Accounts Payable Migration – Streamlining ERP Transition

One of our clients recently merged with another company. Among other changes, the event of the merger also triggered a transition to a new Enterprise Resource Planning (ERP) system. As their trusted accounting advisory team, we were tasked with the process of migrating their accounts payable (“AP”) processes to a new ERP while simultaneously addressing a substantial backlog of invoices.

CHALLENGE:

The transition to a new ERP presented a dual challenge: We needed to establish AP processes within the new system and had to contend with a significant backlog of invoices awaiting processing. We had to devise innovative solutions to streamline and manage the AP process efficiently.

OUR APPROACH:

1. Backlog Assessment: We initiated a comprehensive assessment of the backlog, categorizing invoices based on priority and urgency. To effectively manage the backlog, we implemented a new AP invoice tracker. This tracker enabled us to monitor the status of each invoice, track progress, and prioritize tasks accordingly. Additionally, we developed an automated Management Information System (“MIS”) report within our tracker to provide real-time insights into the daily count of invoice backlog. This report empowered management with timely information, allowing for informed decision-making and proactive intervention as needed.
2. Process Optimization: Leveraging our expertise in ERP implementations, we identified opportunities to optimize AP processes within the new ERP. We explored various features, such as the workflow automation tool, to automate invoice routing and approval processes. Additionally, we established a new approval matrix for non-PO Invoices to ensure timely processing of the invoices.
3. Unique Solutions: Recognizing the magnitude of the backlog, we implemented unique strategies to expedite invoice processing. This included customizing the new ERP’s input template for drafting invoices, resulting in reduced manual data entry and minimized errors.
4. Vendor Statement Reconciliation: In addition to addressing the backlog, we implemented robust procedures for vendor statement reconciliation; we reconciled vendor statements with accounts payable records, identifying discrepancies and reconciling outstanding transactions efficiently.
5. Effective Communication: Throughout the transition process, we maintained daily communication with the client, providing regular updates on progress, addressing concerns promptly, and soliciting feedback to ensure alignment with their objectives and requirements.

RESULTS:

• Successful migration of AP processes to new ERP, including vendor statement reconciliation, invoice drafting, and approvals.
• Efficient management and resolution of a significant backlog of invoices through innovative solutions and process optimization utilizing new ERP features.
• Implementation of automation tools within the new ERP, such as workflow automation and vendor bill approval, to streamline AP processes and enhance efficiency.
• Effective daily communication with the client to provide updates, address concerns, and solicit feedback throughout the transition process.
• After the implementation of our unique solutions and process customizations, we were able to clear the AP backlog well within the stipulated time of completion, resulting in the client’s appreciation of the Knowcraft Analytics team.