How to automate accounts receivable – a guide for accountants
Managing accounts receivable (AR) is a vital part of the bookkeeping process – without a close handle on what’s owed to a business, it’s impossible to maintain healthy cash flow.
For accountants, this is where you can make a real difference to your clients’s financial health. By tightening up their accounts receivable process, ensuring timely payments, and keeping accurate financial records, you’re not only improving their cash position – you’re helping their business thrive.
Let’s look at how to do it.
Step 1 – Review your current AR process
Before jumping into new tools or systems, take stock of how you and your team handle accounts receivable right now.
Ask yourself:
- How do you receive information from clients?
- How do clients receive invoices or payment reminders from you?
- Which parts of the process are already automated – and which are still manual?
- What accounting software or business systems are you using?
- How are clients interacting with those systems?
- Which steps take the most time or cause delays?
- How well are you tracking outstanding invoices and customer payments?
Mapping out your full accounts receivable process, from invoice creation to cash application, helps you spot inefficiencies. Maybe payment reminders are inconsistent. Maybe you’re spending too long chasing late payments. Or perhaps your team is re-entering the same data in multiple systems.
Once you understand the pain points, you can design a more streamlined AR workflow.
If your practice uses a practice management system, consider building the workflow directly within it. That way, everyone in your firm follows the same process every time – while leaving room for client-specific tweaks.
Step 2 – Start with the right information
A smooth AR automation setup starts with clean data. When onboarding a new client, it’s essential to reconcile their accounts so your accounts receivable ledger reflects the right opening balances and payment history.
This stage sets the tone for the whole billing process. Having accurate financial data at the outset prevents errors and keeps future automation running smoothly.
At Capium, we know the value of accounts receivable automation software: which is why our auto bank reconciliation feature helps accountants do this quickly – matching payments and receipts automatically so your general and AR ledgers stay aligned. In addition to efficient AR processes, accountants can further streamline client compliance with our company secretarial software.
Step 3 – Create reusable invoice templates
Sending invoices is the first step in getting paid, and yet it’s often one of the most repetitive tasks in bookkeeping.
With accounts receivable automation software, you can create templates that automatically pull through key details – like client names, payment terms, and invoice numbers – from your accounting system.
This means fewer clicks, fewer errors, and faster invoice delivery. Clients can send out clear, professional invoices in moments, helping customers pay promptly and improving cash flow management.
Look for accounts receivable automation software that supports recurring invoices too – perfect for clients with regular customers or subscriptions.
Step 4 – Send automatic payment reminders
Chasing overdue invoices can strain both time and client relationships. But automated payment reminders can take the awkwardness (and admin) out of it.
Set up rules in your AR software so reminders go out automatically after set periods – say, 7, 14, and 30 days after the invoice due date.
Automation ensures no payment slips through the cracks, and your client’s cash flow stays consistent. Plus, it reduces manual tasks for your team, helping you maintain productivity during busy periods.
Some AR automation solutions let customers pay directly via a secure payment portal, offering multiple payment options to accelerate collection and improve convenience.
Step 5 – Connect your systems
The best accounts receivable automation software doesn’t just send reminders or track payments – it integrates seamlessly with your wider accounting systems.
That means your accounts receivable data automatically updates your financial statements, feeds into cash flow reports, and syncs across other modules like payroll, tax, or credit management.
Integration eliminates manual processes, reduces duplication, and improves accurate financial reporting. In short, you spend less time moving data around – and more time using it to advise clients.
Step 6 – Measure, report, and refine
Once you’ve employed AR automation software to automate your accounts receivable process, track your results.
Metrics like days sales outstanding (DSO), the number of overdue payments, or the average time to collect payment tell you how well your automation is working.
Many modern AR automation tools come with built-in reporting tools or advanced analytics dashboards. These can help you and your clients identify patterns – such as frequent late payers – and take proactive action to improve collections management.
Over time, refine your workflow, templates, and communication to get even better results.
Automate accounts receivable with Capium
Capium is a cloud-based accounting and practice management platform built specifically for accountants.
Our bookkeeping module lets you automate every step of the accounts receivable process – from invoice generation and automated reminders to payment matching and cash application.
All the data syncs automatically with your other Capium modules, so you’ll always have a clear picture of your clients’ financial operations and cash flow in one place.
By cutting out manual accounts receivable processes, you’ll save time, reduce errors, and help your clients get paid faster – all while strengthening your role as their trusted financial advisor.
Book a free trial today or give us a call on 0203 322 5578 to see how Capium can help you optimise cash flow and streamline your AR automation workflow.
To see it for yourself, book a free trial or give us a call on 0203 322 5578.
