Recommended
Recommended
More Related Content
What's hot
What's hot (18)
Similar to 7 Reasons Not to Ignore Potential Cost Savings
Similar to 7 Reasons Not to Ignore Potential Cost Savings (20)
More from Mark Reading
More from Mark Reading (20)
Recently uploaded
Recently uploaded (20)
7 Reasons Not to Ignore Potential Cost Savings
- 1. 7 reasons not to conduct a Cost Recovery Project David Lyon
- 2. What is a cost recovery audit? āThe theory of marginal gainsā
- 3. What is a cost recovery audit? Sometimes called āAnalysis and Reconciliationā Core Services: ā¢ Purchase ledger review o Invoice level ā¢ Contract compliance o Devil in the detail o E.g. temporary staffing review
- 4. How can the service be accessed? ā¢ NHS Procurement Hubs āAnalysis and Reconciliation frameworkā ā¢ Typically ānon win no feeā
- 6. Purchase ledger review ā¢ Unused credits in suppliersā books ā¢ Duplicates ā¢ Vat
- 8. Purchase ledger review āMorning Jane, Potentially a very stupid question for youā¦ but do I just send the sage stmt? Or should I edit it first ā there are some PoAs and other bits ā do we own up to these or just include the current invoices/debt? How was the apple jam? Did it set? Alisonā This is a real email from a supplier we were copied into (names changed)
- 9. Purchase ledger review Ginas big write off - I1401-1264314,548.52-Ā£ This is a real extract of a suppliersā transaction listing
- 11. Contract compliance āPrices and termsā ā¢ Telecoms ā¢ Temporary agencies ā¢ Utilities ā¢ Property
- 12. Contract compliance Example ā Temporary agencies Complex Contracts ā¢ Pass through costs ā NI, pensionsā¦.. ā¢ Management fees ā¢ Errors
- 13. 7 Reasons why it can never work.
- 14. Reason number 1
- 15. āI donāt believe itā ā youāll not get much back
- 16. Purchase ledger ā¢ Recoveries - 1 in 5,000 to 1 in 10,000 invoices ā¢ Credits - 3 out of every 100 suppliers ā¢ Typically 20p - 30p per invoice Recovery range 20p 30p Volume 100k p.a. 400k 400k Likely ācashā Ā£80,000 Ā£120,000 Ā© 2016, All Rights Reserved. Meridian Cost Benefit Ltd
- 17. Reason number 2
- 18. It will be too disruptive
- 19. Reason number 3
- 21. Reason number 4
- 22. āEven if you do find errors they would all have come out in the washā
- 23. Reason number 5
- 24. āWeāve tightened our processes since our last projectā
- 25. Reason number 6
- 27. Pattern of recoveries (project timing) 0 Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 ProjectKickOff
- 28. Reason number 7
- 29. āit will upset our suppliersā
- 30. Any reasons to consider? ā¢ Risk-free cash āgenerationā ā¢ Create unbudgeted fund ā¢ Preserve headcount ā¢ NHS Transform āflagship projectā ā Incentivise other areas to focus on efficiency ā Demonstrate āgood citizenshipā and encourage others in the organisation
- 31. N
- 32. About Meridian ā¢ We work in partnership with our clients to recommend risk reductive process change ā¢ Market leading audit/re audit recovery rates, backed by 10+ yrs. statistics/examples. ā¢ Minimised overhead on your organisation through Meridianās litetouchTM data extraction and audit review process ā¢ Unparalleled library of customer testimonials ā¢ All our people are permanent staff, no sub-contracting o Guarantee of consistent quality of delivery ā¢ Broad and deep expertise. Staff include ACA accountants, a former head of service at Accenture, and others with big Consultancy experience. ā¢ SME flexibility For more than a decade, Meridian has worked with hundreds of the UKās public sector organisations to maximise cost recovery, cost reduction, cost mitigation and risk management.
- 33. Intrigued? ā¦lets talk and see if it makes sense for you (if not, we will tell you why) Meridian switchboard: 01727 829640 My mobile 07721 551901 david.lyon@recoveryaudit.com
- 34. Thank you! Questions, please Meridian Cost Benefit Ltd Tyttenhanger House Coursers Road St Albans Herts AL4 0PG
- 35. A final word I have been very impressed with Meridianās professional approach - and their call on our services have been minimal. I have a 10/15 minute catch up call every 7/14 days. I would have no qualms about recommending Meridian. Russell Ward ā Head of Account Payable and Enablement, NHS Wales
Editor's Notes
- I have worked in health and social care for over 25 years Many changes and initiatives in that time driven from the top The biggest change over that time is simply people doing everything a little but better May just make a small but meaningful contribution Good practice Victor Kayam Large corporates
- Contact compliance itself splits
- Also under CCS RM1037 frameworks No requirement for an expensive procurement process ā simple call-off
- Everyone thinks its all about duplicates Typical % Credits 60% + Duplicates ā 25% Vat 15% (NHS restricted)
- Imagine credits are the apples on a tree Low hanging fruit High hanging fruit Ensure you pick a consultancy that is prepared to go for the higher hanging fruit
- Typically recoveries are not because of processing issues They are because suppliers have credits that they havenāt told you about
- Purchase ledger is a numbers games All large organisations overpay their suppliers % are small but amounts are meaningful Might save headcount Might fund another project The cost is not doing it Donald Rumsfeld
- Accuracy rate is 99.95% to 99.99% Just a numbers game
- It can be light touch Select your consultancy provider carefully ā get references! Ask what you have to do and what the consultancy offers to do Watch for false positives
- This can be a real worry We āsit in the clientsā chair We never expose any individual or department What we find is rarely due to avoidable errors or negligence Look at the cost benefit analysis? Employing 5 supplier statement reconcilers b a project review? Supporting a council where they came under attack from a UKIP councillor
- Actually you wont Suppliers will write back credits after a time can be as little as 6 months!! Vat will be lost for ever You will never find some credits if you donāt do a project regularly
- Cost benefit analysis 99.95%
- Understood Light touch Aim for Ā½ hour of your time every week Sensitive to timing We sit in clients chair Russell Ward
- This has a different duration to that of the Gantt chart ā the chart looks at the live implementation phase of the project, whereas this graph gives indication of totality.
- Deal with suppliers all the time Mostly they want to do the right thing Need to be polite persistent Deal with same suppliers for many clients ā used to dealing with specific clients