Why automated invoice processing is a must for restaurant accountants
Written by: [me] marketeam
CFO 1 Source, New Orleans
Data collected from restaurant invoices is integral to understanding and monitoring a restaurant’s financial health. It tells you exactly how much money is being spent, what it’s being spent on and, when categorized into expense types, gives operators the opportunity to make better financial business decisions.
As a restaurant accountant, you know how valuable invoice data is – and probably what a pain it is to collect and input into your accounting system. Sorting through piles of invoices and receipts just days before (or sometimes after) the reporting period ends is not for the faint of heart. Restaurant invoices see everything from credits to hand-written notes or charge-backs, to even being literally written on the side of a brown paper bag that the bread comes in each week.
Hand-coding invoice data can be stressful thanks to both the usual end-of-the-period time crunch and the amount of detail on each invoice. Timely reporting is next to impossible and often comes too late for operators to make impactful business decisions. Thankfully, technology has turned this into a seamless process enabling restaurant accountants to provide more value to their clients.
Automated invoice processing uses AI to collect invoice data and automatically code it into your accounting system, eliminating manual data entry. This blog looks at four ways automated invoice processing is an essential tool for restaurant accountants.
4 reasons why automated invoice processing is a must for restaurant accountants:
1. Develop even stronger trust with your restaurant clients
First, we have to discuss the elephant in the room: what happens when invoice processing technology makes a mistake? In the accounting world, errors can be fatal for a business or an accountant’s reputation, so implementing any kind of automated technology is a decision that takes no small amount of consideration. Many accountants have been burned by OCR in the past, but not all automated invoice processing technology is created equal.
MarginEdge’s approach to automated invoice processing tackles this with a combination of AI and real, human analyst eyeballs. Errors or discrepancies flagged in the system are sent to our invoice processing team (made up of actual people with prior restaurant experience), so even the oddest of invoice line items are categorized correctly before they ever hit your accounting system.
Raffi Yousefian, owner of The Fork CPAs says that automated invoice processing software, “Allows us to streamline vendor bill payments and statement reconciliation at a price point that’s more than reasonable, all while maintaining an impressive, super-high level of accuracy. It’s a win-win.”
Another added benefit of using automated invoice processing software is both you and your operators can see the same data 24/7. This means no more chasing someone down to get a specific invoice or arguing over whose numbers are correct when there’s a discrepancy.
This system provides transparency to both sides, which is helpful for communication as well as audits and reconciliation. Invoice images are stored digitally in the cloud, so it’s accessible from anywhere and you’re able to easily search and reconcile.
2. Save time (and therefore money)
So, how does automated invoice processing impact your day-to-day as a restaurant accountant? Primarily, it saves you and your team hours' worth of bookkeeping billable hours every week. Raffi also mentioned, “It’s been a lifesaver. CPAs don’t need to spend hours on tasks better handled by technology.” Because invoice data is available in 24-48 hours once fully onboarded into the system, your team gains access to near real-time data without any extra effort.
And not only does it save you time spent on manual entry, but it also enables and encourages restaurants to send their invoices as they receive them instead of in one big pile at the end of the period. Less time on manual entry means more time spent as an actual advisor, letting you provide more for your clients throughout the period – or even having extra time to take on more clients if you’re looking to scale your business.
3. Provide complete reporting faster
With invoices coming in at a consistent pace and the data being at your fingertips in a matter of days, you can quickly provide your clients with more in-the-moment analysis and reporting. MarginEdge provides a daily P&L, because it integrates with the restaurant’s POS system, giving a detailed view of both purchasing and sales.
“Now with the invoice and sales data flowing from MarginEdge right into the accounting system, the team does more of the management-level work instead of the data-entry clerk work,” says Susan Eder, owner of Cue the Accountant LLC. This data helps you point out areas in which your clients can cut back, keep an eye on or where they can keep up the good work.
4. Ensure privacy and redundancy
It goes without saying how important it is to keep client financial information secure and accurate, and automated invoice processing can also help. While the software sends sales and purchasing information to your accounting system automatically, it cannot change anything within your accounting system itself. It also settles discrepancies between numbers and prevents inaccuracy, because the digital image of the invoice is always accessible from anywhere (even your mobile phone).
Using a cloud-based invoice processing system creates redundancy and transparency by providing a centralized source of truth for invoice data. With this technology, you can avoid invoices piling up or getting lost if your bookkeepers go on vacation. This redundancy enables greater reliability without added effort (in fact, it takes less than with manual coding!).
Whether you have one restaurant client or many, automated invoice processing technology is a huge advantage for restaurant accountants. As your accounting business grows, this tool is necessary, as manual entry and monitoring are too time-consuming and cost prohibitive. You can learn more about how software like MarginEdge can help here.