Excerpt from Best practices to design and configure payment methods for accounts payable, accounts receivable, and cash management Brian Shannon Dolphin Copyright 2014 Wellesley Information Services, Inc. All rights reserved.
In This Session Explore options for designing a successful global payment platform Take an in-depth look at how to plan, launch, and track your SAP working capital initiatives. Hear best practices from the field to tackle the challenges of a global payment solution for accounts payable (AP), accounts receivable (AR), and cash management. A harmonized approach for optimizing AP and AR that delivers significant benefits which span the categories of cost containment, cash flow optimization, and risk mitigation How to leverage automated capture technologies, workflow models, and document storage options that don t deviate from organizational standards 1
What We ll Cover Near-Cash Processes: an Overview Accounts Receivable & Cash Application Accounts Payable & Optimizing Cash Integration Challenges Benefits of Harmonized Projects Wrap-Up 2
Near-Cash Processes: an Overview AR & AP Process Integration Touch-points: 3
Opportunities in Accounts Payable Increasing volumes due to growth/acquisition Improve automation of capture Reduce non-value added tasks Centralization: Shared Service Center, Outsourcing Multi-language, multi-country processing capable Mitigate vs. high error/loss rates from outsourced process Improve cycle times Increase straight-through processing Focused exception handling Transparency and Measurement Enhance KPI reporting Provide insight to internal and external constituents 4
Opportunities within Accounts Receivable Increasing volume of in-house /manual transactions Timing issues of decoupled payments/remittance advice receipt Extremely large payments that need to be applied and matched Low Auto-Match rates: Accurate identification of payee or invoice details Discrepancies & exceptions rule the process Exception handling for discounts earned/unearned, other discrepancies Lack of integration with other parts of the organization to determine appropriate handling of discrepancies Special issues: rebates, retroactive pricing, re-billings 5
Capture: Lockbox Common Lockbox Problems Cost Accuracy Rigid Data Template BAI2 Inflexibility around deduction processing Data access: storage, archival policies and costs vary widely Mail efficiency how much time does it really save? What about checks that are mailed to corporate office? Creates bank stickiness ; limits flexibility 6
Capture: Lockbox Deposit & Process Index Image with Payment & Process InfoCenter Dashboard, Image linked to every payment Partial Application, On Account, Exception Detail, Master Data 7
Capture: Unstructured Remittance Advice Documents are unstructured or variable in nature OCR solutions for in-house remittance processing Improved hit rates Reduced cycle time Less reliance on costly lockbox 8
Capture: Structured Remittance Advice Remittance Advice & Info Gateway: Streamlined processing 100% accuracy Address inbound ACH or wire transfers with decoupled remittance advice Pair the deposit with the created payment advice 9
Processing: Image & Transactions Validating Data to Save Time and Money Automate key tasks and leverage SAP, user exits Segregate non-conforming payments Display image next to transaction for processing Link image directly to FI clearing document 10
Processing: Document Management Linking Images to SD Documents All transactions within SD Document Flow could have image attachments how to access many at once? 11
Capture Solution Options Optical Character Recognition (OCR) Header & line-level capture options HIGHLY unstructured documents Validation vs. Vendor and PO extracts from SAP Business Rules (e.g. Tax) managed via Invoice Gateway into SAP Electronic options for automated capture Electronic Invoicing (einvoicing) from business hub or partner Traditional EDI can be normalized through Invoice Gateway Vendor portal offers flipping PO items directly into invoice 12
Transition Invoice Data and Image The invoice image and data are linked and stored securely Invoice data stored in AP tables, whether posted or not Within SAP 13
Your Turn! How to contact us: Brian Shannon brian@dolphin-corp.com Twitter: BrianSAP Please remember to complete your session evaluation 14
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