How Competitive Is Your Accounting & Payment Infrastructure? We Asked Tipalti to Help Us Create a Working Checklist

Photo Credit: Abigail Keenan

The global music industry is racing towards $100 billion+ in annual revenues, with success for many businesses defined by their ability to manage extreme complexity. Accounts payable in the music industry now demands a serious financial platform and partners to get it right and get everyone paid on time. But how can you know if your company is getting it right?

To answer this critical make-or-break question, Digital Music News and Tipalti have teamed up to offer a playbook for getting people paid in the music industry—quickly, accurately, and automatically. This definitive pocket guide covers payment issues in the music industry, from startups to enterprise-level platforms. Now, we’re excited to share this resource with the industry.

When it comes to getting payments right, a self-assessment of your business’s current operating procedure is a great place to start. If you’re ready for a diagnostic, then keep reading.

First, the (very) good news. After consulting with Tipalti on this project, we quickly realized that the tools and infrastructure in this realm are in mature state. As a result, they can be deployed relatively quickly and without endless trial-and-error. These are make-or-break details for any music company dealing with complex rights, royalties, and accounting challenges, but they don’t have to ‘break’ anything.

Heading into 2025, Tipalti noted that competitive benchmarks on payments are quickly being established in the music industry. But what are these competitive benchmarks?

For starters, accounting and payment infrastructure should be capturing, accounting for, and paying rights owners for every play on any platform, in any territory worldwide, within 30 days of its occurrence. Your payments infrastructure should be able to handle every type of payment method (PayPal, ACH, eCheck, foreign currency) demanded by rights owners and clients.

However, getting people paid on time and in their preferred currency is the baseline. Does your infrastructure automatically handle all tax concerns, thresholds, and deductions for every U.S. state and territory worldwide? Can it manage complex payouts involving multiple rights owners, splits, disputes, and advances?

Does your payments platform integrate with existing cloud enterprise resource planning (ERP) software like NetSuite, Intacct, Microsoft, SAP, QuickBooks, or others? If not, managing these mandatory details with tens of thousands of payees and clients can add up to thousands of hours of manual labor.

One of the key areas in which many music companies struggle is appropriately identifying and paying every recipient tied to a monetized asset. At a fundamental level, your team should always be able to answer the question, ‘Who are we paying, exactly?’

A key step is to assess whether your accounting and payment infrastructure is industry-level competitive with this checklist. Tipalti provides solutions for each of these instances to create smart, efficient accounting and payments with automated help—does your current solution?

Pop quiz: can you handle the following functionalities with ease?

1. 1. Capturing, accounting for, and paying rights owners for every play, on any platform, in any territory worldwide within 30 days?
   2. Handling every type of payment method demanded by rights owners and clients (PayPal, ACH, eCheck, foreign currency?
   3. Automatically handling all tax concerns, thresholds, and deductions for every U.S. state and territory across the globe?
   4. Managing complex payouts involving multiple rights owners, splits, disputes, and advances?
   5. Tightly integrating your payments platform with existing cloud ERPs or accounting solutions like NetSuite, Intacct, Microsoft, SAP, QuickBooks, and others?
   6. Managing these details with tens of thousands of payees and clients without extensive manual work?

If you can’t definitively answer each of these questions with a resounding yes, then your payment and accounting workflow might need an upgrade.

One impressive takeaway for us during this process: Tipalti was not only capable of handling extreme complexity and hundreds of thousands of payees, but they were also eager to embrace extreme payout quantities via automation. Tipalti’s automation also helps businesses stay tax compliant while keeping payments flowing for rights owners and clients—all while managing complex pay structures to boot.

Link to the source article – https://www.digitalmusicnews.com/2024/12/27/tipalti-competitive-accounting-payments-for-music-industry/

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