#7 ‐ Accounts Receivable and Payable
Accounts Receivable (AR): Four out of seventeen Bureaus who
commented on the AR module feel that the setup and design of
Accounts Receivable (AR) within SAP did not include their needs. This
is likely due to the fact that central accounting services within OMF
process the vast majority of AR transactions for City Bureaus; only a
few other Bureaus have need of an AR system.
Accounts Payable (AP): In addition, OMF reports that the ability of
SAP to process electronic vendor payments has not been fully utilized. This is an integral part of an efficient AP
system. Check writing is a costly, time‐consuming, paper and manual process easily automated in SAP. EBS
estimates the costs of the automated tasks to print and send each paper check is about $3; the non‐automated
aspects of the current process are not easily measured but would add to that cost.
Recommended Action Steps
(Related to Findings H1 – H2)
AR: The AR module has only been set up to address the needs of the central services Bureaus. AKT
recommends that EBS looks at the specific requirements of the four Bureaus reporting AR recordkeeping needs
and determine what additional functionality will be required to meet those needs. The Fire Bureau is unable to
use the AR module, for example, to bill and track payment for more than 30,000 customers. When EBS
performs its evaluation of the four Bureaus, it needs to consider the cost of the additional functionality against
third party alternatives that may be less expensive.
AP: AKT recommends EBS determine the cost and benefit of designing and implementing the electronic
vendor payment module of SAP. This determination, like the AR situation, needs to consider the needs of
Bureaus outside of central services before becoming final.
AR: AKT recognizes that while this recommendation does not have a significant impact at the City level, there
are City Bureaus with a real need for an AR system to conduct their work. Addressing these needs will help
these Bureaus focus on their true work through the elimination of inefficient workarounds.
AP: The implementation of electronic payments should have a direct saving to the City measurable through
the number of paper checks eliminated. There may be a modest impact on cash flow and interest lost through
the time value of money, however timely payments positively impact the City’s credit ratings.