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Borger Management Inc - Financial Accounting Assignment

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Added on  2019-09-30

Borger Management Inc - Financial Accounting Assignment

   Added on 2019-09-30

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Organization: Component: Submitted By: Date:Borger Management, Inc.Accounting DepartmentMarkeeda Guest-SpencerSeptember 17, 2016Description of the ProblemA Property Management Company uses many different accounting systems that don’t communicate with one another. The 1 person accounts payable department uses... Timberline Software. The 2 person accounts receivable department (as well as the 40 on-site property managers) uses Rentroll Software. The General Ledger and Financial Statements are maintained on MRI. None of the software is compatible to the other. Borger Management faces a problem of gathering information from different platforms and converting them to a single platform to create the financial statements.Business Activitiesand Processes Affected by the ProblemPreparing monthly financial statements for the property owners is a tedious week-long process. Outside consultants were hired to convert thedata from all of the various software packages so that it could then be imported into MRI. This process resulted in many errors every month.The monthly expenses for the consultants are massive. The system errors became more frequent and the 1-person IT department was unable to handle the increased system problems. Additionally, due to the multiple systems---true and accurate financial data is never available until month end.Actual Performance (e.g., current baseline)Presently, consultant fee expenses that are passed on to property owners are averaging $17,000 per month.Target PerformanceSaving time, man hours and money will drastically increase property owner profit, management fee revenue and owner satisfaction & retention.Performance GapCurrently, it takes 7 days to prepare reports working 10 hours a day i.e., 70 hours. So if we have a simple and combined software, it will reduce the work to 2 days i.e. 20 hours. Thus this will also reduce the cost. Hence all three time, man hours and money will be saved.Organizational KPI’s AffectedManagement Fee RevenuePrinciple StakeholdersCFO; Accounts Receivable department; Accounts Payable Department; IT Department; Property Owners.Tentative Solution StrategyCreating/Designing/Purchasing a single system with different modules (A/P, GL, A/R) that are able to communicate and produce data/reports inreal time.Acquisition Need/ConfirmationWe/I confirm that this problem can only be solved through the acquisition of IT services (and IT products as needed) from a contractor
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selected in open competition.Activity 2OBJECTIVE OF THE REQUIREMENTS:Reduce the amount of time and money required to prepare financial statements, as stated in the Performance Gap documentREQUIREMENTS CATEGORYREQUIREMENTS DEFINITION1. Stakeholder Considerations that Need to be Reflected in the Solution (including the expectations and satisfaction managers, internal users, and external customers) and factors related to the business environment)CFO seeks increased profit resulting from increased managementrevenue. Property owners benefit from having increased rent revenue as well as real-time financial statement available. 2. Factors to Take Into Account Related to the Business Environment (including legal factors, regulations, competition, and business cycles)Competitors have the capabilities described here3. New Capabilities and/or Functionality Required by a Solution (including requirements for ease of use, quality, interoperability, and data sharing)A software solution is needed that will eradicate the cumbersome data conversion process which will in turn increase the quality and accuracy of financial statement preparation.System must be able to capture data, integrate with other management functions (i.e. payroll imports) and produce accurate and reliable real-time financial reports. System must beuser friendly, fast and flexible, and able to cross function with allaccounting department needs. 4. Existing Business Process Shortfalls (why current business process and/or systems cannot meet the needs or be changed to meet the needs)Current software being used is dependent on outside consultant help for converting data into a useful format. The multiple accounting software modules cannot interface with one another. 5. Cost Limitations (may be stated in terms of preferred cost range; may specify a maximum cost; costfigures need to include associated overhead costs; may be specified as an annual limit or life cycle limit or both)Expected cost is $100,000 for software system design. Total project cost, including implementation and training and overhead, is expected to be between $250,000 to $300,000.6. Other Limitations or Constraints (e.g., availability of key personnel, such as subject matter experts, training methods and time available for training, limitations related to maintenance or to external support).Must be easy to learn. Off-site resident managers (end users) arenot overly familiar with computerized systems. Additionally, due to the small size of the IT department, the new software mustalso have high reliability with automatic online updates, reducingdependence on IT staff.7. Security & Privacy Requirements (any requirements beyond those currently being used by the organization for non-critical and non-sensitive applications)Upgraded server room with the highest security to avoid theft and damage. Updated firewalls to protect server data.8. Number to be Implemented (e.g., specify the number of places the solution will need to be implemented and whether they are at different geographical locations)The solution must be provided for four workstations in the corporate office, and 25 work stations at off-site resident manager offices throughout the Washington, DC area. 9. Schedule (explain any schedule constraint, whether for financial or non-financial reasons--e.g., if the solution be in place as of a certain date, specify the dateand why) Acquire and implement within next six months (01/01/17 - 06/30/17). Doing so within three months brings quicker financialbenefits.
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10. Other Requirements Not Specified Above (e.g., any related to vendors, consultants, partnerships with other entities, unique user interface requirements, documentation needs, special certification requirements)Due to IT department size and expertise, the new software must require minimal in-house support; online training and tech support is necessary.Activity 3OBJECTIVE:Reduce the amount of time and money required to prepare financial statements, as stated in the Performance Gap documentName of Solution AlternativeSummary Description of Solution That Meets the StatedRequirementsAlternative Solution #1: Acquirean In-house staff position toreplace consultantsHire an employee/employees whose major responsibility would beto take on the duties of the current consulting firm. Alternative Solution #2: HireSoftware Designer to create newaccounting softwareHire software designer to create a single accounting system which will have different modules yet in the same format. In other words,the new process will have different modules like: Accounts payable, Accounts receivable and general ledger.Alternative Solution #3: UseSoftware as a ServiceContract with a Software as a Service (SaaS) provider such as Quickbooks or Sage to obtain the functionality required via the Web.Alternative Solution #4: Re-negotiate with consultantsRe-negotiate contract with consultants. Perhaps they can train current staff to perform some of their duties to reduce consultant expenses.IT Acquisition ConfirmationEach alternative solution described above requires the acquisition of IT services from an external ITservice provider selected in open competition.
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