Generative AI (Gen AI) is poised to revolutionize Finance and Accounting (F&A), with substantial investments being funneled into this rapidly evolving technology. A striking illustration of the finance professionals' enthusiastic adoption of Gen AI comes from a recent study by the Centre for Economics and Business Research and Moore Global, an esteemed international accounting, audit and advisory network. Their findings indicate that, in just the past year, accountancy firms have invested in AI systems at a rate nearly four times greater than that of law firms and other professional service entities.1
But how effective is the strategy backing this investment, and what kind of return – if any – can they expect? Or do they risk wasting money? To maximize their investment, finance professionals should focus on the impact of Gen AI in streamlining the accounts payable process.
Gen AI-powered accounts payable solutions can improve efficiency, compliance and effectiveness, and supplier stakeholder management – enabling this essential function to make a greater contribution to the finance department and the overall financial health of the business. Already, many accounts payable departments are using Gen AI to transform unstructured data into usable information and increase their automated, data-informed activities.
Figure 1: Gen AI in Accounts Payable
Gen AI offers a multi-faceted approach to invoice processing, capable of extracting data from unstructured, multi-format and multi-language invoices. It enhances Optical Character Recognition (OCR) engines by intelligently mapping extracted data to its relational context, significantly improving accuracy. Its template-free extraction, utilizing techniques like Natural Language Processing (NLP) and computer vision, adapts to diverse document layouts and even interprets handwritten sections.
Gen AI also plays a crucial role in compliance adherence during data extraction, flagging discrepancies for human review and summarizing supplier rejection reasons. Additionally, by analyzing patterns and anomalies in invoice data, Gen AI aids in identifying potential fraud, thus preventing unauthorized or duplicate payments. Furthermore, it classifies invoices and segregates spam or advertisement e-mails in the invoice inbox, streamlining the entire invoice processing system.
Gen AI significantly enhances invoice processing by offering line-level matching, Value-added Tax (VAT) coding automation and automated approvals for two-way match invoices in Purchase Order (PO)-based scenarios. In non-PO invoicing, it assists with General Ledger (GL) coding and selecting the right approvers using historical data and NLP. Additionally, Gen AI streamlines exception resolution by identifying discrepancies, recommending solutions and providing detailed error summaries for quicker resolution by buyers or approvers.
It adeptly manages multi-currency transactions, ensuring accurate financial reporting and adherence to exchange rates. Furthermore, Gen AI conducts Horizon Scanning to monitor compliance with country regulations and internal policies, flagging potential issues for a streamlined accounts payable process.
The integration of Gen AI in accounts payable helpdesks, encompassing semantic search and sentiment analysis, revolutionizes efficiency and vendor satisfaction. These helpdesks, essential for positive supplier relations, traditionally grapple with high costs and error risks. Gen AI transforms this with AI-driven bots and e-mails, offering faster and more accurate information retrieval. This significantly enhances response times and understanding of various inquiries.
Sentiment analysis further improves prioritization and response quality, personalizing and empathizing with each supplier's needs. In complex cases, it supports human agents with real-time data for better assistance. Additionally, NLP analyzes conversation transcripts to identify recurring issues, guiding continuous process refinement and evolving the helpdesk into an intelligent, adaptive assistant that consistently surpasses supplier expectations.
Gen AI employs Horizon Scanning for vendor due diligence, credit and Tax Deduction and Collection Account Number (TAN) checks, ensuring thorough and accurate validation of vendor information. Continuous monitoring identifies and flags potential risks in vendor profiles, enabling informed decision-making in managing vendor relationships.
Vendor reconciliation, though essential, is typically time-consuming and cost-intensive. Gen AI can seamlessly extract data from varied vendor statement formats, including unstructured data. Rather than having your accounts payable staff translate this information into the correct format, Gen AI can convert unstructured data to structured data. It automates reconciliation, provides narrations for unmatched items, automates accruals and offers enhanced forecasting and budgeting by analyzing historical data for deep insights and accurate predictions.
Figure 2: Gen AI Use Cases in Accounts Payable
A European shipping and logistics firm successfully trialed a similar solution on the WNS TRAC AI / Machine Learning (ML) platform. This touchless invoice processing system adeptly handles PDF invoices in various languages sourced from e-mails and portals. It executes data extraction, validation and matching with POs and goods receipt notes. Furthermore, the system manages cost coding and GL entries, integrating with ERP systems. A notable feature of the solution is its advanced ML ability, which efficiently distills key details from complex, multi-vendor invoices. This represents a significant advancement in automated invoice processing.
A leading U.S. freight forwarding company achieved remarkable strides in enhancing the efficiency of its invoice processing system. This system processes multi-language invoices received via e-mails, performing tasks like data extraction, validation and matching with POs – all integrated into the Enterprise Resource Planning (ERP) system. This resulted in a 70 percent reduction in processing exceptions.
As F&A leaders seek to implement finance transformation solutions and transition the CFO’s office to a digital-first way of working, Gen AI emerges as a compelling opportunity. However, the journey is not without its challenges, given the technology's complex and ever-changing landscape.
To harness the full potential of Gen AI and ensure its seamless integration into accounts payable processes, it is imperative to collaborate with strategic partners. By allying with specialists equipped with a wealth of sector-specific knowledge, you can confidently navigate the intricate terrain of Gen AI. With the right expertise by your side, the transformative potential of Gen AI in accounts payable automation becomes a reality, leading your organization toward greater efficiency and competitiveness.
To learn how WNS' Generative AI Suite of Solutions can help your organization, talk to our experts.
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Banking and Financial Services
01 February 2022
03 December 2021
31 January 2017