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Digital Edge
Home»Technology»The Rise of Robotic Process Automation (RPA) in Accounting
Technology

The Rise of Robotic Process Automation (RPA) in Accounting

Michael JenningsBy Michael JenningsAug 21, 2023No Comments7 Mins Read

Accounting teams have traditionally relied on manual processes to handle high transaction volumes. But Robotic Process Automation (RPA) is now transforming accounting by automating repetitive, rules-based tasks. RPA uses software bots to mimic human actions, bringing new levels of speed, accuracy, and efficiency.

Automation of Accounting Documents is one of the major use cases for RPA. Accountants can now easily automate document-filling tasks like invoices, purchase orders, expense reports, and more. Integration with ERP is another key benefit of using RPA in accounting.

For forward-thinking accounting and finance departments, RPA unlocks game-changing performance gains. This article explores how RPA is reshaping accounting through expanded automation capabilities.

Contents hide
1 Understanding RPA Technology
2 Key Accounting Processes Suited for RPA
2.1 Transaction Data Entry
2.2 Report Generation
2.3 Period Close Tasks
2.4 Audits
2.5 Payables and Receivables Processing
2.6 Accounting Research
3 Benefits of Adopting RPA in Accounting
3.1 Increased Throughput
3.2 Improved Accuracy
3.3 Cost Savings
3.4 Seamless Integration
3.5 Enhanced Analytics
3.6 Better Use of Human Talent
3.7 Extended Capabilities
4 RPA Implementation Considerations
4.1 Take a Strategic Approach
4.2 Focus on User Impact
4.3 Standardize First
4.4 Validate Data Quality
4.5 Secure Sensitive Data
4.6 Start Small, Scale Up
4.7 Monitor and Optimize
5 Implementation Models
5.1 In-House
5.2 RPA-as-a-Service
5.3 RPA Consulting Firms
5.4 Integrated ERP Solutions
6 Sample Accounting RPA Use Cases
6.1 Automated Report Generation
6.2 Invoice Processing Automation
6.3 Audit Prep Acceleration
6.4 Faster Transaction Posting
6.5 Journal Entry Automation
7 Emerging RPA Advancements
8 Best Practices for RPA Adoption
8.1 Take an Enterprise Approach
8.2 Engage Department Stakeholders
8.3 Focus on Value Over Cost
8.4 Build In-House Expertise
8.5 Start Small, Then Scale
8.6 Keep Existing Systems
8.7 Monitor KPIs
8.8 Add AI Capabilities
8.9 Secure End-to-End
9 The Bottom Line

Understanding RPA Technology

RPA tools allow configuring software robots to carry out manual processes just like human workers but far faster and without errors. Some key capabilities:

  • Interact with any software interface just as humans do, entering data, conducting analysis, completing forms, etc.
  • Operate 24/7 without breaks, holidays, or sick time.
  • Scale up or down on demand to accommodate workloads.
  • Eliminate human data entry errors with reliable digital accuracy.
  • Save and analyze digital audit trails documenting all activities.
  • Integrate inputs and outputs across multiple platforms and data sources.

For accountants, this means automating many tedious tasks that previously required using accounting software manually or performing data transfers between systems. RPA bots act as virtual accounting team members with superhuman speed and precision.

Key Accounting Processes Suited for RPA

While RPA cannot entirely replace human judgment and oversight, it excels at taking over repetitive, rules-based steps. Areas with high potential for accounting RPA adoption include:

Transaction Data Entry

Transferring invoices, bills, receipts, and other source documents into accounting software like QuickBooks is tedious yet critical work. RPA bots reliably speed up capturing high transaction volumes with 100% accuracy. They can validate inputs, flag exceptions for review, and reconcile to source data.

Report Generation

Bots can be configured to pull data from multiple systems and databases, perform calculations and analyses, and create financial reports. Automated report generation improves consistency and handles large volumes fast.

Period Close Tasks

RPA helps accelerate all the repetitive steps required during period closing like account reconciliations, amortizations, accruals, depreciations, journal entries, and more. This alleviates bottlenecks.

Audits

Streamlining data gathering, analysis, and documentation for audits is a prime use case. Automated work papers also reduce audit costs.

Payables and Receivables Processing

Verifying, posting, and reconciling high volumes of vendor and customer invoices is ripe for automation. Bots integrate with AR/AP software to accelerate order-to-cash and procure-to-pay cycles.

Accounting Research

Bots can rapidly gather data from multiple sources, analyze options, and deliver recommendations to support decisions on accounting treatments and financial plans.

RPA transforms previously manual accounting workflows into automated, integrated digital processes.

Benefits of Adopting RPA in Accounting

The upside of accounting automation with RPA includes:

Increased Throughput

Bots process high workloads faster with near-instant turnaround unmatched by human speed and attention. All tasks repeat consistently at peak efficiency without lags.

Improved Accuracy

Automated accounting tasks follow programmed logic flawlessly every time, avoiding human oversight and data entry errors. This improves compliance and decision quality.

Cost Savings

RPA maximizes productivity at a fraction of human staffing costs. Bots scale flexibly allowing redeployment to other processes as needs change.

Seamless Integration

Bots easily integrate inputs and outputs across accounting programs, ERPs like SAP, databases, and more. This streamlines cross-functional data flows.

Enhanced Analytics

Detailed digital audit trails generated during automated processing provide valuable analytics insights into how work gets done.

Better Use of Human Talent

RPA handles routine tasks programmatically so accountants can focus on high-value analysis, exceptions, advisory services, and building client relationships.

Extended Capabilities

Bots expand what can be accomplished programmatically beyond manual effort constraints. They work around the clock without overtime or burnout. RPA thus unlocks game-changing productivity, accuracy, insights, and value.

RPA Implementation Considerations

Reaping the full benefits of accounting RPA requires following some best practices:

Take a Strategic Approach

Avoid a siloed or ad hoc approach. Align automation to overarching finance digital transformation strategy supported by leadership.

Focus on User Impact

Design automation around improving user experience and empowering people through new capabilities, not just cost savings.

Standardize First

Standardizing accounting procedures across locations as much as possible simplifies defining automation rules. Document processes meticulously.

Validate Data Quality

Confirm inputs have sufficient data quality and integrity before automating downstream processes. “Garbage in, garbage out” still applies.

Secure Sensitive Data

Implement proper access controls, encryption, and activity logging for automated handling of financial data. Privacy and security remain imperative.

Start Small, Scale Up

Pilot RPA for a contained process or function first. Once proven, expand scope through incremental additions.

Monitor and Optimize

Analyze automation performance indicators like cycle times, error rates, and system effectiveness. Continually tune RPA bots and rules.

Following a thoughtful roadmap prevents haphazard automation and ensures smoother change management.

Implementation Models

Organizations have a few options for deploying RPA capabilities:

In-House

Develop automation using dedicated internal RPA teams. Gives you full control but requires more effort to master tools.

RPA-as-a-Service

Cloud solutions like UiPath and Automation Anywhere provide RPA on a subscription basis. Fast to implement but some vendor dependence.

RPA Consulting Firms

External specialists design and deliver automation tailored to your needs. Brings accelerated expertise.

Integrated ERP Solutions

Major ERP vendors like SAP now offer integrated RPA modules. Streamlines automating core ERP-centric processes. Choose the model aligning best with your automation goals, resources, and capabilities.

Sample Accounting RPA Use Cases

Seeing RPA in action across core accounting processes illustrates its immense potential:

Automated Report Generation

RPA pulls data from billing systems and inventory databases and compiles it into monthly financial statements, KPI dashboards, and management reports. Greatly accelerates period close.

Invoice Processing Automation

Bots extract key details from emailed invoices, validate against POs, update AR and AP ledgers, generate payments, and notify stakeholders. Removes manual steps.

Audit Prep Acceleration

Automating consolidating records, running audit tests, and producing schedules and work papers drastically reduces auditors’ prep time.

Faster Transaction Posting

Reading forms and statements, entering into accounting software, reconciling line items, and handling exceptions speed up with automation.

Journal Entry Automation

Parameter-driven bots can create adjusting entries, accruals, amortizations, currency conversions, intercompany transfers, and more. RPA streamlines accounting’s highest-volume activities.

Emerging RPA Advancements

As RPA matures, expect ongoing enhancements expanding capabilities:

  • Smarter self-learning bots powered by AI and machine learning
  • Natural language interaction allows freeform human-bot collaboration
  • Visual perceptive abilities to automate tasks involving scanned documents, image analysis, etc.
  • Predictive analytics during processing to flag expected issues and recommend actions
  • Expanded process event-triggering capabilities with chatbots, IoT sensors, and more
  • Broader integration across business systems, data sources, and technologies

RPA will continue elevating accounting automation to new heights.

Best Practices for RPA Adoption

To fully capitalize on RPA benefits for your automation of accounting documents, organizations should follow these adoption best practices:

Take an Enterprise Approach

Coordinate RPA initiatives company-wide. Identify functions with the highest automation needs and impact.

Engage Department Stakeholders

Involve departments like accounting early to capture expertise automating their unique processes.

Focus on Value Over Cost

Emphasize boosting capabilities over just reducing headcount. Redirect savings to innovation.

Build In-House Expertise

Develop internal RPA skills and access to tools. Reduce reliance on external vendors over time.

Start Small, Then Scale

Prove value with targeted pilots before expanding. Let early wins build confidence and appetite.

Keep Existing Systems

Automate around current ERPs and software instead of overhauling technology.

Monitor KPIs

Quantify performance gains from automation with metrics like time savings and accuracy. Continue optimizing.

Add AI Capabilities

Incorporate AI for smart exception handling, predictive analytics, and more.

Secure End-to-End

Protect confidential data throughout the automated process. Log and audit all activities.

With careful adoption, RPA supercharges accounting productivity and performance.

The Bottom Line

RPA marks a turning point for modernizing accounting operations through transformative automation technologies. The benefits of speed, accuracy, and integration at scale are too substantial to ignore.

With a thoughtful adoption roadmap, RPA can take accounting productivity to unprecedented levels while freeing up the capacity to focus on high-value initiatives. The rise of accounting automation is just getting started.

Michael Jennings

Micheal wrote his first article for Digitaledge.org in 2015 and now calls himself a “tech cupid.” Proud owner of a weird collection of cocktail ingredients and rings, along with a fascination for AI and algorithms. He loves to write about devices that make our life easier and occasionally about movies. “Would love to witness the Zombie Apocalypse before I die.”- Michael

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