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Excerpt from

Best practices to design and configure payment methods for accounts payable, accounts receivable, and cash management

Brian Shannon Dolphin

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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

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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

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Near-Cash Processes: an Overview

• AR & AP Process Integration Touch-points:

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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

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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

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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

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Capture: Lockbox – Deposit & Process

InfoCenter Dashboard,

Image linked to every

payment

Partial Application, On

Account, Exception Detail,

Master Data

Index

Image with

Payment &

Process

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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

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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

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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

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Processing: Document Management

• Linking Images to SD Documents

• All transactions within SD Document Flow could have image

attachments – how to access many at once?

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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

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Transition Invoice Data and Image

• The invoice image and data are linked and stored securely

Within

SAP

Invoice data stored in AP tables,

whether posted or not

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Your Turn!

How to contact us:

Brian Shannon

brian@dolphin-corp.com

Twitter: BrianSAP

Please remember to complete your session evaluation

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Disclaimer

SAP, R/3, mySAP, mySAP.com, SAP NetWeaver®, Duet™®, PartnerEdge, and other SAP products and services mentioned herein as well as their

respective logos are trademarks or registered trademarks of SAP AG in Germany and in several other countries all over the world. All other product and

service names mentioned are the trademarks of their respective companies. Wellesley Information Services is neither owned nor controlled by SAP.