Corporate Wide Automated AR:
Pall Corporation Case Study

In 2005, the Global Filtration leader Pall Corporation set out to review and improve their North American receivables process. Working with Wachovia Bank and Cashbook, they designed and implemented an automated solution that covers 15 financial divisions and 5 distributed sites across the continent. Creating synergies across departments and improving communication across the different locations proved to be contributing factors to the success of this project which has starting delivering tangible benefits to the New York-based innovator.

Two years ago, Pall Corporation set about reviewing internal processes across different divisions in North America. One area that caught their attention was an Automated Accounts Receivable process in operation at their USF Filtration site in Timonium, just outside Baltimore. In Timonium, the Finance department was using the Cashbook AR Lockbox solution to take bank information in an electronic format in order to reconcile with open Invoices on Accounts Receivable. The solution had been in place since 1998 and effectively removed most of the manual effort associated with processing receivables. Automated matching rates averaged in excess of 80% and for some daily batches even went as high as 100%.

Towards the end of 2005, Nick Gilas, Controller at Pall’s Industrial Division, and his team started working with Cashbook to examine the feasibility of taking the automated A/R principle and applying it across the company’s different divisions spread across the country. Pall had already started a process of consolidating all company data onto one central server. Pall had also started looking at replacing the multiple different historical bank services set up around the country into one consolidated processing facility through Wachovia.

Nick Gilas says that the Lockbox project ranked in the Top 10 corporate initiatives at the Filtration and Separation Group and he describes some of the advantages of the system now in place from his office in Port Washington, New York: “We have found that the whole process of reorganizing how we look at our customers across the Group has already brought significant benefits to the Credit team. We embarked on this project to improve how we are doing things as a company and we are very pleased with all of the work completed on this initiative by our team working in conjunction with Cashbook. Since Go-Live we have now seen a 10% reduction at many of our sites with DSO dropping below 40 days for some business units.”

There were several key elements to the initial design phase of the project which kicked off in early 2006. The first component was reviewing the underlying Financial data structure in Pall’s Enterprise Resource Planning platform, MAPICS from INFOR. While all of the companies were now housed on one machine, there were multiple environments and release versions set up for the five physical sites and 15 different divisions. Another key component of the project was analyzing data coming from the bank and ensuring that the reference data provided by the many different customers dealing with multiple divisions could be understood and reconciled in the same way as at the original site in Timonium.

The objective of the target system was quite straightforward, explains Richard Birchall, Business Development Manager at Cashbook: “Take one source of receipt data on a daily basis and apply cash from that source across all of the different invoices available on the system across multiple environments and divisions. Some of the criteria that were used for the cascading algorithms included standard features such as Invoice amount and number, Purchase Order number, Sales Order number, Discount amount and Discount due date. In addition, other specific fields were added to the system to ensure maximized matching, such as Pick List number, Packing List number, Shipment number. Registered Bank Account numbers were also leveraged in the system to identify who was paying what.”

Birchall describes the project as one of the most important the Irish financial software company has undertaken in the past two years: “This project takes our Automated AR solution from being a good single-site story to the level of a robust, corporate-wide platform for billion-dollar companies who know that managing their most important asset – Cash – is a mission critical activity every day of the week.”