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Robotic Process Automation (RPA) in Finance: Use Cases

Robotic process automation (RPA) has been redefining automation in finance and accounting. It would not be an over-emphasis to conclude that the shift is faster than any form of technologies in existence.

However, the question has always been, “Why is RPA gaining so much momentum?  For newbies, RPA will simplify data by 80% in financial close, accounts payable, tax accounting, and lots more.

Using RPA in Finance

  1. RPA optimizes credit card processing
  2. RPA Finance Processes secures endpoint against  cyber threats
  3. RPA in finance & accounting optimizes KYC
  4. Detailed RPA Use Cases in Account Payable
  5. RPA Finance: Only Automate Having Standardized Processes
  6. How Does RPA Analysis Project and A Process Standardization Play Out in Finance and Accounting?

RPA in finance and accounting is becoming popular as robotic process automation in financial services continues to become more popular. RPA finance is bridging the gap created by the barriers of disparate systems and legacy in the finance and accounting models, which have had a significant impact on the operational reliability of back-office finance and accounting operations and internal clients of shared solutions functions.

The vast majority of financial establishments still depend on manual processes, which create unnecessary costs, increase the probability of fraud and errors, and also make them inefficient.

Finance process automation can eliminate these concerns and enhance front-end and back-end business operations. A notable instance in banking is the processing of accounts payable. This is usually a rigorous and monotonous task.

Typically, accounts payable processing would demand extracting, authenticating, and processing specific data. Optical character recognition, OCR for short, reads the information, relays it to the RPA framework which now approves it, then completes the transaction, and also communicates to the employees if there is an error.

Furthermore, RPA in financial services can enhance other forms of services that are utilized in financial establishments daily. These include generating reconciliation of account balances, as well as financial statements. It can significantly speed up the overall documentation flow, report automation procedures, and account closure requests.

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RPA optimizes credit card processing

The implementation of RPA in the finance sector can substantially optimize the application processing of the credit card. It is capable of interacting with different systems at the same time and authenticate various forms of data such as credit and background checks.

Most notably, RPA operates on pre-established rules and has the propensity to accept or reject requests or applications. The significance of robotic process automation in finance does not stop at optimized credit card processing. It can also impact various aspects of credit management aspects, such as underwriting solutions for potential borrowers.

RPA Finance Processes secures endpoint against  cyber threats

RPA in finance and accounting provides qualitative protection for securing financial endpoints against cyber threats. The technology helps fraud analysts in automating a conglomerate of processes, such as blocking and reissuing compromised accounts, scanning of harmful files automatically for recent updates, tweaking the account restrictions requirements, and more.

RPA in finance & accounting optimizes KYC

Another notable instance of robotic process automation in finance and accounting includes the optimization of Know Your Customer (KYC). KYC is a necessary process for every bank client and based on the Reuters survey; financial institutions spend about $500 million in complying with KYC procedures globally. The cost of analog KYC processing is minimal with RPA. Also, client data are assessable with minimized errors and enhanced accuracy. As a result of its perceived benefits, the future of process automation financial services looks promising. The general RPA revenue is growing steadily and will continue to increase in the next six years.

Detailed RPA Use Cases in Account Payable

Let’s examine the scene for RPA use cases in finance and accounting using a robotic accounting as a case study. What does a day in the life of Sharon, accounts payable clerk looks like?

The pre-RPA process looks like this:

  • Sharon has Excel, QuickBooks, Outlook, and a PDF invoice open on her PC.
  • Sharon extracts the client’s data (Name, Contact Address, invoice number, and amount) from the PDF invoice extracted from Outlook.
  • She pastes it into the Spreadsheet to aid internal financial reporting.
  • Then, she passes the same information into Quickbooks.
  • Sharon can cut a check for a client.
  • She subsequently has to copy and paste data from Quickbooks into the Outlook to intimate the organization that she cut the check to confirm processed payment.
  • We are even sweating for talking about this process!

Sharon’s work-life could be simplified if she relaxed and appraised the process shared above, archived the accounting workflow, and decipher what aspects or fields had to be copied and pasted from one application to the other. In addition to that, it would have been the ability to automate the entire processes. Nevertheless, that’s precisely what robotic process automation in finance and accounting sounds like. 

You can eliminate the entire copying and pasting processes if you commit considerable time to standardize the procedure and then incorporating an RPA action on it.

RPA Finance: Only Automate Having Standardized Processes

As long as processes are duly analyzed, implementing RPA in Finance and Accounting can:

  • Automatically verify, validate, and send invoices to clients.
  • Minimize manual review procedures in AR.
  • Enhance the accuracy of the information in Quickbooks, SAP, or related core accounting frameworks.
  • Minimize manual endeavors in finalizing sub-ledgers in close procedures.
  • Minimize human errors.

It does not have to be rigorous implementing RPA in finance, even if it appears so in the first attempt.

Anyway, it’s not enough to throw a bot at another person’s spreadsheets and term it successfully implemented robotic process automation in finance. The ideal strategy is to optimize the process and standardize data across various FTEs first. Then, incorporating RPA to core systems is much less likely to require more than a few months.

How Does RPA Analysis Project and A Process Standardization Play Out in Finance and Accounting?

Step 1: Have the robotic accounting task scoped.

Every finance and accounting processes have unique operations workflow with respect to RPA. The first approach in any finance and accounting task is to identify a streamlined scope of processes that can leverage robotics. The main point is to initiate and subsequently scope up. Having a big-picture before embarking on any pilot program can leave you with developer costs and more rework.

Functions in finance and accounting that leverage RPA:

They include Accounting & Reporting, Accounts Receivable, Accounts Payable, Expense Management, Budgeting& Forecasting, Tax, Internal Audit& Compliance, Payroll, and Treasury Management. Accounts payable has the propensity to synchronize with robotic accounting compared to a process such as budgeting which requires a lot of human calculation.

Step 2: Identify the cost of baseline operations in a bid to estimate the overall benefits obtained from automation in finance and accounting.

You cannot know the financial implications and RPA use cases in finance if you don’t determine the initial operational expenses. This is why establishing the baseline cost is very significant for running a robotic accounting project. If you need to convince your investors, you can share with them the financial benefits.

Step 3: Analyze the existing state financial and accounting procedures to highlight RPA use cases and benefits.

Having figured out the accounting work streams and what the screens that require automation resemble, deploy process mapping software to symbolize the process visually.

Step 4: Standardize accounting procedures and processes.

Do it before or while implementing RPA- but do not standardize after implementation. If you are not willing and ready to perform analysis and standardization on the manual procedures, don’t even bother to think about RPA finance.

Step 5: Outsource an RPA vendor to implement the process or do it yourself.

Nevertheless, understanding RPA software does not mean you will be able to scale without performing several scoped up analysis. If you lack experience in lean process improvement, change management, or lack of background in consulting works, you had better hire a pro to assist.


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