The Challenge: Delays in Financial Close Impacting Business Insight
Our client, utilizing Oracle ERP Cloud, faced significant challenges with their financial closing process. They had a critical internal deadline to close their books by the 7th of each month. However, the existing processes were inefficient, leading to the close consistently extending well beyond this target date.
This delay had a direct impact on the business, specifically hindering leadership’s access to timely executive dashboards and crucial financial reports needed for informed decision-making. Bottlenecks existed across various areas, including complex payroll data corrections, manual-heavy Accounts Payable processes, time-consuming Accounts Receivables postings, and cumbersome procurement accrual calculations. Resolving these issues required excessive manual effort and coordination at month-end.
The Solution: Streamlining Operations with Oracle ERP Cloud Optimization
DPR Solutions partnered with the client to analyze their existing Oracle ERP Cloud processes and identify key areas for optimization within their financial closing cycle. Our approach focused on streamlining operations, leveraging Oracle’s built-in automation capabilities, and improving cross-functional handoffs.
Key steps taken included:
- Simplifying Payroll Corrections: We analyzed frequently occurring payroll data correction issues and implemented automated alerts to notify the relevant business owners proactively. This drastically reduced the time spent at month-end fixing known issues, allowing the team to focus primarily on resolving new errors.
- Streamlining Accounts Payable: Addressing numerous mini-process inefficiencies in AP was critical. We worked closely with the business and implemented Oracle’s Intelligent Document Recognition (IDR) and Optical Character Recognition (OCR) capabilities for incoming invoices. This automated the creation of invoices, significantly reducing manual data entry and minimizing errors at the source. Furthermore, we built automated workflows that triggered immediate alerts to the designated business owner whenever an invoice went on hold, enabling prompt action and preventing holds from accumulating.
- Improving Accounts Receivables Postings: Delays in posting AR transactions, particularly applying cash and resolving unapplied items, were impacting revenue recognition and reconciliation. We focused on establishing a robust process to clear these unapplied invoices and unidentified cash in a timely fashion. Although invoice amounts were received, clearing them using bank statements and posting them used to take a lot of manual effort. We simplified this by fine-tuning the Oracle AutoCash Rule Sets to automate matching for invoices, significantly reducing the manual effort required for cash application.
- Optimizing Receipt Accruals: To improve the accuracy and timeliness of procurement accruals, we optimized receipt accruals by implementing the “Accrue at Receipt” method for items that could be accrued at the time of receiving. We also changed the frequency of the “Create Accounting” process for Receiving transactions from weekly to daily, ensuring accrual entries were posted to the General Ledger much sooner. Additionally, we provided targeted training to users on effectively utilizing the “Receipt Accrual – Period-End” process to proactively identify unbilled receipts and take necessary actions throughout the period.
The Results: Meeting Deadlines and Gaining Timely Insights
As a direct result of these targeted process improvements and Oracle ERP Cloud optimizations, our client achieved a significant transformation in their financial closing process.
- 30% Reduction in Close Time: The total time required to complete the financial close was successfully reduced by 30%.
- Meeting the Deadline: The client is now consistently able to meet their internal deadline of closing the books by the 7th of each month.
- Timely Reporting: Critical executive dashboards and financial reports are now available to leadership much earlier, enabling more agile and informed decision-making.
By partnering with DPR Solutions and leveraging the power of Oracle ERP Cloud more effectively, the client not only streamlined their operations but also gained valuable time back in their financial cycle, providing timely and accurate information to drive their business forward.