If required, a whole variety of more comprehensive management reports can be prepared and presented using powerful report writing features that enable users to custom design their specialized reports. These will enable the management team to drill down much further for more detailed analysis: the most or least profitable type of work; opportunities for more profitable jobs; where to target new business.
The Account's department is also involved in the invoicing process, in credit control and surveillance, debt chasing, handling tax rates, pre-payments, possibly working in multi currencies and dealing with accounts receivable.
With the right software solutions the accounts department are also able to manage employee expenses, record and pay supplier invoices, manage cash flows, reconcile accounts and offer historical reporting. Some of the latest MIS versions also feature currency handling solutions for global operations, forex (foreign exchange) sourcing or sales transactions.
Coming at the end of the MIS workflow modules that have been discussed in this book, the accounting and financial management process should be fully integrated and be able to draw on . with highest degree of speed and accuracy . all the information already entered, updated and confirmed as a job passes from estimating, through order processing, production, inventory control, quality control and costing.
This workflow process can again be seen in Figure 8.1.
Figure 8.1 Accounting and financial management comes at the end of the MIS business management workflow
The benefits of a good Accounting and Financial Management System are numerous and can incorporate multiple functions that include:
Monthly accounts of transactions
Open and failed quotes (in total and by sales person)
Cash Flow and EBITA analysis
Enhanced payment collection using electronic reminders linked to customers
Sources and uses of funds
Monthly Return and Statement Processing
Customer credit limits integrated with order entry and production
Estimate and credit limit warnings
Dispatch control against jobs on stop
Credit notes issues, by reason
Trial Balance and Balance Sheet
Annual reports and financial statements
Bank and Credit Card reconciliation
Budget vs Actual review reports
Fixed assets and depreciation tracking
THE ROLE OF DASHBOARDS
Some of the MIS financial management systems available today also offer ‘Dashboards’. Dashboards make use of color, graphs, symbols, and charts to help users quickly and easily review critical management and financial data.
This enables companies to take an immediate pulse of each department and quickly pinpoint problems.
By combining data from throughout the MIS system, dashboards create a visual command center where it becomes possible to monitor company performance (Figure 8.2) and launch profitable initiatives.
Since getting to the root of an issue may require more than a glance, each dashboard can have the ability to provide multi-level drilldowns, so as to quickly get the company back on track.
Each user of these systems can customize their dashboards by selecting from a list of available options that include cash position (Figure 8.3), net profit performance, late jobs, jobs due out each day, delivery by month (Figure 8.4) work-in-process analysis, sales metrics (Figure 8.5) and underperforming employees.
Figure 8.2 An example of a custom dashboard report looking at label company performance. Source- Label Traxx
Figure 8.3 Provides an executive report that monitors the cash position and cash trends. Source- Label Traxx
Figure 8.4. Shows on-time delivery by month. Source- Label Traxx
When looking at the cash position and trends, as shown in Figure 8.3, there are a range of graphical visuals displayed that can be used to show elements such as cash receipt trends, cash disbursement trends, days sales in accounts receivable and days sales in accounts payable.
Figure 8.4 is able to offer the management team the ability to analyze on time delivery by month and indicating the target goal (the red line) and the actual delivery performance that has been achieved.
On the left of the screen can be seen a listing of some of the other management dashboard options available for regularly managing the performance of the company as frequently as required . weekly, monthly, yearly or on-demand.
It is not really feasible in a publication such as this to show examples of all the many different levels of sales analysis, bookings, production performance trends, delivery statistics, cash flow against target, and much more.
Suffice to say that a good label or package printing industry financial and accounting MIS will have the capability of analysing and reporting on pretty-well any aspect of the company’s performance over any timescale required. It’s largely a question of sitting down with the MIS supplier and discussing what exactly is required, in what format and how often.
Businesses today undoubtedly have the opportunity to both analyze and manage their production and financial performance in a way that has never really been possible in the past. It is now possible to see at a glance what jobs make the best or least profit, what sectors are best targeted, where the highest margins can be achieved, what presses offer the best value, which employees offer the best value to the company. In short, there should be no excuses for poor performance and profitability as everything should be known, analyzed and dissected. Problem, non-performing or loss-making jobs can easily be seen, and hopefully remedied.
Figure 8.5 for example, provides a one week sales trend and cash position analysis.
The top left graph shows the trend for cash receipts; the top right graph shows the trend for cash disbursements. Moving to the bottom left, the graph highlights days sales in accounts receivable, while the bottom right graph shows days sales in accounts payable.
Figure 8.5 Provides a one-week sales trends/cash position analysis. Source- Label Traxx
With some MIS suppliers, ‘Accounts Receivable’ may be a separate fully integrated, fully functional module for managing billing, cash receipts, and receivable records that is proven to increase cash flows. All elements of creating and accurate invoice is done within the MIS, all job related purchase orders, all shipping and other charges or ‘extras’ , such as special tooling, handwork, etc. . are brought together for review before the final invoice is posted.
The system should also ensure that all shipped items are invoiced or, if required, create multiple invoice types to combine shipments, handle credit notes, or miscellaneous sales.
An important element of financial and accounts software packages is that of credit control. Powerful credit control integration will ideally be checking credit limits against work in process and account balances, as well as checking accounts on ‘stop’ status. This will ensure that jobs are not commenced in error. There should also be automatic live credit position viewing/checking at estimate, order, production and shipping stages, as well as the capability to flag and post invoices in dispute whilst queries are in existence.
Another features of many accounting and financial packages is the prompting of users when invoices are posted with invalid general or nominal ledger codes, allowing user to correct the code or alternatively direct to a suspense account. Indeed, sales and purchase invoice analysis and reporting should be a regular daily, weekly or monthly activity as required (see Figure 8.6).
Figure 8.6 Periodic analysis of sales invoices. Source- Tharstern
There can be little doubt that having a single system that manages customers, from the initial order entry through to final invoicing will significantly simply the whole production and administration process. Even if a company already has one of the leading accounts packages, such as Sage 50, Quickbooks Pro, Quickbooks online, or other SQL-based packages, these can usually be fully and seamlessly integrated into most MIS solutions.
If integrated with shop floor data collection some of the MIS management tools will also offer press operators a tool to consult their works schedule per machine and let them indicate what they are doing, and produce job traceability reports showing production steps, production, products and materials consumption details (Figure 8.7). A change in schedule is seen automatically on the shop floor, no need to redistribute lists.
Create semi-finished goods to track printed reels. Clockings and consumptions fill the post calculation and gives an insight into the profitability of your finished goods.
Figure 8.7 Job traceability report with production steps (upper part), production, products and material consumption details (lower part) for one job. Source- Cerm
Accounts Receivable and Accounts Payable provide all the inflows and outflows, while the General Ledger completes and complements the financial structure of the business.
Being able to understand how the business is doing at any time is all about knowing and understanding the production and financial information and numbers. Having this information in real time, from a single source, whenever it is needed, is key to running a financially successful label or package printing business.
Quite simply, today’s Accounting and Financial Management MIS software modules should enable label and package printing companies to operate with all the financial information they need to run a profitable business at their fingertips . almost instantly. Businesses should not really be getting into financial problems if they analyze the financials regularly and take appropriate remedial action(s) as soon as problems are identified.
Sadly however, studies from the UK, India and elsewhere tend to indicate that perhaps a quarter or third of label converters have a financial position that puts them into the caution or danger area in terms of financial viability . often on a quite long-term basis.
Improved financial management and control using good accounting and financial management MIs software will hopefully start to reduce these kinds of issues in the future.