{"id":2727,"date":"2016-09-15T18:27:04","date_gmt":"2016-09-15T18:27:04","guid":{"rendered":"https:\/\/www.peeriosity.com\/shared-services\/articles\/?p=2727"},"modified":"2022-07-18T19:45:25","modified_gmt":"2022-07-18T19:45:25","slug":"simplifying-the-cash-application-process","status":"publish","type":"post","link":"https:\/\/www.peeriosity.com\/shared-services\/articles\/2016\/09\/simplifying-the-cash-application-process\/","title":{"rendered":"Simplifying the Cash Application Process"},"content":{"rendered":"

Making improvements in the cash application process using automation<\/a> can significantly reduce labor costs, increase cash flow, and improve external customer satisfaction. \u00a0Many Shared Service organizations are having success in improving Autocash matching rates and eliminating inefficiencies in the cash application process.<\/span><\/p>\n

A recent PeercastTM<\/sup> in the Accounts Receivable (O2C) research area<\/a> featured a global company discussing its four-year journey to improve the cash application process.\u00a0 The project started in 2012, with the identification of a variety of improvement opportunities.\u00a0 It was a long list, including instances where electronic bank statement information from Europe was entered manually; with EFT and wire transfer payments being manually recorded in North America.\u00a0 The overall improvement opportunity focused on automation, with six solution providers evaluated and two selected to complete detailed statements of work.\u00a0 External solution providers were compared with the option to create a custom IT solution in-house. At that time using a custom in-house IT solution was a clear winner because of the benefits of increased flexibility, lower cost, and the need to meet diverse requirements for both Europe and North America.\u00a0<\/span><\/p>\n

Fast-forward to 2016 and it was time to replace out-of-date software.\u00a0 HighRadius, a third-party SAS solution that integrated with SAP, was selected after an evaluation of alternatives that started in early 2015.\u00a0 This cloud-based solution helped the featured company increase automation by providing an enhanced solution for handling email and web remittances compared to their existing OCR approach and supporting the bundling of EDI 820 remittances.\u00a0 The solution also helped the company further optimize the cash application process<\/a>, as well as reduce its IT support requirements.<\/span><\/p>\n

A recent iPollingTM<\/sup> question from another Peeriosity member who was considering a third-party solution asked for feedback regarding how companies were approaching the auto-application of cash receipts.\u00a0 For 36% of responding companies, in-house standard ERP functionality was used, with an additional 23% using custom internally developed software.\u00a0 Another 23% indicated that the process was performed in-house using purchased non-ERP software, with the remaining 19% of the companies indicating that they use a third-party solution.<\/span><\/p>\n

Here are the details:<\/span><\/p>\n

\"company's<\/p>\n

The second poll question asked about the company approach to the auto-application of customer payments that were either recently selected or were being considered, with 80% of responding companies indicating that they had not made recent changes in how auto cash is handled and they have no plans to do so.\u00a0 The remaining 20% have either moved cash applications to a bank or another type of third party or they have plans to do so within the next three years.<\/span><\/p>\n

\"ipolling<\/p>\n

Here are some of the comments added to iPollingTM<\/sup> responses:<\/span><\/p>\n