6 Accounts Receivable Automation Best Practices

Cash flow management remains a top priority for CFOs heading into 2026 – and they are leaning into accounts receivable (AR) automation benefits to make it happen.

Overdue invoices are straining AR performance, with nearly 90% of businesses saying some 30% of invoices are paid late. For companies extending payments beyond 30 days, that translates to an average 4.6% of revenue – some $19 million – lost to payment uncertainty (PYMNTS From Friction to Flow: AR Automation in 2025).

To close the gap, top-performing finance teams are embracing automation to accelerate collections, improve visibility, and boost cash flow.  

But despite rising investments, achieving a successful AR transformation remains a challenge. Nearly 65% of CFOs don’t feel confident they can realize meaningful value from their AI programs (Gartner 2026 CFO Agenda).  

Only 27% say their technology strategy is fully aligned with business goals, underscoring the need for a clearer roadmap and stronger execution (Grant Thornton’s 2025 Shift Your Tech Strategy Report).  

To help you overcome these obstacles and maximize accounts receivable automation benefits, we’ve outlined the strategies and best practices used by high-performing AR teams.

6 accounts receivable automation best practices that drive success 

With most finance organizations struggling to achieve meaningful returns from their automation investments, turning potential into performance takes more than technology — it requires clear strategy, disciplined execution, and process excellence. Here’s how to get it right: 

1. Assess your current AR workflows 

Too often, teams skip straight to AI and automation tools without first mapping processes or aligning stakeholders.  

Here’s how you can do better: Start by identifying bottlenecks, repetitive tasks, and gaps in your current AR workflows. Audit records to catch unreconciled payments and prevent automation misfires, such as sending reminders for invoices that have been paid but not reconciled.  

Document each step from invoice creation to reconciliation. Map out each step, note the time required, who’s involved, and where delays or handoffs occur. This documentation not only exposes operational gaps but also serves as your baseline for measuring automation success and refining your future-state strategy — ensuring automation enhances your process, not just digitizes its flaws.  

2. Standardize workflows such as invoice & dispute processes 

Before rollout, align with teams like sales, IT, and customer service to design automation rules that reflect actual business needs. Use workflow maps to set logic and business rules — like auto-generating invoices when orders ship or escalating overdue accounts based on invoice age and value.   

Focus on key areas such as consistent invoice formats, clear cash application rules, structured remittance guidance, standardized dispute codes and escalation paths, templated customer communications, and formalized credit policies. 

3. Start with high-impact, easy-to-automate areas  

Avoid tackling everything at once. Begin with high-ROI, easy-to-automate, low-complexity tasks such as invoice generation, payment reminders or proactive collection emails, then expand to more advanced areas like consolidated billing or dispute resolution after early wins.  

Use pilot tests to introduce AI in controlled AR segments. Choose processes that are valuable but manageable, such as invoice processing, expense report management, or basic reconciliations—so you identify issues early, adjust, and build confidence before scaling. 

4. Automate deductions management 

Deductions management is a critical but often overlooked part of the O2C process. Poorly managed deductions drain resources, create cash flow gaps, frustrate customers, and directly impact profitability.  

Automating deduction processes with bots or specialized tools helps reduce backlogs, reclaim lost revenue, and ease team workload, especially with high-volume customers like Walmart or Target. 

Standardize reason codes, root-cause tracking, and escalation paths to speed up resolutions and reduce manual errors. Automation within leading ERP systems like SAP, Oracle, or NetSuite can route claims to the right team instantly, cutting time-to-resolution and eliminating email chains.  

5. Choose the right accounts receivable automation software 

The best AR automation tools align with your goals, budget, and existing systems. While platforms like HighRadius offer end-to-end capabilities, many teams overpay for features they don’t use.  

If you already have a strong ERP foundation, layering targeted automation — like UiPath for payment matching or PDF extraction — can be a smarter, lower-cost option.  

Whichever path you choose, integration is critical. Your AR automation tool must sync seamlessly with your ERP and banking systems to avoid creating new silos and manual work. Prioritize strong API connectivity, real-time syncing, and enterprise-grade security features like encryption and access controls.  

Look for collaboration features that let finance, sales, and customer success teams share dashboards and resolve issues faster. Also, involve your AR team early to ensure the AR solution fits day-to-day operations.  

Platforms like UiPath that combine AI and RPA deliver intelligent data extraction, predictive insights, and adaptive processing, offering the scalability and adaptability needed to future-proof your AR process.  

It’s also important to fully assess the extended functionality already available in your core platforms before layering new automation tools. 

For example, Auxis is helping a transportation client modernize a highly manual billing process built on the Oracle ERP. The company’s invoicing process typically requires multiple spreadsheets and constant back-and-forth with operations to gather usage data and contract details.  

Auxis is helping the client explore implementation of Oracle’s subscription management module to automate complex contract rules, usage-based billing, and monthly calculations. Here’s how the new process would work: 

6. Regularly track performance metrics 

Consistently tracking key AR metrics like DSO, aging buckets, dispute resolution time, collection effectiveness, and the frequency of manual intervention helps spot trends and issues early and refine workflows. Set clear baselines before implementing AI and automation, then evaluate progress monthly to catch gaps in performance.  

If DSO remains high or disputes increase, it may be time to recalibrate workflows or automation logic. Redeploy AR resources to focus on reconciliations, verify customer contact details, and clear unapplied cash. Top AR tools can also flag outliers and send alerts when metrics drift, helping you stay ahead of problems before they escalate.  

For organizations that outsource AR operations, partners like Auxis enhance this visibility even further by providing monthly performance reviews and connected Power BI dashboards developed at no additional cost, to track KPIs and SLAs in real time. This level of transparency helps CFOs improve accountability while reducing operational cost.  

Why Auxis: Maximize the value of your AR automation journey 

AR automation transforms finance into a true growth driver — accelerating cash flow, reducing DSO, and freeing teams for higher-value work. But many organizations lack the time or expertise to identify the best use cases and implement AR automation effectively. 

Not surprisingly, a remarkable 81% of finance functions are adopting or planning to adopt AI as part of their outsourced accounts receivable services (Deloitte’s latest Global Outsourcing Survey). The reason is clear: achieving real results with AI and automation requires more than technology alone. By partnering with high-quality outsourcing providers, organizations gain access to the talent, tools, and process excellence needed to turn AI investments into lasting performance.   

Now powered by Grant Thornton, the fifth-largest accounting and advisory firm worldwide, Auxis brings a century of finance expertise, proven AR best practices, and end-to-end AI and automation capabilities as a UiPath Partner of the Year and Agentic Automation Fast Track Partner. Named a top finance and accounting outsourcing company globally by leading research analysts like Everest Group and ISG, Auxis is consistently recognized for its world-class, tech-enabled nearshore delivery model that combines top-tier finance talent with process optimization and digital transformation — with the ability to expand globally as your business demands.  

From assessment and strategy to implementation and nearshore support, Auxis helps clients avoid common pitfalls like tool overload, integration gaps, and lack of in-house skills, ensuring they achieve the full benefits of a modern AR organization. 

Ready to transform your collections process with AR automation or outsourcing? Schedule a consultation with our accounts receivable team today, or explore our learning center for more AR tips, insights, and best practices. 

Frequently Asked Questions