The Benefits of OCR Technology in Finance and Accounting

Posted by Infinit Accounting on Jul 28, 2017 12:42:06 AM

Topics: Finance & Accounting

The world has already embraced the benefits of digitized processes and products. Smartphones are most individuals’ tools for everything from grabbing a ride, paying bills, sending work documents, to daily communication. Government offices schedule appointments and have applications done on their websites.

Digitizing records saves both time and paper. Archiving is done much faster and placed in a larger storage space. Access is more practical and efficient, making information easy to search and share among relevant parties.

Finance and accounting would benefit greatly from digitizing products and process. Optical character recognition (OCR) can scan documents and images, converting them to files in different formats. The technology lets accountants and financial analysts focus on the more specialized aspects of their jobs, leaving the routine tasks of deciphering old receipts and statements to computers.

More and more accountants are performing higher skills, rather than the manual ones most did during the analog age.  OCR will help accountants and analysts focus on the more technical aspects of their jobs while also introducing more accuracy and precision into mechanical tasks. Here are some benefits in using optical character recognition in any finance endeavor.

Better Auditing and Reporting on Expenses

Financial advisory firm Stout Risius Ross reports that businesses spend more than $1B in fraudulent expense reimbursement costs. Some instances include blank receipts from cab drivers, blank receipts on non-business transactions and adding more to the actual expense, double receipts from restaurants and hotels, and other means of adding fraudulent charges into business expenses.

OCR management can avoid and stop these types of reports. For instance, you can require staff to use a mobile-device to capture their receipts in real time. The new protocol using OCR will force employees to stop reporting fraudulent expenses.

Optical character recognition in finance will also benefit auditors when they go through these expense reports. Audits can be conducted with better depth and faster turnover, providing auditors an easier search through expense documents and budget reports. The auditor can spend more time analyzing the transaction details rather than just collating and reporting each one as is.

Faster Processing of Accounts Payable

Human beings are prone to error. It takes time and practice before one can thoroughly manually enter data for records. The task itself is repetitive and tired eyes or hands will lead to more errors. If employees need to input massive amounts of data, the company ends up spending more on overtime and overhead costs like electricity.

OCR technology introduces improved efficiency by doing these things faster and with greater precision and accuracy.  At the same time, the business spends less on operational costs and labor expenses on employees. Employees can focus on resting after hours and devoting office hours to specialized tasks. Streamlining invoice processes for payables records is the first step to better accounting. The OCR would work by going through a volume of invoices from several suppliers or vendors. From here, they can configure the invoice formats and establish relevant data.

Other OCR technologies have a thorough step-by-step process. A good program can have the invoices from different sources move towards one destination, regardless of the form. Automated classification algorithms are used to recognize the information and organize them accordingly. Data can be extracted rapidly from each field indicated; numbers are validated in a faster process based on calculations and database. All information can be verified using an intuitive operator interface to assure accuracy. Gathered data is stored as searchable PDFs staff can easily refer to in the future.

Improved Payment Processing

Structured documents can also be interpreted by OCR technologies. They’re usually able to decipher key data found on a static layout, letting you perform tasks such as depositing checks using your phone. There’s no need to go all the way to your bank, line up, and wait an hour or so to process a check. If your bank’s app uses OCR, you can just take a photo and the check amount will be found in your account in no time.

Absorbing All Kinds of Information

Apart from receipts, transactions, and checks, OCR can read through long texts on books and presentations. More developed technologies can even analyze handwriting, making meeting notes and information collation faster after important gatherings.

For long texts, OCR can scan printed documents and convert each line into searchable, editable and selectable live text. There’s no need for you to manually retype each sentence while you write reports or disseminate the information. You also avoid inaccuracy in terms of spelling and flow.

Soft copies of each document will also be part of the system’s archive. There’s no need to worry about allotting enough office space for thick books and the paper settling dust over the years.

Small but Significant Benefits

Apart from converting information into accessible files, users are free to download what they need into their laptops, computers, and smartphones. Accessibility answers storage and compatibility, letting auditors, analysts, and accountants work remotely or from the comforts of their preferred device. There’s no need to worry about misreading the information or being unable to work with it on a business trip abroad.

Having a capable and experienced OCR provider will assure your company each stated benefit. You look forward to more efficient operations, cost saving solutions, and focus on employees. But you need the right OCR partner to make sure the information is safe and only kept among relevant partners. Outside access to delicate financial information could compromise any client relations or projects you’re currently working on.

Infinit-O has excelled in providing outsourcing services in finance and accounting. If you’re looking into solutions, Infinit Accounting has the expertise to get you started and provide this specific service. The company’s credentials include Six Sigma Certification, ISO 9001:2008, ISO 27001:2013, compliance with HIPAA and Sarbanes-Oxley. Given the specificities of OCR, you need a provider that truly understands the technology and assure expertise. Infinit Accounting is sure to offer these, particularly at a feasible cost. Contact us to learn more.

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