Financial Process Automation Software
Features, Integrations, Benefits, Costs
Having 15-year experience in building financial software and practical knowledge of 30+ industries, ScienceSoft offers custom software development services to help businesses implement effective financial automation solutions.
Financial Process Automation Software in a Nutshell
Financial process automation software helps businesses eliminate manual efforts across finance-related tasks, including bookkeeping, invoicing, payroll accounting, financial planning and analysis, revenue management, tax management, investment and financial risk management, and more.
Depending on their specific needs, companies can implement a solution to automate particular financial operations or enable end-to-end automation of all corporate financial activities.
Go-to integrations: ERP, CRM, HRMS, an inventory management solution, asset management software, etc.
Implementation time: 6 – 13 months.
Development costs: $200,000 – $1,500,000+, depending on the solution’s complexity.
Annual ROI: 200 – 290%.
Financial Process Automation System Architecture
There are several main architectural options for a financial process automation solution, each having its benefits and limitations. ScienceSoft suggests choosing the one that fits your business needs best.
1. Implementing a solution composed of several ready-made or custom modules (or the combination of both), each automating a particular financial process and having its own data store. This option offers automation of all required financial activities and enables flexibility to independently evolve each solution’s module with new features as new business needs arise. However, the solution with such an architecture is resource-intensive to build and maintain and requires profound project management at the implementation stage.
2. Implementing a custom-made highly integrated financial application. This option offers reduced software implementation time and simplified financial data governance due to centralized data storage. On the downside, a solution with such an architecture is difficult to evolve and scale. To connect it smoothly to other business-critical systems, you will also need to employ proper middleware (e.g., an ESB solution), which requires additional costs.
3. Implementing a ready-made highly integrated financial suite to cover core financial process automation functionality and add several custom applications for areas where the suite cannot fully satisfy your company’s needs. This option allows quickly introducing automation of fundamental finance-related tasks in case you don’t need suite customization to meet your highly specific business requirements.
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ScienceSoft recommends: To get faster development and deployment of a cost-efficient and inherently scalable solution, you can consider adding serverless functions, each handling a particular financial team’s task. This approach helps to effectively automate periodic workloads that require a lot of data processing, e.g., preparing regular financial reports or processing scheduled payment flows. The functions can be independently invoked and auto-scaled on demand. However, such an architecture raises security and latency concerns. |
Bookkeeping automation
- Automated creation, updating and approval of journal entries in the general ledger (GL) and subledgers on external and intercompany financial transactions, including multi-currency transactions.
- Automated GL entries to the pre-defined books or to multiple books simultaneously.
- Scheduled recurring and reversing journal entries.
- Automated attachment of source documents (invoices, receipts, cheques, payroll reports, leases, etc.) to each journal entry.
- Rule-based GL coding and transaction classification by category (asset, liability, equity, revenue, expenses, etc.).
- Automated calculation and consolidation of GL balances across multiple business entities.
Order-to-cash automation
- Template-based generation of customer invoices, including recurring invoices.
- Calculation and application of taxes, discounts, additional charges (e.g., interest on late payments, insurance, carriage), and billable expenses.
- Automated workflow for multi-department customer invoice approval.
- Scheduled sending of invoices to customers.
- Real-time customer invoice tracking by status (approved, paid, open, etc.).
- Calculating the received, due and overdue amounts, DSO, accounts receivable (A/R) turnover ratio, and more.
- Automated payment collection via various payment methods, including bank transfers, wire transfers, ACH, credit cards, cheques, or by direct debit.
- Automated allocation of received payments to customer invoices.
- Scheduled reminders to customers on due payments.
Invoice-to-pay automation
- OCR-enabled conversion of paper purchase invoices into a pre-defined digital format.
- Automated capture and extraction of purchase invoice data and its validation against corresponding purchase orders.
- Real-time purchase invoice tracking by status (valid, paid, due, etc.).
- Calculating the amounts paid, partially paid, owed, DPO, accounts payable (A/P) turnover ratio, etc.
- Scheduled payments to suppliers, vendors, governmental entities, etc.
- AI recommendations on optimal payment methods and payment dates.
Payroll and reimbursement automation
- Automated calculation of employee salaries, overtime, bonuses, commissions, deductions, etc.
- Automated capture, extraction, and validation of data provided in receipts on business-related employee expenses (accommodation in business trips, transport, telecoms, etc.).
- Automated workflows for multi-department expense approval.
- Automated calculation of reimbursement amounts per employee.
- Scheduled payroll and reimbursement payments to employees.
Treasury automation
- Real-time monitoring of cash flow, liquidity, working capital, cash balances across bank accounts, transactions on investment and financing activities across various asset classes, and more.
- Automated cash positioning based on the consolidated bank statement data.
- Automated classification of cash transactions (A/R, A/P, payroll, etc.).
- Calculating capital gains and losses, accrued interest, yields, duration, total return by investment portfolio, asset class, region, etc.
- Calculating and scheduling principal and interest payments on the existing liabilities.
- Calculating and monitoring the fair value of assets and liabilities, exposures for FX and commodities, CVA and DVA, CFAR and VaR, and other essential financial risk metrics.
- AI recommendations on optimal hedging strategies.
Financial planning and analysis automation
- Calculating and monitoring user-defined financial performance parameters by period, location, business entity, etc.
- Trend-based financial performance analysis and forecasting.
- Automated adjustment of financial forecasts as new financial data appears.
- Monitoring and analysis of financial forecast variance.
- Template-based budget creation at the enterprise, business entity, department, project level.
- Scenario modeling and what-if analysis for budgets and strategic financial transactions.
- AI-based suggestions on optimal budgets, profitable and risky financial performance scenarios, and more.
Tax management automation
- Calculating VAT, sales, use, withholding, income, and other taxes based on the tax rates in regions a company operates.
- Automated tax filing under region-specific regulations.
- Scheduled tax payment.
Revenue management automation
- Calculating revenue by product, location, customer contract, customer segment, business entity, etc.
- Automated calculation of total expected contract revenue under each customer contract and its allocation to the separate performance obligations based on their relative SSP.
- Automated revenue recognition according to the up-to-date accounting standards.
Automated reconciliation
- Automated reconciliation of financial data in bank statements with GL, A/P and A/R records.
- Automated removal of duplicate transaction records.
- Automated defining of outstanding transactions and marking them for manual reconciliation by accountants.
- Automated intercompany reconciliation.
Automated financial reporting
- Template-based generation of financial reports (monthly, quarterly, yearly, etc.) by region, entity, or consolidated reports, including:
- Balance sheet.
- Profit and loss statement.
- Statement of changes in equity.
- Cash flow statement.
- Tax summary.
- Revenue recognition report, and more.
- Automated financial report submission to the user-defined governmental entities, financial institutions, the company stockholders, etc.
Key Integrations for Financial Process Automation Software
To ensure maximized automation across financial processes, ScienceSoft recommends that a financial solution should be integrated with the following business-critical systems:
- ERP – for accurate financial planning and budgeting; to consider budget limitations during operational and strategic activities.
- CRM – for the automated input of customer data, payment terms, price and quantity of ordered goods when generating invoices; for the automated calculation and recording of sales revenue in the general ledger, accurate revenue recognition and data-driven revenue forecasting.
- Procurement software – for the automated purchase order recording in the A/P ledger.
- Inventory management software – for accurate recording of inventory values on inventory purchasing and utilization.
- Asset management software – for the automated recording of the fixed asset depreciation.
- HR management software – for the automated payroll calculation.
- Bank accounts – for faster reconciliation.
- Financial data marketplace – for the automated investment portfolio valuation, fair value calculation, building data-driven hedging strategies.
- BI solution – for advanced financial performance analytics and reporting.
Maximized automation of rule-based financial tasks
To eliminate manual efforts across financial processes and free up the financial team for high-value, strategic financial activities.
AI-powered analytics
To predict accurately various financial performance variables and provide the financial team with intelligent recommendations on optimal decisions across financial processes.
User-friendly financial data visualization
To provide well-structured representation of financial data and financial performance patterns for facilitated insights on financial risks and opportunities.
Easy-to-use APIs
To facilitate integration between the solution’s modules and enable smooth connection to other business-critical systems.
Legal compliance
To ensure creation of financial documents and reports in accordance with up-to-date global, country- and industry-specific regulations, such as GAAP (specifically ASC 606 and IFRS 15), SOX, GDPR (for the EU), ZATCA regulations (for Saudi Arabia), and more.
Powerful security capabilities
To ensure the protection of sensitive financial and business data and minimize the risk of malicious user activities with role-based access control, intelligent detection of financial fraud, end-to-end audit trail for all financial activities, and more.
Implementation Costs and Financial Outcomes for Financial Process Automation Software
The cost of financial process automation software implementation varies greatly depending on:
- The type of a solution’s architecture.
- The number and complexity of a solution’s functional modules.
- The degree of automation (implementation of robotic process automation (RPA) and AI-powered features).
- The volume of data that needs to be migrated from the spreadsheets and/or legacy financial software.
- The number and complexity of integrations (e.g., with ERP, CRM, asset management software, an inventory management system, a BI solution), and more.
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Custom financial process automation software of moderate complexity requires $200,000 – $500,000 in investments. A full-fledged solution that enables end-to-end automation of complicated financial processes for global multi-entity enterprises may cost $500,000 – $1,500,000+. Despite the substantial investments, such software can bring 200 – 290% annual ROI. |
Benefits of financial process automation software
Off-the-Shelf Automated Finance Software ScienceSoft Recommends
SAP S/4HANA Cloud Finance
Best for
Large international enterprises that manage complex multi-entity financial processes.
Description
Key strengths:
- AI-powered financial analytics and forecasting.
- Automated multi-book financial close for joint ventures.
- Automated assessment of customer credit ratings for international trade finance management.
Cautions: Costly and complex customization to cover business-specific financial needs.
Features:
- Real-time monitoring of enterprise-wide financial transactions, treasury activities and financial risks, including liquidity risk and customer credit risk.
- Scheduled creation and submission of recurring invoices to customers.
- Automated customer notifications on payment collection.
- Automated processing of purchase invoices.
- Automated multi-department approval workflows for journal entries, invoices, payments, etc.
- Customizable GL account types and reporting segments (e.g., region, product, profit center).
- Automated transaction currency conversions based on the up-to-date exchange rates.
- Automated financial transaction reconciliation.
- Automated revenue recognition in accordance with IFRS 15 or ASC 606.
- Calculations and scheduled payments on lease liabilities.
- Template-based generation of financial reports, including localized and consolidated reports.
- Automated compliance checks against pre-set internal financial management policies.
Pricing
Upon request to the vendor.
Oracle Fusion Cloud Financials
Best for
Large organizations that need to continuously perform comprehensive financial analysis.
Description
Key strengths:
- Multidimensional financial analysis and reporting (by subsidiary, region, product, etc.).
- ML-powered cost and profitability analysis and forecasting.
- AI recommendations on optimal payment dates to avoid penalties or get a discount.
Cautions: Considerable subscription costs for large finance teams.
Features:
- OCR- and AI-enabled capture and validation of data in paper and digital supplier invoices.
- Automated consolidation of financial data across multiple company branches and subsidiaries for multi-entity accounting.
- Automated cash positioning.
- Automated invoicing, including consolidated invoicing.
- Automated allocation of customer payments to open invoices.
- Payment processing templates.
- Scheduled notifications for customers on due payments.
- Automated revenue recognition.
- Automated calculation of recoverable and nonrecoverable taxes, inclusive and exclusive taxes, and withholding invoice taxes.
- Compliance with IFRS 15, IFRS 16, ASC 606, ASC 842, GAAP, SOX, and more.
- Native integration with Oracle Fusion Cloud Enterprise Performance Management and Oracle Fusion ERP Analytics for extended financial planning and budgeting.
Pricing
$600 user/month.
Microsoft Dynamics 365 Finance
Best for
Mid-size and large businesses that operate in multiple currencies or have foreign subsidiaries.
Description
Key strengths:
- Configurable chart of accounts that automatically summarizes GL transactions of multiple subsidiary entities, including those with different fiscal years and currencies.
- AI recommendations on optimal budgets at the enterprise, subsidiary, department level.
- Regulatory compliance covering tax, reporting, audit, and payment format requirements of 43 countries and regions and various industries, including healthcare, manufacturing, banking and finance, and public services.
Cautions: Substantial customization efforts to meet unique financial needs. Limited capabilities for treasury automation.
Features:
- Automated creation of journal entries across business entities.
- Automated invoicing, including recurring, retainer, project invoicing.
- MI-powered cash flow forecasting and predictions on expected payment dates on receivables.
- Automated payment collection via various payment methods, including bills of exchange, cheques, credit cards, EFT, and more.
- Automated revenue recognition under up-to-date accounting standards.
- Automated matching of purchase invoices to purchase orders and product receipts.
- Automated supplier payment proposals.
- Automated reimbursement of employee expenses.
- Automated foreign currency revaluation for open A/R and A/P transactions.
- Automated calculation of depreciation and current value of fixed assets.
- Configurable templates for invoices and financial reports.
- Native integration with Power BI for advanced visualization of financial analytics.
Pricing
$180 user/month ($30 user/month in case a company is already licensed for any other Dynamics 365 app).
You need a financial management solution providing specific functionality to automate your unique financial tasks, e.g., calculating payroll, taxes, employee reimbursement amount or the fair value of assets and liabilities based on custom formulas, creating A/R collection and A/P payment queues based on specific priority rules.
You have large teams involved in financial management and want to avoid a considerable subscription cost for platform-based financial process automation software, which scales with the number of users.
Off-the-shelf automated financial software requires costly and time-consuming integration with your business-critical systems (ERP, CRM, HRMS, asset management, etc.).
You operate in a highly regulated industry (e.g., healthcare, defense, government sector) and need a financial process automation solution to provide advanced tools to protect your sensitive financial and business data.
Ready-made financial solutions don’t provide compliance with local regulations in the regions your company operates.
Automated finance software consulting
- Analysis of financial process automation needs.
- Assessment of the existing financial processes, tools and their integration points.
- Suggesting optimal financial automation features and solution architecture and tech stack.
- Preparing an integration plan (with ERP, CRM, an inventory management system, a BI solution, etc.).
- Implementation cost & time estimates, expected ROI calculation.
Automated finance software implementation
- Financial process automation needs analysis.
- Automated finance solution conceptualization.
- Architecture design for the automated finance solution.
- Financial process automation software development.
- Integrating the solution with the relevant systems (ERP, CRM, an inventory management system, a BI solution, etc.).
- Quality assurance.
- User training.
- Continuous support and evolution (if required).
About ScienceSoft
ScienceSoft is an international IT consulting and software development company headquartered in McKinney, Texas. We provide consultancy and development services to help businesses implement effective automation in finance. Being an ISO 9001 and ISO 27001 certified company, we apply a mature quality management system and guarantee that cooperation with us does not pose any risks to our customers’ data security. If you are interested in getting a robust financial process automation solution, feel free to turn to ScienceSoft’s team.