Performed integration and controllership support for a consulting firm

Performed integration and controllership support for a consulting firm

Stout performed integration and controllership support for a healthcare consulting firm.

The Problem: Widespread Inefficiencies

A private equity-backed portfolio company, a global provider of scientific communication and market access services, acquired a leading medical communications platform to expand its strategic partnership with pharma and biotech customers in the United States.

The acquiree had several immediate challenges resulting in widespread inefficiencies across finance and operations. Various legal entities operated on disparate reporting systems, and accounting teams already constricted by time and resources needed to conduct manual and time-intensive processes.

Additional issues included the following:

  • A leadership gap with no active CFO
  • Long-term contractors functioning as gatekeepers to key processes and client relationships across the finance and accounting functions
  • Minimal visibility into revenue drivers and project performance
  • Reliance on paper checks for vendor payables and customer receivables
  • Process misalignment across its four core legacy entities
  • Multiple non-integrated legacy acquisitions held by the acquirer

This resulted in pervasive personnel risk, untimely and unknown payment and invoice tracking, cash misapplication, and difficulties in tracking and managing aged accounts receivable.

Our Solution: A Holistic Approach

We met with the Global Finance Controller of the company to further understand the acquisition terms, business case, and extent of integration support needed to stabilize the acquiree’s finance function and optimize its current state reporting processes.

Following that, our team conducted interviews with acquiree leadership to understand the detailed current state of the finance function and identify process gaps and opportunities. We utilized the rapid assessment approach to examine the following:

  • Order to cash: Customer management, order and invoice management, revenue management, accounts receivable reporting and analysis, etc.
  • Procure to pay: Sourcing and contracting, requisition and procurement, invoice processing and payment, accounts payable reporting and analysis, etc.
  • Record to report: Subledger and general ledger close, financial consolidation process, month-end reporting, etc.

Additionally, we leveraged the results of the assessment to capture detailed observations, measured the magnitude of key risks, and developed tactical recommendations to harmonize and enhance the acquiree’s current processes.

Our team took a holistic approach by performing a risk assessment and developing a 90-day roadmap for achieving an optimized future-state operating model that addressed key risks. These recommendations aimed to streamline integration into the current IT systems and operating environment of the company.

The Outcome

Post-assessment, we assisted the company in implementing those process improvements over several months for the acquiree, which led to:

  • A consolidated invoice tracking mechanism that facilitated a timely and accurate cash application and collections process
  • Assistance and finalization of the paperless transition to ACH
  • Identification and mitigation of a potential multi-million-dollar federal compliance risk associated with proposed changes in disbursements
  • Connectivity between disparate reporting systems – specifically preparing for system migration to SAP By Design
  • A standardized approach to perform and record customer accruals
  • An exhaustive and centralized month-end close checklist
  • A 30-60-90 day roadmap of the future state target operating model
  • An integration plan to align finance processes across the four legacy entities at the acquiree
  • The recommendation to establish an enterprise-wide Integration Management Office to drive alignment across legacy entities

We also implemented change management protocol to limit the impact operational changes would have on company culture and existing client relationships.

Significant turnover in key finance positions occurred throughout the process improvement implementation. Understanding the impact of that turnover, our team provided interim controllership support across two major entities of the company to complete key month-end and year-end reporting tasks.

Our support and expertise in finance function stabilization enabled an easy transition into assisting the clean-up efforts and timely close processes across the two legacy entities. This allowed the company to maintain business continuity and meet its reporting deadlines. We also provided templatized solutions to ensure the company maintained streamlined close processes moving forward.

Following our assistance through multiple closes, the company required a longer-term solution to its interim controller gap that would guide them through an SAP By Design migration from various instances of QuickBooks. We identified a resource for the company and worked alongside the company to transition Interim Controllers, providing continuous stability across the entirety of revenue cycle management.

Stout as a Partner

As a result of the engagement, Stout served as a critical partner driving the integration efforts across entities and preparing the company for success in any future strategic transactions. Our efforts showcased our broad set of services and ability to stay agile with ever-changing assumptions to the company. We executed tactically, when necessary, while strategically working in conjunction with the proposed future-state roadmap.

With our support, company leadership now has the capacity to focus on strategic direction for the business while having confidence in its finance function.