AUTOMATED payment processing and validation improving accuracy and operational efficiency
ACCELERATED cash flow with real-time payment posting enhancing financial agility
INTEGRATED advanced automation into core systems enabling long-term scalability and compliance
Client
A North American healthcare provider with a wide network of facilities and services across the U.S.
Scope of Work
Validation and approvals of bills, cash application and payroll.
Geography Serviced
North America
Industry Serviced
Healthcare
Client’s Challenges
The client faced significant challenges due to the complexity and high volume of their payment processing operations. These issues led to delays and errors in cash application, adversely affecting financial reconciliation and the timeliness of reporting.
Key Challenges Identified:
- Processing Delays: The substantial volume of transactions overwhelmed the accounts receivable team, leading to delays in applying cash to customer accounts. This lag distorted the company's cash flow visibility and hindered timely financial decision-making.
- Data Entry Errors: Manual processing of numerous transactions increased the likelihood of data entry errors, resulting in discrepancies during financial reconciliation. These errors necessitated additional time and resources to identify and correct.
- Complex Transactions: Handling a variety of payment types and sources added complexity to the cash application process, making it challenging to match payments accurately with corresponding invoices. This complexity often led to unapplied or misapplied payments, further complicating reconciliation efforts.
- Timing Differences: Variations in processing times between different payment methods and financial institutions caused timing discrepancies. These differences complicated the alignment of transactions in financial records, leading to challenges in accurate cash reconciliation.
- Inadequate Documentation: Insufficient or inconsistent documentation accompanying payments made it difficult to match them with the correct invoices. This lack of information led to delays in cash application and increased the risk of errors.
These challenges collectively impeded the client's ability to manage cash flow effectively, maintain accurate financial records, and generate timely financial reports. Addressing these issues was crucial to enhance operational efficiency and financial performance.
Impact Generated
Our solution delivered substantial improvements across operational and financial dimensions:
Enhanced Operational Efficiency:
- Reduced processing time from 36 hours to 24 hours, accelerating service delivery by 33%.
- Achieved same-day posting, enabling faster credit replenishment and instant credit availability.
- Improved straight-through processing accuracy from 70% to 95%, cutting errors by 50%.
- Automated 80% of the process, which reduced labor costs by 40%.
- Streamlined staff allocation, allowing teams to focus on strategic tasks and overall operational effectiveness.
- Reduced reconciliation time by 30% through seamless ERP integration and eliminated 95% of manual data entry errors.
- Lowered pending transactions by 80%, optimising workflow efficiency.
Drove Financial Impact:
- Recovered $4.5M annually from previously lost revenue—cutting revenue leakage by 90% (down from $5M annually).
- Saved $2.5M each year by optimising financial processes.
- Improved cash flow by 40%, ensuring smoother operations and enhanced liquidity.
- Reduced outstanding payments by 85%, boosting overall financial health.
- Achieved 100% compliance, eliminating regulatory risks.
Cogneesol’s Solution
Given the range and scale of the challenges affecting the processes, we conducted a thorough analysis of existing workflows, identified key gaps contributing to inefficiencies, and redesigned these processes to ensure they are both error-free and fully compliant.
Once the new workflows were in place, our F&A and Tech teams collaborated to deploy an automation solution. UI Path applications were used to create a BOT that executes the step-by-step process according to the business requirements.
Here are its broad outlines:
- Automated Data Extraction and Validation: Extraction of payment PDFs into Excel with automated validation.
- Validated Remittance Details: Implementation of automated checks on each transaction line to ensure data accuracy.
- ERP Integration: Seamless extraction of remittance data from Excel with cross-verification against ERP records.
- Cross-Referenced Payment Information: Automated retrieval of rates and hours from the ERP system to align with payment amounts.
- Automated Invoice Matching: An automated system that compares invoices with calculated amounts and bank deposits.
- Automated Payment Application: A process that applies matched payments, ensuring consistency with business rules.
