Listen: How AI-powered automation can streamline financial reporting

Businesses looking for quick credit-decisioning can benefit from financial reporting that gives banks a clear picture of data. Lenders “need a simplified and accurate way to receive financial reports so they can make decisions,” Sid Saxena, chief executive of artificial intelligence (AI)-powered accounting automation platform Docyt , tells Bank Automation News in this episode of “The Buzz” podcast. The Sunnyvale, Calif.-based Docyt offers a solution that allows small businesses to clean up their financial reporting and reallocate back-office human resources, Saxena says, noting that when businesses have the ability to automate their financials, lenders gain access to faster and more efficient decisioning. “When lenders look at Docyt, one of the ways [we] can help is cleaning up past bad accounting in a matter of hours and days instead of months,” he tells BAN . The automated platform also boosts the use of technology at small businesses which helps them to better delegate employee resources, Saxena says. Similarly, Oklahoma-based Grand Savings Bank and Liberty National Bank are leveraging Teslar Software’s automated system to speed up workflows without the need for additional personnel. Listen as Saxena discusses Docyt technology, its integration and how lenders can benefit from automated accounting to streamline decision-making. Bank Automation Summit Fall 2022, taking place Sept. 19-20 in Seattle, is a crucial event on automation and automation technology in banking. Learn more and register for Bank Automation Summit Fall 2022 . Subscribe to The Buzz Podcast on iTunes , Spotify , Google podcast , or download the episode .

The following is a transcript generated by AI technology that has been lightly edited but still contains errors. Whitney McDonald 00:07 Hello, and welcome to the buzz of bank automation news podcast. My name is Whitney McDonald and I'm the deputy editor for bank automation news. I'm joined by Sid Saxena, chief executive at accounting automation platform Docyt, he discussed how to make the most of accounting automation in today's labor shortage, specifically how to use integrated solutions to make up for short staffed back of office.00:32 Once again, thank you for taking the time out to talk to me, me and my now co founders, we explore the space, we realize that small business back office is one of the most challenging environments to operate. And this is partly because of affordability constraints partly because of labor shortage. But automation in the back office still remains the hardest problem in finance. So we started docket to really take this challenge head on. So docket is a digital back office. It automates budgeting bill payments and expense side of workflows and our business typically has this kind of control is important so that the business can really control its cost. docket also has a revenue tracking engine. businesses owned their revenue in various ways. So they also need to track every penny of either earned or miss revenue. Missed revenue is really the most difficult thing because it immediately impacts the profitability. When you think of accounting, ultimately, there is a process called reconciliation, which is where the financial reporting finalization happens. So all of these processes, docket can automate, there is AI inside the software, which essentially means that this automation doesn't need too much of human involvement. So as a digital automated back office, docket can really produce live financial reporting for our business.Whitney McDonald 02:09 Three, and now I know that today, especially labor shortages are definitely top of mind, wondering if you can kind of talk about how small businesses can leverage this type of automation, and this technology to make up for those lack of human resources?02:28 Absolutely, you're absolutely right. You know, labor shortage really is becoming critical for the business owners. And one of the things that we are seeing is, because of the shortage of personnel, business owners are spending more and more time behind the counter, or in the back office, which means, you know, all of this comes at the cost of personal and family time. This also limits the scale of operations and future growth of business. Once a business starts adopting technology in the back office, the biggest help that the business gets is their managers are liberated to really focus on improving profitability. They no longer have to do paper pushing, they no longer have to manually write checks to their vendors and suppliers, they no longer have to figure out whether they have cash or how to manage their cash flow. All of this is done by the software. If you think about the process of producing monthly financial statements, it's a little bit like climbing a mountain. As soon as you reach the peak, you realize that the month has ended, and you are pushed down back to the base camp. And now you have to climb that mountain again, and this is relentless. Month after month be Thanksgiving, Christmas, no matter what time is it, you have to work on all of this stuff. And the hard work spent on creating these financial reports is all wasted if the business owner really has no time to review these reports, and think about ways to improve operational efficiency or the profitability of the business. So automated accounting, the ultimate benefit that it provides is bringing this stuff at the fingertips of the business owner and make it real time. So that decision making for the managers and business owners can really happen at a much faster pace. Whitney McDonald 04:31 Well, thank you for explaining how it works, what the benefits are, if you don't mind getting into the nitty gritty of the technology itself. I know that you said the use of AI but if you can explain what the integration looks like, and exactly how the technology works to automate these processes, I think that would be helpful. 04:50 So to again, talk about this in a slightly different way. The back office of a business is an extremely data rich environment. A lot of paper, and digital files come at the business owner. Now this is connected to all the financial transactions that are coming in your bank and credit cards. But if you just look at the transactional data, you miss out on the richness that's often available inside these actual documents like receipts, bills, invoices, and reports coming out of your point of sale system. So when we were thinking of building docket, we really made it into a data engine that can absorb all of this data, doesn't matter the kind of shape and form it comes in. All you do as a business, is just dump all this data inside docket, the system tries to understand extracts information, and presents to the decision makers in a format where they can take action on it. Whitney McDonald 05:52 I know just from our own coverage, that this is something that banks and financial institutions specifically are looking into, especially as employees are harder to come by, like you said, not only because they're hard to find, but it's expensive to hire people right now. So I think it'd be good to walk through maybe what feedback you're hearing, who's using this platform, or program, something along those lines? 06:19 Absolutely. As I was saying earlier, you know, relationship are really a deep and critical part of running a business. And General Ledger really owns and keeps these relationships. Employees are connected to the back office, through their payroll. Your general managers need budgets and targets to really make the business profitable. The business partners and owners really need the financial reports to come to them on a timely basis. And when lenders are involved, before they can make lending decisions, they really need a simplified and accurate way to receive these financial reports so that they can make lending decisions. So in many ways, all of these different individuals are connected to a system like docket. If you have managers who need to pay suppliers, then these managers use our bill pay features expense side of things. The business owners really usually look at dashboards and financial reporting. And when it comes to live dashboards, you can also invite your lenders to review finalized and reconcile financial statements so that whatever lending requirements that are in place are met the obligations of the business are met. What we saw during the COVID crisis was businesses that really were using automation in the back office, they were able to apply for government grants and PPP loans on a timely basis, which really helped during this crazy critical time. And these businesses were the first ones which received these loans. And they essentially were able to survive and provide employment during this difficult time. So essentially, when lenders look at docket, one of the ways in docket can help is cleaning up the past bad accounting. In a matter of hours and days, instead of months, we have had customers who have done automated financial statement creation in a matter of few hours, for the past two years of data. So all of this is really groundbreaking stuff, which brings the business financials in front of the decision makers make it really crisp and clear for them to understand what's going on. And the lenders can make quick decisions on how much liquidity to provide to the business. And they can make these decisions much more faster. Whitney McDonald 09:00 Yeah, very interesting. And I heard you just kind of quantify the amount of time saving that you're actually seeing with this automation in place. I also appreciate you going through those who implemented these systems during the pandemic, how much time and resources were allocated to implementing these systems. And they weren't just a quick fix. These are something that people are holding on to still integrating still finding an automated system that works best for them on their platform. Um, one thing I wanted to get your opinion on, that I've been hearing just through other conversations is some businesses implementing this not as a way to replace employees, but they're able to reallocate employees to other aspects of the business. Can you kind of talk through how that's a possibility with these, with this technology in place? 10:00 Absolutely, I think that's a very important point. When you are running a small business, your team is everything that you have. And you don't want to bring in technology to replace your team. You have these critical members of your organization who almost are like your family members. But you also have to scale your business. So businesses that bring in technology and automation, they think of how they can repurpose the human workforce that is available to them, so that their workforce is also motivated, they are not doing mundane grunt work. And these folks can really be productive contributors to the profitability of their business. Any employee of a small business or general manager that you talk to, all of them want their business to succeed. All of them want the business to become profitable, because they know ultimately, it's in the best interest of every person involved, then automation comes in. The most important benefit that immediately businesses gets his software works when people are still eating and sleeping. Your bills are relentless. Bills will keep on coming, be it Thanksgiving or Christmas. So the automation also is relentlessly working for you. Another important advantage that automation systems bring in as business processes get codified into the software. Usually, some part of running the back office or some other elements stays in the brain of an individual, which is not the right way to run or scale a business. But when software is managing a lot of these processes, these processes get codified. And you never make a mistake in either paying a vendor or keeping track of things. Most business owners also want to scale their operations, you know, no business owner ever said that I am happy with one location. Everybody wants to have a second location or fifth location and increase the scale of their operations. And this can only be done in number one, ensuring that your workforce is happy, they are not doing grunt work, they are paid on time. And number two, automation and software is brought in so that the financial profitability of every location can be ensured. So ultimately, the benefit goes on to all their business relationships to all the workforce, the contractors, the suppliers and vendors that you have, and everybody events. Whitney McDonald 12:52 Perfect. Um, is there anything that you wanted to talk through that I didn't bring up through a question that that you wanted to be sure to mention? 13:05 I would love to talk for a little bit of time about this thing called the General Ledger, you know, a general ledger. Think of it as a simple Excel spreadsheet or a register. In olden days before tech came in, people literally had a ledger or register, where they would note every item that was income or expense or lending loan, and at the end of the month or quarter, somebody would balance out the register. Now, if you think a little bit deeply, every vendor, every customer, your employees, your products, supplies, inventory, even government relationships in the form of tax and licenses, these are all reflected in the accounting general ledger. So this one little thing is at the core of all business relationships. People often do not understand the depth of information that exists in the general ledger. Now due to all sorts of regulations, the human resource to balance these books and Ledger's is becoming more and more expensive. The work involved here is actually very mundane and formulaic. So software systems and automation systems are really good at understanding this data. This is the perfect space where back office automation can come in and make the business competitive. So the way docket system works is v have workflows at the top of our software. Imagine bill payments. So hundreds of your vendors are sending you paper bills, emails, database attachments, all you do is send that data into docket. The automation does the heavy lifting of extracting the data understanding who sent the bill. Is it even a genuine vendor is a duplicate bill and provides this information in our E easy to use format. The business owners or approvers can approve the bills and that one tap using your mobile phone no matter where you are in the world, you can pay your bills. But docket goes one step further. Bill Payment actually triggers a bunch of accounting processes underneath, which often falls down on the shoulders of an accountant or a bookkeeper. accrual basis accounting or bringing your financial statements to GAAP levels standards really involve a lot of heavy lifting. But software like docket can actually bring in those accounting processes. And in real time, as you're paying your bills, it understands how to account for it as well. So for companies to have a tight control on their own budgets and operational expenditures is extremely important, especially even in tech segment. Vianna completely changed landscape right now. And the businesses of the future are going to be the ones which adopt better technology in their back office, which really look at their financial reporting in a live manner, and which are able to make these rapid decisions. As the landscape changes in front of them rapidly. We saw how in just the last two years, a pandemic came, too much of money through quantitative easing came and then all of a sudden too much of inflation came and then now the quantitative tightening by the Federal Reserve came. These kinds of things were supposed to happen once a decade. Now they're happening once in 234 quarters. So businesses have to be extremely fragile in these challenging times and having these automation and these digital back office is going to help them more and more in such an environment. Whitney McDonald 17:00 You've been listening to the buzz, a bank automation news podcast, please follow us on Twitter and LinkedIn. And as a reminder, you can rate this podcast on your platform of choice. Thank you for your time and be sure to visit us at Bank automation news.com For more automation news 37:00 You've been listening to the buzz

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