention, significantly cut down on errors. Brex accounting automation helps you close the books in real time so you’re not bogged down at month’s end.

Step 3: Set up automated workflows

With these features in place, you can set up automated workflows to streamline accounting tasks like expense categorization by department and automated invoice approvals. For instance, you can set rules to categorize ride-sharing expenses under "Transportation" for the "Marketing" department, where specific app transactions like Uber or Lyft rides will be classified under “Transportation” if the owner of the expense is a team member within your marketing department, which you can specify in your settings. You can set up rules, like a specific tier of rideshare or date ranges, for added control. Brex will automatically generate receipts for these rides, then match them against the expense — which will be visible in your Brex dashboard or app as soon as the expense happens — so that everything is all ready to review and auto-record to your accounting software or exported as a CSV.

Step 4: Integrate with your business software ecosystem

To make your accounting team’s daily routine even easier, it’s smart to choose accounting automation features that “play nice” with the rest of your company’s software suite.

For example, Brex has thousands of integrations that boost efficiency, accuracy, automation, and productivity. You can seamlessly integrate Brex with platforms like Slack, where you can enable notifications for spend activity (customizing by expense type, employee, amount, etc.) and even have employees ask Brex Assistant any questions they have about their expenses in Slack. You can also integrate Brex with 50 top HRIS platforms to automatically issue cards and adjust spending amounts when employees join, switch roles, or leave.

Step 5: Monitor and test for smooth performance

With these accounting automation features set up, you’ll want to make sure you can properly monitor and test progress to report performance. One key thing to keep in mind is to test new rules before implementing them just in case you need to make any changes or notice that something isn’t lining up to the right category. Once you have things set up and ready to roll out, you’ll benefit from a solution that lets you review and report on different information, in real time. Brex's reporting features allow you to filter information easily across variables like users, merchants, categories, amounts, departments, and more. You can report on in-policy versus out-of-policy spending, and even use the search bar to find specific information — with the ability to save bespoke views.

Step 6: Continuously optimize for efficiency

As your company’s business needs evolve, it’s critical to regularly review and refine automated workflows to make sure they’re set up to adapt as your business does. For example, you can keep your rules up to date to include new expense categories or newly onboarded vendors. Brex AI will learn from your rules and patterns and suggest more rules that help you save time and increase efficiency. And you can accept, edit, or reject the rule so you’re always in control.

Because Brex is consistently building products and features centered around customer needs, you’ll always have access to new features each season that leverage the most powerful technology — like improved machine learning to provide the maximum agility needed to keep your business running strongly and sustainably.

If all of this sounds beneficial for your business, the great news is you can implement these processes easily with Brex. By maximizing efficiency with automated accounting processes using Brex's comprehensive solutions, you’ll be set up to deeply benefit from easier workflows, enhanced accuracy, and improved operations.

Sign up for a Brex demo today to learn how to automate your accounting workflows for maximum efficiency and unlock growth for your business.