Optimise the invoice-to-cash cycle: Improve visibility and control over cash
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Automatic Cash Application
Raimondo Saiu
Credit Manager EMEA PPG Industries Europe
Agenda
Introduction PPG Industries
Background Bank Reconciliation Process
Hanse Orgas AutoBank
Business Case
Results & benefits
Introduction PPG Industries
PPG Industries is a Pittsburgh based global supplier of paints, coatings, chemicals, optical products, specialty materials, glass and fiber glass.
Private houses Millau Bridge, France Ponte Vecchio,
Florence, Italy
Stade de France Oil tanker
Introduction PPG Industries
More than 100 legal entities in EMEA
Two main ERPs Oracle & SAP
Multiple different organizational and Sales & Finance structures
Both centralized and decentralized finance departments
Customers varying from individual painters to OEMs
Direct sales via a network of more than 400 owned service centres and almost 3,000 independent wholesalers.
Background Bank Reconciliation
Completely decentralized cash application and collection process
Only partly electronic, different levels usage of and experiences with standard SAP in the various subsidiaries.
Manual reconciliation of open items very time consuming. Knowledge not maintained/transferred, no best practices set up
or shared via the ERP Result: In general, a low automatic clearing rate to the final target
account (customer/vendor document, GL JE)
SAP matching improvements required ongoing IT support
No positive impact on credit & collection process
Hanse Orgas AutoBank
Hanse Orga is an SAP service partner with their own name space in SAP
AutoBank for SAP is fully integrated into SAP (no interfaces needed)
AutoBank consists of two modules: - AutoKonto, posting bank statement data - AutoAvis, posting payment advices Unlimited posting rules - Using main rules and sub rules - Using all information on the bank statement - Filtering bank statement information (bank fees, data, FX,
discounts, invoice data, ordering bank etc) - Maintained by the users!!!
AutoBank Business Case
Business case performed in three countries with large number of bank transactions: France, Belgium and The Netherlands.
Different problems existed in these countries:
France: incomplete electronic bank statements, many cheque payments
Belgium: missing information on electronic bank statements, incomplete information given by customer, number ranges in text (500110/111/112 etc)
Netherlands: many payment advices, incomplete information, number ranges in text
AutoBank Business Case
With regards to the AutoAvis module, remittance advices were looked at separately:
France & Belgium: not enough volume, not enough invoices, limited time spent on remittance advices. Not enough benefit to implement AutoAvis for these entities.
Netherlands: large number of advices received by mail, fax, post and EDI, many invoices per customer (up to 6000 invoices p/m), a lot of processing time required.
Project Implementation Roadmap
Business Blueprint documenting the process, coding & bookings
Review internal process & bank statements with consultant & business
The matching rules creation & testing is done as part of the key-user training
Wrap-up training with users after go-live
Business
Blueprint
Business
Case
Implemen-
tation
Preparation
GO-LIVE
GO-LIVE &
Support
Project
preparation
Results France automatic matching rate
SAP: 26%
AutoKonto: 91%
Belgium automatic matching rate
SAP: 25%
AutoKonto: 90%
Netherlands automatic matching rate
SAP: 75%
AutoKonto: 88%
AutoAvis: 98%
Results
Higher automatic matching rate, in general only exceptions were:
Double payments, payment of credit notes by customer
Customer deductions
New customers without any information/reference
Rejected drafts/checks
More efficient manual postprocessing
Immediate rule creation/testing by users
Post-processing
Automated Process
Additional steps:
All bank information available is included in the electronic bank file
Centralized electronic bank files to one source Payment terms & conditions (for example discount terms)
correctly entered in ERP Stimulate customers to provide more details Stimulate customers to send remittance advices in a standard
electronic format Review your reconciliation process and specific accounts
What did it bring us
Most immediate benefits were found in process efficiency
Implemented now in more than 25 company codes, covering bank accounts in almost all European countries
Implemented AutoBank Next Generation for our Oracle entities
Reduced the unapplied cash, enabling the collection team to contact the customer with accurate data (and sooner!).
Enabled Treasury Department to have a more accurate liquidity forecast.
Cost savings achieved through process centralization
Questions
Thank you for your attention!
Any questions ?
[email protected]
Additional Slides
Additional Slides
Previous process
Import routine
Posting step 1
USER-EXIT
Posting step 2
MultiCash
Manual post-processing
Import of bank
statements in different
country formats Posting from bank
account to bank sub-
account Possibility of exit into
user exit
Posting from bank
sub-account to
corresponding target
account Manual assignment of
unassigned items
Posting Bank Statement Data
AutoBank for SAP
Posting Bank Statement Data
AutoBank for
SAP
SAP R/3
OI data Posting data
Electronic
bank statements Archive data
Automatic posting
of bank statements in SAP
AutoBank for SAP
USER-EXIT AutoKonto for SAP
Posting step 2
Manual postprocessing
Payment
methods
Main rules
Sub rules
Foreign
exchange
Cross-CC
No. intervals
Filter principle
Posting Bank Statement Data
Multiple clearing
AutoBank Business Case
AutoBank Business Case
