Accounting digitization is a crucial issue for finance departments. The transition to a paperless environment makes it possible to automate accounting tasks, trace accounting documents, and secure their archiving. However, the process is not always simple. Digitizing accounting documents is a project that mobilizes several business expertise within the company and is carried out within a framework of accounting and tax rules.

What is accounting digitization?

Digitized accounting, or "paperless accounting," means that all accounting documents are digitized. This includes supporting documents that are scanned upon receipt, such as supplier invoices and expense reports. Customer invoices are issued and sent in electronic format, and all accounting documents and statements are kept and archived in electronic format.

The benefits of accounting digitization

Accounting digitization offers many advantages, both quantifiable and operational. On the one hand, it reduces management costs; for example, the average cost of an invoice goes from €17 to €4 when digitized. It also saves time on accounting processing and document searches.

On the other hand, on the operational side, accounting digitization makes it possible to shorten the deadlines for establishing accounting situations, to better anticipate working capital needs, and to reduce data-entry and paper-handling errors. It also facilitates fraud prevention through the implementation of P2P (Purchase to Pay) processes for the validation and payment of supplier invoices, improves relationships with third parties, customers, and suppliers, and offers the possibility of implementing remote work within the accounting department.

Implementing an accounting digitization project requires the implementation of IT solutions and ensuring compliance with current regulatory texts. Within the company, accounting digitization is carried out at different levels: when documents are recorded, during validation steps, and when accounting documents are archived.

Technical challenges

When recording, it is necessary to implement scanning solutions, such as Automated Document Reading (LAD) or Optical Character Recognition (OCR). The scanned accounting documents are then indexed and classified in an Electronic Document Management (EDM) system. Based on scanned supplier invoices and expense reports, accounting entries are automatically and provisionally generated.

The validation steps, in turn, require modeling validation circuits with workflow tools such as BPM (Business Process Management). It is essential to define who validates each type of accounting document, whether double validation is necessary, and how to manage exceptions and rejections. All stakeholders are notified by the system of pending validations, and the EDM system makes it possible to trace processing progress in real time.

Finally, when archiving, accounting documents and records must be kept in a location that guarantees the origin, authenticity, and integrity of the digital files. These files will need to be presented to the tax administration during audits.

On the legal side, the challenge is to ensure that throughout the accounting digitization process, it is quick to prove the authenticity of accounting documents. It must be possible to trace the audit trail back to the origin of the digitized document, either as a digital document timestamped and electronically signed within the meaning of the European eIDAS regulation, or to trace, via the EDM system, all stakeholders involved with the document back to the source — the source being a business software application of the company or the scanned paper document. Finally, it is essential to archive documents in an Electronic Archiving System (SAE).

How to implement accounting digitization?

Implementing accounting digitization requires careful planning and organization. Here are some key steps for successful implementation:

1. Analyze existing accounting processes

It is important to understand how your accounting processes currently work. Which documents are processed? How are they stored and managed? What are the current pain points? This analysis will help identify areas where digitization can deliver the most value.

2. Identify the appropriate tools

Accounting digitization requires the use of various technological tools, such as scanning solutions, EDM software, BPM tools, and others. It is essential to choose tools that match your company's specific needs and that can easily integrate with your existing processes.

3. Train employees

Accounting digitization involves a major change in how employees work. It is therefore crucial to train them on the new tools and processes. This may include online training, workshops, Q&A sessions, and others.

4. Implement change management

In addition to training, it is important to manage change at the organizational level. This may involve regular communications about the benefits of digitization, recognition and rewards for employees who quickly adopt new processes, and proactive resolution of issues that may arise.

5. Ensure regulatory compliance

As mentioned above, accounting digitization must comply with current regulatory texts. It is therefore essential to work with legal experts to ensure that all aspects of the process comply with regulations.

What is the future of accounting digitization?

With the rapid evolution of technology, the future of accounting digitization is promising. We can expect to see new technological advances that will make the process even more efficient and easy to use.

For example, artificial intelligence and machine learning can be used to further automate the processing of accounting documents, reduce errors, and improve accuracy. Blockchain technologies could also be used to improve the security and traceability of accounting transactions.

Conclusion

Accounting digitization represents a major opportunity for companies to gain in efficiency and compliance. However, it also involves technical and legal challenges that require appropriate expertise. By understanding these challenges and implementing best practices, companies can successfully transition to digitized accounting and reap the benefits.

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