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Advanced Receivables Solutions

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    • 1. Advanced Receivables Solutions Wednesday, May 2, 2007 Cynthia Ballard – Treasury Manager Brian D. Hall, CTP, AAP – Healthcare Treasury Services Sales Officer
    • 2. Session Overview
      • Cash Flow Cycle – Where is Accounts Receivable?
      • Paper to Electronic – A Case Study
        • Financial Analysis
      • Additional Advanced Receivables Options
      • Industry-specific Receivables Options
      • Questions?
      • Contact Information
    • 3. Cash Flow Cycle – Where is A/R? Brian D. Hall, CTP, AAP – Healthcare Treasury Services Sales Officer
    • 4. Cash Flow Cycle – Where is A/R? Financial Institutions and Third-party Vendors can assist with Items in Blue
    • 5. Paper to Electronic – A Case Study Cynthia Ballard – Treasury Manager
    • 6. Paper to Electronic – A Case Study Company Overview CORESTAFF Services, Inc., is a subsidiary of British staffing firm Corporate Services Group, and is based here in Houston, TX. The company provides temp-to-hire, contract, and direct hire staffing and related services in fields such as office administration, banking, customer service, light industrial, and sales and marketing. Among its specialty staffing areas are information technology, engineering, accounting, and library records management. The company has approximately 500 staff employees and approximately 10,000 temporary associates on assignment weekly throughout the U.S. in more than 100 offices.
    • 7. Paper to Electronic – A Case Study Paper Invoice Processing Environment
      • Six Accounts Receivable Full Time Employees (FTEs)
      • Three Wholesale Lockboxes
        • CORESTAFF Services, Inc. – Charlotte
        • CORESTAFF Services, Inc. – Los Angeles
        • Comensura (A Corporate Services Group company) – Charlotte
      • No Image Capabilities
      • No MICR or Value-added Keying Capabilities
      • Overnight Courier Packages delivered via FedEx
      • CORESTAFF Manual Check and Document Scanning Initiative
    • 8. Paper to Electronic – A Case Study Business Analysis
      • Initial Conversation between CORESTAFF and Wachovia
      • Wholesale Lockbox Image Webinar Session
        • Overall Image Solutions Concept Presentation
      • On-site Wholesale Lockbox Image Discussion
        • Wholesale Lockbox Virtual Tour
        • Wholesale Lockbox Image Demonstration
      • CORESTAFF Internal Evaluation
        • Financial Analysis
    • 9. Paper to Electronic – A Case Study
      • Reduce Days’ Sales Outstanding (DSO) by one day
      • Eliminate Lockbox-related FedEx Expenses
      • Reduce Paper Storage Expenses
      • Improve Cash Posting Production
      • Reduce Department Head Count by one Full Time Employee (FTE)
      Expectations – Before Implementation
    • 10. Paper to Electronic – A Case Study Technology Analysis CORESTAFF invested in six dual-monitor computer systems for the Accounts Receivable posting staff. This purchase allowed the company to retire old equipment and support the “Improve Cash Posting Production” expectation.
    • 11. Paper to Electronic – A Case Study Reduce Days’ Sales Outstanding (DSO) by one day Realizations – After Implementation
        • CORESTAFF Services did gain one day in DSO collection
      Eliminate Lockbox-related FedEx Expenses Reduce Department Head Count by one Full Time Employee (FTE) Improve Cash Posting Production Reduce Paper Storage Expenses
        • Reduced FedEx costs by $6,000 - $8,000 per year
        • Eliminated the generation of one bankers box of back-up each week
        • Increased productivity and realigned processing with an 8-5 workday
        • CORESTAFF was able to reduce head count in A/R by two FTEs
    • 12. Paper to Electronic – A Case Study Unexpected Realizations
      • Reassigned one Full Time Employee to the Credit and Collections team
      • Improved the Credit and Collections team’s research process
        • Collectors access images without support from the A/R team
      • Improved Business Recovery/Disaster Recovery contingencies
        • Reduced multiple points of failure (weather-related events, late overnight delivery)
      • Improved mid-year and year-end Independent Audits
        • Auditors access images independently
        • Research time was significantly reduced (no digging through boxes)
    • 13. Paper to Electronic – A Case Study Unexpected Realizations
      • Improved Employee Morale
        • Employee acceptance of the migration was incredibly swift
        • A recent status check indicated 100% preference for online processing
        • One Accounts Receivable Clerk stated, “They’d have to fire me if they wanted to take away my screens.”
      • Reduced Bank Fees
        • CORESTAFF was able to reduce their bank fees at Wachovia by moving to image-based processing
    • 14. Financial Analysis Cynthia Ballard – Treasury Manager Brian D. Hall, CTP, AAP – Healthcare Treasury Services Sales Officer
    • 15. Financial Analysis Impact on Working Capital – DSO Calculation Reduce Days’ Sales Outstanding (DSO) by one day
        • CORESTAFF Services did gain one day in DSO collection
      $116,480 Overnight Sweep Investment – 4.16% $2,800,000 Freed Working Capital
    • 16. Financial Analysis Full Time Employee – Total Compensation Reduce Department Head Count by one Full Time Employee (FTE)
        • CORESTAFF was able to reduce head count in A/R by two FTEs
      Salary.com’s May 2007 Base Salary, Bonus, and Benefits* Analysis – Houston, TX * Benefits include company-paid Social Security, 401k, Disability, Healthcare, and Time Off http:// www.salary.com $52,386 $15,772 $485 $36,129 Average $54,912 $16,333 $529 $38,050 Senior Accounts Receivable Clerk $49,861 $15,212 $441 $34,208 Accounts Receivable Clerk Total Compensation Benefits * Bonuses Base Salary
    • 17. Financial Analysis Overall Financial Impact - Annual * Measured period of time was 1/2006 – 5/2006 ** Measured period of time was 7/2006 – 3/2007 CORESTAFF Services, Inc. went live with WLI in June 2006 $105,751.00 Net Savings $46,098.52 $151,849.52 Total $1,980.00 $0.00 Hardware & Software – Second Monitor (6 stations) $12,000.00 $0.00 Hardware – Computer & First Monitor (6 stations) $0.00 $520.00 Paper Storage Expenses (52 boxes/year) $0.00 $7,000.00 Overnight Courier Fees (average/year) ** $32,117.52 * $39,557.52 Average WsLBX Bank Fees $0.00 $104,772.00 Labor (2 FTEs – Total Compensation Analysis) Image-based Paper-based Expenses
    • 18. Paper to Electronic – A Case Study Questions?
    • 19. Additional Advanced Receivables Options Brian D. Hall, CTP, AAP – Healthcare Treasury Services Sales Officer
    • 20. Additional Advanced Receivables Options
      • Electronic Capture of the MICR Line on the Check
      • Value-added Keying from Lockbox Checks and/or Invoices
      • Online Decisioning of Unprocessable Items via Imaging Applications
      • Retail Lockbox Processing
        • Accounts Receivable Conversion (ARC) ACH Transactions
        • Positive/Negative File Processing
      • Wholetail Lockbox Processing (WHOLEsale + reTAIL)
        • Hybrid Solution – Automation of Retail, Customization of Wholesale
      Advanced Paper Lockbox Options
    • 21. Additional Advanced Receivables Options
      • Electronic Funds Transfer (EFT) Integration
        • Consolidation of data from three main sources:
          • Incoming ACH Credits (including Addenda Records)
          • Incoming Domestic and International Wire Transfers
          • Incoming Lockbox Transactions
            • Including captured MICR and Keyed Data
      • Data Transmission directly to Accounts Receivable
        • EDI 820 & 823, BAI, and Custom Formats
        • FTP Transmission Methods, Fax, E-mail, Paper
      Electronic Lockbox Options
    • 22. Additional Advanced Receivables Options
      • Electronification at the Point of Sale
        • Remote Desktop Capture (RDC) – Enabled by Check 21 Legislation
        • Point of Purchase (POP) ACH Transactions
        • Back Office Conversion (BOK) ACH Transactions
      • Items that are Ineligible for Truncation *
        • Money Orders, Treasury/Convenience/Third-Party/Foreign Checks
        • Checks that contain an auxiliary on-us field in the MICR line
        • Checks written for more than $25,000
        • Checks where the business chooses to Opt-out of Conversion
      Point of Sale Options * These ACH rules become effective on September 15, 2006 http://www.nacha.org/News/news/pressreleases/2005/Pr110205/pr110205.htm
    • 23. Industry-specific Receivables Options Brian D. Hall, CTP, AAP – Healthcare Treasury Services Sales Officer
    • 24. Industry-specific Receivables Options
      • Financial Services
        • Mortgage, Credit Card, and specialized Banking applications
      • Healthcare
        • Paper and Electronic Payments from Consumer and Insurers
        • Optical Character Recognition of Explanation of Benefit Statements
      • Insurance
        • Extraordinary Regulatory Requirements
      • Real Estate
        • Processing multiple properties in a single environment
    • 25. Advanced Receivables Solutions Questions?
    • 26. Contact Information Thank You for your Interest, your Time, and your Attention! Enjoy the rest of the Mini-Conference! Brian D. Hall, CTP, AAP VP, Sales Officer – Healthcare Treasury Services – Client Management Wachovia Bank, N.A. 98 San Jacinto Boulevard, TX7042 Austin, TX 78701 (512) 482-4378 - Office [email_address] Cynthia Ballard Treasury Manager CORESTAFF Services, Inc. 1775 St. James Place Suite 300 Houston, TX 77056 (713) 438-1503 - Office [email_address]