Numbers do count. Needless to say, it is especially true in finance and accounts payable, as the most innocent accounts payable errors may snowball into significant proportions. In our new report, The cost of accounts payable errors 2021, we dig deeper into the accounts payable and accounting processes of some of the biggest companies in the Nordics.
The report is the latest in our Lost in transaction series and the result once again shows that capital loss is common across industries and regions due to transaction-related errors, human and system-related.
Despite that Nordic organizations, in general, are among the most technologically advanced, bottom-line results are continuously hurt by accounts payable errors such as double payments, VAT errors, and missed credit notes. The errors cause capital leakage without anyone noticing, despite rigorous controls which add to the workload of finance teams.
Here are some quick take-aways from the report:
- 100 analyzed companies
- Denmark, Norway, Sweden, and Finland
- 20,872,182 analyzed supplier invoices
- 86,276 erroneous invoices fixed by internal finance teams
- 22.5 working days per company spent on average to correct errors
- 21,569 erroneous invoices—0.10% of all invoices—pass undetected and cause capital leakage
Are there learnings for CFOs and finance teams to be drawn from the report? Are accounts payable errors an inevitable fact of modern finance processes? Not necessarily.
The root cause can be found somewhere in the intersection between poor transactional data quality and the supporting—almost always too manual and analog— processes. The answer lies in a steady focus on improving the quality by taking steps towards 100% structured and completely digital data, and utilize modern automation solutions. Transactional data quality is the cornerstone in any long-term sustainable digital transformation in finance, and the key to eliminate accounts payable errors.
Download the report to get the full result, loss in euro for every processed invoice, breakdown by country, and more.