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In the midst of this unprecedented situation, there is a good chance you’re now faced with a challenge you’ve never even considered before: how to run your accounting department virtually. Is this even possible? Where does one start this transition, and how? One of the first realities I hear from companies is that they are completely unprepared to work without paper at their offices, let alone as a dispersed team. At so many companies, their accounting department is one of the largest remaining areas in their organization that simply can’t do their job without paper.
The most paper-intensive areas within an accounting department remain processing accounts payable and accounts receivable, simply because (at least in the United States) these job functions still depend so heavily on paper checks. (We recently wrote an entire blog series just about paper checks which you can find here). As such, we have been working with our clients to triage their specific situations and help their A/P and A/R focused team members re-structure these functions so they can be done from home.
Because our clients are needing to do this so quickly, we are suggesting some measures that we may not do under normal circumstances. But these are not normal times.
What to do about Accounts Receivable?
Historically and commonly, the Accounts Receivable area is dependent on the delivery of mail. If your company is already using a lockbox service where your customers send payments directly to your bank for immediate deposit and processing, you’ve made a smart move. If you haven’t gotten around to that yet, you need to decide which of your team members will be responsible for processing the daily bank deposit and have your company postal mail temporarily forwarded to their home, using the mail forwarding service provided by the US Postal Service. It can be done online, can take effect immediately, and can be easily and quickly switched back to the company address when you are ready. As an additional measure, sign up for Informed Delivery, which is a USPS service that images the exterior of every letter delivered and provides a daily email of those images so you can see what was delivered.
The team member who receives that mail is then responsible for two things: 1) processing checks received so they are deposited to the bank, and 2) scanning and distributing electronic copies of any other documents received for processing by other team members. Depending on the volume of checks your company receives, you will want to be sure they also take home the check scanner. As another alternative, they could even use your bank’s mobile app to scan and deposit checks.
More than any other function, this adjustment affects how quickly (or slowly) customer payments get deposited to your bank accounts, so make this a top priority to avoid seeing slowdowns in your cash flow and a dwindling bank balance.
