optimising reconciliation and cash applications in complex shared services environments
DESCRIPTION
In this presentation, AutoRek and IBM examine why shared services organisations are complex places to manage, and how to optimise financial reconciliations and cash applications so that your shared services operation can run more smoothly and to greater effect. Most shared services organisations are complex places to manage. Either the systems landscape are not as simple as you would like or the many business lines you have to service are layered with complexities. In this excellent webinar we look at how to optimise financial reconciliations and cash applications so that your shared services operation can run more smoothly and to greater effect. In this webinar, AutoRek and IBM examine particular implementation examples and looking in detail at how to: Address inter-company mis-matches Ensure that your balances are reconciled and contain no surprises Ensure you comply with different accounting policies Attain a greater level of consistent management information Get more out of your ERP Increase the volumes of business your SSC can process without incurring extra costsTRANSCRIPT
Optimising Reconciliation and Cash Applications in Complex Shared Services Environments
Jim Muir – Director at AutoRekTim Klepp - Order-to-Cash Process Leader at IBM
Introduction
•Welcome•About your host•sharedserviceslink.com
How this session works?
How this session works
•Technical support•Questions!
Today’s Agenda
Introduction Products and Services for Shared Services Centres Delivering the Business Case Case Study 1: Re-Engineering of a Major Insurance Shared Service Centre
Tim Klepp - Order-to-Cash Process Leader at IBM
About IBM IBM’s Order-to-Cash Solution - Tim Klepp Case Study 2: AutoRek Cash Apps Process – One Client Experience
Summary and Q&A
Poll Question 1
I have signed up for today’s webinar because...
My reconciliations are manual and taking too long
My reconciliations cost too much to prepare/require write offs
I am reviewing our fast close procedures
We are considering outsourcing/ insourcing and want to understand what controls AutoRek provides in that process/journey?
Our credit control is adversely impacted by the time it takes to identify and post receipts
Introduction
AutoRek financial management software has an outstanding pedigree in blue chip organisations.
Working with Shared Service Operations we developed capabilities and solutions to address the challenges around data management ranging from high volume reconciliations and data migration to automated cash allocation of receivables and vendor statement reconciliations.
The next few slides outline what we do, how we do it, and the irresistible business case for deploying AutoRek in “complex shared services environments”.
Lowering Costs
Improving Processes
AutoRek
Reducing Risk
Control Stabilise Improve
Blue chip international client base
AutoRek first launched 1998
Reconciliations, Cash Applications and Attestation on the same platform
Preferred tool of leading F&A BPO provider
Partner of leading consultancies
Microsoft Gold Partner
Main offices: Glasgow, London
Dat
a M
anag
emen
t C
on
sult
ing
Ser
vice
s
AutoRekReconciliations
VanguARdOrder to Cash
Cash Applications
ReKlaimDuplicate Payments
and Invoice Processing
Performance Management and Reporting
Products and Services
ReKognizeAccount
Attestation
Dat
a M
anag
emen
t C
on
sult
ing
Ser
vice
s
AutoRekReconciliations
VanguARdOrder to Cash
Cash Applications
ReKlaimDuplicate Payments
and Invoice Processing
Performance Management and Reporting
Products and Services
ReKognizeAccount
Attestation
Dat
a M
anag
emen
t C
on
sult
ing
Ser
vice
s
AutoRekReconciliations
VanguARdOrder to Cash
Cash Applications
ReKlaimDuplicate Payments
and Invoice Processing
Performance Management and Reporting
Products and Services
ReKognizeAccount
Attestation
Dat
a M
anag
emen
t C
on
sult
ing
Ser
vice
s
AutoRekReconciliations
VanguARdOrder to Cash
Cash Applications
ReKlaimDuplicate Payments
and Invoice Processing
Performance Management and Reporting
Products and Services
ReKognizeAccount
Attestation
Dat
a M
anag
emen
t C
on
sult
ing
Ser
vice
s
AutoRekReconciliations
VanguARdOrder to Cash
Cash Applications
ReKlaimDuplicate Payments
and Invoice Processing
Performance Management and Reporting
Products and Services
ReKognizeAccount
Attestation
Delivering the Business CaseSource
Explode
Enrich
Match
Escalate
Identify
Classify
Escalate
Remediate
Measure
RelativeFTE
Audit
Reporting & Escalation
Exception management Shared Services
Intercompany
Balance Sheet
Cash Allocation
Supplier Statements
Cost Reduction
Increasing Capacity
Reduce Risk
Improved Visibility
Fast Close
Consolidation
Mergers/Acquisitions
De-mergers/Disposals
Outsourcing
Data Migration
Attestation
Suspense Accounts
Poll Question 2
What level of automation (no manual matching of payments to open invoices) exists in cash allocations today?
None
1 to 25%
26 to 50%
51 to 75%
Over 76%
AutoRek Case Study27th October 2011
Re-Engineering of a Major Insurance Shared Service Centre
The client had implemented a new Finance system in a short timescale in a Shared Services Centre on a tight budget but reconciliations with the legacy administration systems had not been performed properly due to:
Inconsistent data mapping
No definitions of accounts
Rigid charts of accounts
Loss of audit trail
No sub-ledgers supporting a thin general ledger
Legacy system data issues and robustness
• The Finance function was under-staffed, under-trained and knowledge rested with a few longer serving staff
• Financial reporting was slow (35 days after month end) and prone to error without any “drill down capability” to determine reasons for variances month on month, year on year, division on division or from budget/plan.
• Operational management information was out of synch and inconsistent with financial information
• System fixes and requests were not properly analysed, specified, evaluated and prioritised
• Legacy systems did not interface and there was over reliance on end user computing for reporting and analysis
The Challenge
Reconciliations were defined and built for every nominal ledger account in the balance sheet and every bank account in every division
The higher transaction volume reconciliations were put onto AutoRek which was directly interfaced to client systems
An intranet site was established for KPIs, Training, Procedures, MI, systems requests, staff whereabouts and other key communications and templates
A data warehouse solution was bought to allow drill-down from general ledgers into sub-ledgers and operational systems to allow detective and predictive MI on Finance and Operational matters.
New separate entities became fully accountable for P&L and Balance Sheets. No accounts were shared.
New systems prioritisation procedures put in place
The Solution
Fully auditable and explicable numbers
Faster MI and Financial results
Elimination of root cause accounting error
New automated interfaces from legacy systems
Clearer roles and responsibilities for staff
Increased accountability for performance across the whole business
The Benefits
October 27, 2011
Autorek Discussion Document: IBM Cash Apps Experience
© 2011 IBM Corporation
19
IBM’s delivery model allows us to provide off-shore, near-shore and on-shore solutions, and to create the mix that suits our clients.
ST. JOHN
TORONTO
TULSA
DURHAM BEAVERTON
BOULDER
TUCSON
SAN JOSE DALEVILLE
GREENVILLE BRATISLAVA
BRAGA
DUBLIN
CAIRO
BUENOS AIRES
MUMBAI
CHANDIGARH
SHANGHAI
PUNE
KOLKATA
VIZAG
BRISBANE
OKINAWA
TOKYO
SAPPORO
JEONJU
BALLARAT MONTEVIDEO
FREETOWN
ANTANANARIVO
KAMPALA
F&AHRSCMCRMIndustry-specific
HORTOLANDIA BANGALORE
TAUNTON
SWANSEA
GREENOCK
KRAKOW
COVENTRY
BUDAPEST
SOFIA
DELHI
CHENNAI
MANILA
DALIAN
F&A and SCM Global Delivery Centers 20+ delivery centers globally 40+ languages supported 60+ countries supported
© 2011 IBM Corporation
20
Key Highlights:
Serving the largest & most innovative global companies
Full suite offering across - 20 delivery centres, 18 languages, 60 countries worldwide; approximately 85% of services delivered from off-shore locations
Managing ~$75 billion in client revenues, ~40% US-based & 60% European-based
Wide spectrum of specialist Tools & Technologies to enable the collection process
Management team with deep industry and process expertise
Committed cost savings and efficiencies - up to 60%
ReportingCash Application
Dispute Management
CashCollection Billing
Credit Management
Order Entry
Global Delivery Capability
Specialist Tools
High Level Process
IBM delivers a comprehensive O2C solution that is global in scope and enabled by technology and analytics
© 2011 IBM Corporation
2121
We support end-to-end O2C processes with over 2,600 O2C specialists serving more than 20 clients
© 2011 IBM Corporation
22
Typical issues in manual cash application processing
- High level of staffing required to handle intensive manual processing
- Working capital and customer service issues due to time lag / backlog of unapplied cash
- Customer service and audit issues due to misapplied payments
- Profit and loss impact of poor management of deductions
- Poor matching rates
- Poor traceability and audit
© 2011 IBM Corporation
23
Common tool and process for all clients
– Able to create factory across deals to maximise resource
– Reduced transition costs
Match single remittance across several ERPs
Payments can be applied across more than one entity
Enhanced matching capability in tool – more items auto matched
Auto matching can take place outside working hours
Seeking ability to drive productivity upwards of 40%
Autorek has been a strong fit for our goals
Key Objectives
Strong reputation for creating and supporting automated solutions with rapid ROI
Wide base of customers across multiple industries
Commitment to continuous improvement:
Dedicated R & D Team
Strong results in initial pilot testing
– Productivity gains
– Working relationship
Autorek Factors
© 2011 IBM Corporation
24
High Level Process
The Data
1. Payment Data is Imported from banks in digital format
2. Customer information is imported either from the client ERP or AR Collect.
3. Transactional information is imported either from the client ERP or AR Collect.
4. Remittance information is digitized and then processed via a OCR reader to extract transactional information.
The Process
1. Payment information is matched to customer name using a wide variety of rules. Where it is not possible to match the customer to a payment it is sent for exception processing via workflow.
2. Remittance information is extracted from the advice and matched to transactions. Exceptions are routed for manual inspection via workflow.
3. The payment / Customer file in 1 above is matched to the transaction / remittance file and reconciled.
4. Export file created to be imported into the client ERP system.
© 2011 IBM Corporation
25
Deployment timeline
Category Activity
Week
1 2 3 4 5 6
Project Kickoff
Preparation Design Workshops
Requirements definition
Configuration Extract development
Application configuration
Testing and training Testing – system and process
Training
Go-Live
© 2011 IBM Corporation
26
Pre-Autorek Background• Matching Process – Trade Payments received are cleared against open invoices. • 25% - 50% of payments researched and cleared manually.• Matching criteria - pre-defined in ERP; difficult to amend
Solution – Autorek Tool Autorek Tool works as an intermediary to the Bank and ERP to enhance the auto-match. Takes details from Bank, validates against ledger feeds & identifies potential matches Provides flexibility to design new matching rules which can be added to the tool and would aid in
improving / suggesting matching possibilities.
Current Status Quick deployment; tool stable after four weeks of operation 85%-90% invoices with partial matches being achieved Intercompany matching of cross-company receipts previously handled manually, now automatic
Autorek Cash Apps Process – One Client Experience
SAP – BU #1 50%
SAP – BU #2 50%
Oracle – BU #3 75%
SAP – BU #1 84%
SAP – BU #2 90%
Oracle – BU #3 84%
Pre AutoRek Post AutoRek
In SummaryAutoRek will help optimise staff productivity, resource planning and management in your Shared Service Centre…
RelativeEffort
RelativeFTE
Improving compliance with regulation
Reducing financial and operational burden of regulation
Reducing production costs of management information and the reliance on IT to cut data and produce reports
Faster error detection, default detection and recovery speeds
Creating capacity for increasing business volumes
Improving speed and quality of management information
Demonstrating and monitoring stronger financial controls
Improved visibility of adherence to service level agreements
… and we are prepared to prove it…..
Rapid Deployment Approach
Poll Question 3
Would you be interested in a free, one-to-one discussion with one of our data management experts to discuss your Shared Service Centre’s business case?
Yes
Possibly, please send me further information
Unsure
Unlikely
No, I am definitely not interested
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+44(0) 141 229 5300www.AutoRek.com
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