Collection Made Easier: Account Receivables Automation

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“A sale is not considered a sale until collected.”

This short phrase is a commonly used reminder to sales agents because it summarizes the sales cycle: actual sales for products or services and ensures that it is invoiced and adequately collected. Putting this into an analogy, a small store usually sells goods on a cash payment basis - the easiest form in locking a sale into a collection. But, as we move to larger businesses, operations start to differ.

Larger scale companies use Account Receivable (AR) capabilities in their offers by doing business with complex deals or offers, extended payment terms, and consignment agreements with multiple payment options - making it more inviting and easier for their customers.

With the increasing complexity of an "Accounts Receivable" process, parallel to the business size and importance of ensuring proper cash flow and timely collections, businesses migrate from a manual collection into a systematic account receivable automation. This now leaves us with the question: how will collections be made easier with AR Automation?

The Original Process

Accounts Receivable standard processes rely on three major components: invoicing and documentation, receiving and collection, and reconciliations.

Invoicing and Documentation

Invoicing takes place once a purchase order from the client has been placed. Sales Invoices are generated references of the goods or services which have been acquired from a provider. Invoices from these providers may differ from manually prepared, machine output such as Point-Of-Sales (POS) or electronic invoices.

Invoices are considered essential documents in a collection process since they provide the transaction details, deals, and discounts that should be documented upon payments, aside from external variables such as Value-Added Tax (VAT), which reference input/output taxes.


Of the three, this is often the most challenging component in account receivable management. In "recon,” variances start to come in: customer dispute, changes in the initial offers, as well as tax certificates. Computer tools used for collection only do the matching process, where it clears the invoice and actual payments that match, leaving those items which do not match unpaid.

The above scenario describes where reconciliation takes place. The degree of its complexity may lead to delays of full payments, which accumulate from invoice to invoice. This is more prevalent on larger-scale companies when dealing with multiple customers and less stringent for smaller-based customers.

The Automated Process

Accounts Receivable Automation comes in between the original process and makes efficient action throughout the three steps:

Invoicing and Documentation - Simplified

Invoicing will now be produced as a standard printed document, usually in two forms:

  • Hard Copy Invoices
  • – for manual documentation of the customer/receiver; can be provided upon the request of the customer.

  • Soft Copy Invoices
  • – automated to be sent on the registered email of customer, easily documented with send receipt confirmation.

    With a standard format and template for invoices and documentation and referencing made easier, this becomes the first step to a seamless collection process.

    Receiving and Collection - Accelerated

    Proof of Receipts is also made easier with the help of digitalization. Nowadays, delivery allows receivers to acknowledge receipt on their e-platform, immediately updated in the system. This takes away the long lead time of document transmission. Collections are also sped up with the auto-issuance of soft copies, just like the process on invoices.

    With digital tools present alongside the automation process, support for multiple invoice collections is also achieved by simplifying the search for manual receipts. Viewing and selecting the invoices with payment is faster and easy to track. Imagine yourself doing collections at the comfort of your own space at your own pace.

    AR Automations particular to collections saves you time and effort on:

  • Manual checking of invoices.
  • Manual issuance of Collection Receipts/Official Receipts, which are prone to human error; and are time-consuming activity.
  • Attachments such as tax permits and other post-collection materials physical submission.
  • Reconciliations – Time Friendly

    Reconciliations using automated processes will still entail manual back-end work but will save time coming from the simplified and accelerated invoicing processes to the collection. With all details secured within a database of softcopy files, checking of necessary documents is easier, and follow-throughs can be made immediately.

    Faster reconciliations mean faster clearing of payments. Readily available payments improve the cash flow of any given company. Together with the lesser manpower hours allocated to the collection, this efficiency saves company assets and resources.


    Account Receivable Automation is a product of a lean six sigma process of eliminating unwanted wastage of time and creating value into various outcomes - providing a holistic approach for companies and businesses who seek improvement in account receivable management and overall cash flow. Thus, the collection was made easy.


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