Education Week reports that K-12 schools are experiencing a “perfect financial storm” in 2023, stretching already tight resources. As economic conditions force schools to consider layoffs amidst teacher shortages, administrative staff, including financial departments, are bearing the brunt.
Schools must invest in automation technology to help financial staff do more with less. In this piece, we’ll address five trends currently impacting K-12 schools and share how automating financial operations can help.
1. Electronic Payments Grow in Popularity
Americans are embracing digital payments. McKinsey reports that 82% performed a digital payment in 2022 – up from 78% in 2021. This includes person-to-person payments via apps like Venmo and mobile payments using platforms like Apple Pay.
With digital payments becoming more pervasive outside of work, financial staff expect that same convenience in their professional roles. Accounts payable (AP) automation allows your financial teams to pay bills in a similar, simplified fashion.
2. Schools Experience Reduced Funding
This year, COVID-19 relief funds start to expire. The federal government ended its free school lunch program. And inflation is driving up employee compensation and facility maintenance costs. With threats of a looming recession, important programs may be slashed, and people may lose their jobs.
Schools are preparing for potential cuts and tightened budgets. Automation technologies can help streamline financial operations; staff can work more efficiently when they don’t have to spend time on tedious manual tasks.
3. Organizations Focus on Digitizing Processes
Many schools use manual processes and old-fashioned tools like Excel spreadsheets and paper checks to handle accounts payable. Organizations of all types are prioritizing digital transformation, and it’s time for schools to do the same.
Automation tools let finance departments save time, cut costs and avoid human errors. Additionally, they ease report generation, tax compliance and auditing.
4. Data Security Remains a Concern
Organizations that rely on outdated manual processes for financial transactions are exposed to more security risks. This is especially true as hybrid work and learning become the norm.
To protect against cyberattacks and data theft, school systems must adopt technologies with strong internal controls, cybersecurity monitoring and data encryption.
5. Departments Must Focus on Strategy
Financial teams are tasked with delivering data analysis to ensure schools are operating as efficiently as possible. Accurate real-time data reporting is impossible with manual tools and processes.
Automated digital tools reduce time-consuming tasks so finance teams can focus on more strategic initiatives like analyzing spending to find ways to save. These tools also provide greater visibility so financial teams can make better decisions backed by data.
AP Automation Benefits for K-12 Schools
Schools will experience significant improvements by adopting AP automation software, especially in their financial departments. Finding a solution that integrates with your existing accounting system is crucial to maximizing benefits, including:
- Time savings: Automation lets your team work smarter, not harder.
- Cost savings: AP automation software saves more than $7 per invoice on vendor invoice processing. It also reduces labor costs.
- Better security: Electronic transactions and processing are more secure than legacy systems. They feature enhanced controls and data encryption.
- Increased visibility: Automation tools give insights and transparency into data flows between systems, plus they provide enhanced reporting for analytics.
AvidXchange is now integrated with the MIP Fund Accounting platform to help K-12 schools bring automation into their financial operations. Read more about how they work together to streamline your organization’s financial processes.