Financial Processes Documentation/Assessment
Client Project
A large medical equipment manufacturer engaged PPI to document its finance processes and controls and recommend improvements for greater effectiveness.
Project Goals and Areas of Focus
- The organization needed to have core financial processes around cash management and reconciliations documented in detail in order to:
- Identify existing controls
- Determine areas of possible improvement for prioritization and action
- Support SOX audits
- PPI performed in-depth current-state analysis of cash management processes, sub-processes and procedures including: check handling (inc. deposits, application, refunds), exception and error correction processes, cash application, daily and monthly reporting, and daily and monthly reconciliations
- IFor each process PPI's analysis included roles and responsibilities, process flows and in-depth activity breakdown, detailed risk-control matrix with deficiencies highlighted, and identification of opportunities for improvement in the areas of increased controls to mitigate identified risks, elimination of unnecessary procedures, and process changes to improve controls and/or efficiency
- IFor each process PPI's analysis included roles and responsibilities, process flows and in-depth activity breakdown, detailed risk-control matrix with deficiencies highlighted, and identification of opportunities for improvement in the areas of increased controls to mitigate identified risks, elimination of unnecessary procedures, and process changes to improve controls and/or efficiency
- In addition, PPI developed high-level functional-area process documentation and risk-control matrices for additional finance areas, including Procure to Pay, Inventory Management and Financial Closing
- Twenty-three cash management and reconciliation processes were documented at the task level
- An average of three process improvement opportunities were identified for each and validated as significant by functional leaders
- An average of three process improvement opportunities were identified for each and validated as significant by functional leaders
- Key areas of risk and opportunity were identified and prioritized to be addressed in follow-on initiatives over the next twelve months
- Benefits gained by the organization from the assessment and subsequent improvement efforts include:
- Strengthened financial and operational controls over cash processes
- Reduced risks around cash management
- Cost reductions
- Reduction of process complexity and inefficiencies
- Improved hand-offs within and between departments
- Reduced cycle times
- Elimination of duplication of effort
