A Canada-based leading consumer health services organization.
Scope of Work
Complete support with:
End-to-end accounting including Accounts Payable, Accounts Receivable, General Ledger.
Inadequacies of ERP migration led to the following issues:
- Unreconciled and unapplied payments in accounts payable worth 6Mn
- Unreconciled and unapplied receipts in accounts receivable worth 8Mn
- Unreconciled clearing accounts for 5Mn
- Unavailability of previous reconciliation reports
- Improper categorization of general ledger
- System information vs. tax return variance
- 2 months lag on records processing
Cogneesol’s Optimization Solution
Considering the range and scale of the problems that had plagued the processes, we divided our team into separate sub-teams to address the issues process-wise. We drew up existing process flows, identified gaps that had led to the piling up of issues, redesigned process flows to make them error-free and compliant. Along the way, we developed process documentation to emphasize and institutionalize the proposed steps. Given below is a glimpse of some of our corrective measures:
- Tracked and organized historic vendor payment details, consolidated data to clear disputed vendor accounts
- Identified items requiring manual adjustments, listed due receivables and reconciled with unapplied receipts
- Reconciled AP, AR, and clearing accounts that sorted a significant number of outstanding checks not cleared by bank
- Redesigned Chart of Accounts (COA) structure to be in sync with tax return and GL processes focused on improving the granularity of accounting information, manual adjustments made to improve allocation accuracy
- Dedicated resource engaged to ensure daily point-of-sale reports are entered and reconciled with the bank account by using technologies that sync directly with the new ERP system.
Cogneesol has set our accounting house in order! We had staggering amounts in unreconciled accounts. They cleaned the books, cleared the accounts, and have reduced our closure period. They are now an extension of our Finance department.
The above streamlining of processes and introduction of process controls created intelligent operating models delivering immediate and lasting impacts:
- Applied and reconciled vendor payments worth 6Mn within 15 days; increased and maintained vendor satisfaction rate at 97%
- Past due receivables worth 8Mn cleared within 17 days; accuracy of cash application rate maintained at 99% through the last year
- Reconciled clearing accounts for 5Mn within 20 days while maintaining accuracy and TAT
- Allocation accuracy and timeliness improved from 70% to 98%
- System information mirrored with tax return
- Cleared current year backlog within 30 days
- Month-end closure reduced from 15 to 10 days
It is always a pleasure to learn that the work we do has positively impacted our clients and that they are happy to share their experiences.
We automated our Accounts Payable division with the help of Cogneesol’s team of qualified accountants. They came in with game-changing process improvements, including the elimination of data-entry errors with automated OCRs, the establishment of a ‘No PO No Pay’ policy, ensuring a system of timely payments, and elimination late fees. All of these have changed the face of our AP books. We are now in a great position to make strategic decisions.
Cogneesol increased our operational efficiency with timely payments and efficient management of our working capital. We are impressed with the dedication of the team and their professionalism. Most importantly, the team is professionally qualified and has the technical expertise to guide the accurate and compliant management of the payables process. Thanks to them, we have a non-manual AP function that functions seamlessly and has brought us significant cost savings.
We used to suffer from huge volumes of duplicate invoices and missed vendor payments. Cogneesol streamlined our Accounts Payable process by centralizing data, eliminating data entry, and streamlining the invoice workflow. This has not only eliminated the problem of duplicate invoices but has also standardized the payment system and has regulated our working capital management, making us financially stronger and in-control of our operations.
We had a huge pile of outstanding receivables that had blocked huge amounts of cash. We hired Cogneesol to help clean up our account sand support, especially with the receivables. The team charted a collections plan, segregated receivables as per their DSOs, and allocated the collections to their team with set targets. It took the agents under two months to collect close to 90% of our receivables!
Our customer master data was in complete disarray, slowing down our receivables considerably. Cogneesol assigned us a dedicated resource to help with customer data maintenance and streamline all the other sub-processes of Accounts Receivables. The resource immediately set to task with correcting payment terms, centralizing data maintenance, implementing controls, and conducting regular audits. Soon we were able to do away with more than 80% of customer disputes!
Cogneesol transformed our Accounts Receivables processes, freed up cash, and optimized our working capital position. The team does a thorough job of checking the accuracy of their bills, invoices, or credit terms, apply for cash payments correctly, do not override credit limits, follow up with customers in a timely manner when payments are past due, collect and apply cash correctly. These have made our Accounts Receivables position very efficient!