Texas-based Corporate Managing Systems (CMS) owns and operates 14 individual loan outlets. For years, each location managed its own accounting using QuickBooks software. But this decentralized process made it extremely time consuming to synthesize financial information for corporate reporting. Also, loan brokers at each CMS managed branch were responsible for making journal entries into the accounting system. In addition to resulting in occasional data entry errors, this practice limited the company’s ability to institute rigorous accounting control and oversight. After deploying Microsoft Dynamics GP software, the company has gained improved business process control, enhanced system integration, and increased operational efficiency.
Situation
Corporate Managing Systems (CMS) is a Texas-based company that specializes in brokering short-term loans, widely known as “payday loans.” Because Texas law requires lenders to service their loans through an independent financial institution, CMS relies on Rite Money, a strategic partner and an independently owned and managed financial institution, to finance the loans it secures for its customers.
The company maintains 12 loan offices in Texas and two additional offices outside of the state. For years, each location maintained its own financial records using QuickBooks. This made producing company-level reports extremely difficult. “Each office kept its own set of books, and there was very little consistency from one location to the next,” says Dennis Scheer, CFO for Corporate Managing Systems. “Producing consolidated reports was very difficult with the old system because each office essentially acted like a separate entity.”
In addition to its need for better reporting capabilities, CMS wanted a way to increase its capacity for handling large numbers of transactions while simultaneously improving the accuracy of its accounting functions. Because the company’s loan brokers were responsible for recording journal entries in QuickBooks for each transaction they completed, they had less time to devote to working with customers and pursuing new sales leads.
CMS lacked a centralized accounting solution, so the company could not establish adequate internal controls. On occasion, discrepancies occurred between the company’s daily transaction total and the amount recorded for its bank deposit. One such inconsistency led company management to investigate the problem. Only after searching through stacks of paper and spreadsheets, the company realized that one of its employees had altered accounting records to cover up theft. “Using QuickBooks, any employee could easily make changes to the general ledger, which made internal control virtually impossible,” says Scheer. “Centralizing and tightening our accounting system was a huge priority.”
After years of maintaining separate accounting systems in QuickBooks for each of its 14 branch offices, CMS recognized the need for a fully integrated accounting solution. The company sought a comprehensive accounting system that could streamline operations at the individual offices while providing enhanced consolidation, in-depth financial analysis and reporting, and improved internal control capabilities at the corporate level.
Solution
In early 2006, CMS implementated Microsoft Dynamics™ GP. To help enhance the solution they integrated Microsoft Dynamics GP with J.E. Magic, a specialized software tool that enables CMS to import transaction data from all of its locations directly into the General Ledger in Microsoft Dynamics GP. CMS was able to transition the accounting system from QuickBooks to Microsoft Dynamics GP. “The implementation process went very smoothly for us. In a short period of time, we were able to not only drastically improve our accounting, but also increase efficiency across our entire operation,” explains Scheer.
Streamlining Business Processes
The company’s complex business model requires a considerable degree of agility. In addition to processing hundreds of daily transactions from 14 different offices, the company is required to integrate many of its key business functions with Rite Money. CMS takes advantage of the powerful data management and integration capacity of Microsoft Dynamics GP to streamline its daily close process and quickly complete updates to the general ledger. “By automating this process, our brokers are more productive and CMS interacts much more efficiently with Rite Money,” says Scheer.
Increasing Business Intelligence
CMS also uses Microsoft Dynamics GP to access consolidated financial information, which empowers company leaders to make more informed business decisions. Prior to implementing Microsoft Dynamics GP, accounting staff at CMS had to extract and compile data manually from spreadsheets maintained in 14 disparate systems. In addition, creating reports for strategic business analysis was extremely time consuming. “Monthly reporting took up to 12 hours because everything had to be done manually,” says Scheer. Now, the company uses Microsoft FRx® software to consolidate all of the data and produce a single monthly close report in minutes.
Benefits
By switching from QuickBooks to Microsoft Dynamics GP, the company has automated accounting processes and established tighter internal controls, helping CMS position itself for stronger growth.
Increased Productivity
CMS has taken advantage of the strong integration capacity and extensibility of Microsoft Dynamics GP to automate many of its core business functions, including its nightly close process. Microsoft Dynamics GP works with J.E. Magic software to import multiple journal entries directly into the company’s general ledger. Says Scheer, “Now, our loan brokers don’t have to worry about performing accounting tasks. Because of that, they’re working more efficiently.”
Annual Savings of $300,000
Because Microsoft Dynamics GP has helped CMS boost productivity, the company has realized tremendous cost savings. “We’ve actually been able to reduce our workforce by 30 percent because we’re able to manage the business much more effectively using Microsoft Dynamics GP,” says Scheer. CMS has saved approximately U.S.$300,000 a year, including the cost of an additional full-time accountant, as a result of switching from QuickBooks to Microsoft Dynamics GP.
Better Internal Process Control
By centralizing its accounting functions using Microsoft Dynamics GP, CMS has greatly improved its internal control capabilities. Prior to implementing the new solution, the loan brokers at each office had control of the accounting system and were responsible for recording journal entries, balancing accounts, and even making changes to the general ledger. Now, three accountants in the company’s corporate office manage the accounting for 14 different locations, using the powerful reporting and financial analysis tools in Microsoft Dynamics GP and Microsoft FRx to quickly access consolidated information.
