Modern Accounting: Using AR Automation to Boost Cash Flow

June 9, 2022

This is a guest blog post from our partner BlackLine, explaining how to gain cash flow confidence with AR automation.

Disruptions, Borrowing & Inefficient Processes
Raise the Bar With AR Automation

Put simply, a significant reason businesses are struggling right now is a lack of working capital. Preserving and maintaining sufficient cash flow is crucial for the stability and success of a business. When it’s reduced or restricted, businesses have less ability to perform, pay, and invest, meaning many turn to costly borrowing.

Businesses with a stronger cash culture are more likely to make it to the other side. Research from McKinsey shows that businesses that prioritize cash flow are more capable of recovering faster after disruption, especially in a post-pandemic world.

It all starts at the top. And by making cash a priority, CFOs are setting the tone for business success.

Disruptions, Borrowing & Inefficient Processes

Time is of the essence when it comes to achieving business success. But because traditional processes aren’t typically time efficient, finance leaders are challenged with aligning and unifying their cash flow systems. The longer that cash is unreachable, the older the debt gets, and the likelihood of receiving a payment in full is reduced.

You might think taking the tried-and-tested route of borrowing will work better for your business. While that may seem like a good idea at first, rising inflation and stringent lending conditions can create complications later down the line. Easy fixes like this only temporarily bridge the gap for businesses lacking cash—and you can end up paying through the teeth for it.

The pressure brought on by the biggest disruption of all—COVID-19—is urging finance leaders to make better, more confident, and strategic business decisions. But to do so, greater business intelligence is required.

According to the Hackett Group financial report, finance executives consider it somewhat likely that innovation will fundamentally change the way financial functions work, yet relatively few leaders are acting on it currently.

Without using AR data in the right way, businesses are less capable of understanding and categorizing customers, debtors, and their cash flow.

Raise the Bar With AR Automation

In 2019, PWC calculated that $1.5 trillion dollars was held hostage on global balance sheets. Without access to that working capital, CFOs have less opportunity to drive business success.

But there’s a solution: get your cash flow moving to a different beat.

By implementing AR automation, you can unlock working capital with ease and achieve greater visibility into your cash position, keeping your business machine well-oiled and functioning to its full potential.

What’s more, you can surface critical customer data that your business can use to transform its cash culture for the better—and enable you to make more strategic business decisions that have a company-wide impact.

Plus, with greater cash availability comes greater financial flexibility. AR automation means you won’t have to rely on costly borrowing thanks to increased access to working capital from within. This also allows you to build financial resilience to cope with whatever is around the corner.

The market’s moving, and it’s time for you to move with it. With BlackLine AR automation by your side, you have the tools to boost your cash flow and improve business outcomes.

This blog post was originally published on the BlackLine blog.https://www.blackline.com/blog/how-to-gain-cash-flow-confidence-with-ar-automation/