Industry Success Stories
Delivering care and new treatment capabilities to patients is your focus. Building strong Accounting & Finance, Risk & Compliance, and Business & Technology capabilities can help you do so cost effectively.
Advising on strategy and analyzing specific growth alternatives
A healthcare franchiser had experienced significant growth in the number of franchises, which made managing the business more complex and impacted costs. Senior management decided to investigate alternatives to make the franchises more efficient and profitable. They came to Aventine Hill Partners for assistance in evaluating options.
One of our CFO Advisors stepped in on a consulting basis to assess options available to this company. Senior management was considering more standardization and providing value-added services to the franchisees.
Our CFO Advisor analyzed the current revenue and cost structure, then developed models of how revenue and costs would change under different franchise models. Some scenarios were analyzed in detail, such as an option to create a turn-key franchise structure where the franchiser defined a standard office and financed or leased it to the franchisee.
The Advisor created a financial model that demonstrated the impacts on revenue, cost, and profitability under different pricing scenarios and reviewed the details with senior management and the Board. The model was revised on an iterative basis and legal & regulatory research was performed on the most promising scenarios. This allowed the company to understand what changes in the business environment they needed to influence to pursue the strategy. And, how they should position their resources to be be ready when the timing was right.
Thanks to the help of Aventine Hill Partners' CFO Advisory services, this healthcare organization now has a strategic roadmap that it can begin executing at the optimal time, gaining a "time-to-market" advantage on their competitors.
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Assessing the impacts of new Revenue Recognition rules on a large, public company
A publicly-held, global provider of healthcare equipment wanted to be confident in meeting the 2018 deadline to adopt the new Revenue Recognition accounting standard. With an already busy accounting organization and desiring external expertise, they came to Aventine Hill Partners' Technical Accounting team for help.
We provided a team consisting of a CFO Advisor and a Director of Accounting and Finance, both of whom had researched the new Revenue Recognition guidance and helped create Aventine Hill's assessment and implementation methodology. Working closely with the controller’s organization, our consultants created a customized approach that addressed the unique aspects of this company's global operations.
Because the new standard involves making judgments on how to apply principles-based guidance and rules, a governance process was established to engage stakeholders in a transparent and collaborative decision-making process. A detail project plan was agreed to so that the assessment could be completed efficiently. The tasks performed included:
- Analyzing and classifying the company's revenue streams to refine the scope of the project.
- Reviewing and classifying a sample of customer contracts to target more detailed analyses.
- Analyzing individual customer contracts and identifying the performance obligations and transaction price in the contracts.
- Performing detailed research and preparing whitepapers on unique issues requiring judgments in applying the revenue recognition rules.
- Preparing pro-forma future footnote disclosures under the new guidance.
- Recommending changes in terms for future customer contracts that would better support the company's business and accounting.
To wrap up the project and finalize alignment among the stakeholders, our team delivered a summary report that described the project activities; documented the key judgments made by the company; and detailed the bases for the company's conclusions.
With help of Aventine Hill's Technical Accounting team, this global company now understands the impact the new Revenue Recognition accounting guidance will have on its financial results and disclosures. Going forward, management can focus its accounting efforts on the categories of contracts that will be impacted by the new rules. The information gained from the project will be used to educate operational and sales personnel on best practices related to customer contracts; establish a central company-wide repository for customer contracts; and develop a roadmap to update the Company’s accounting software to enable it to produce the required disclosures.
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Improving franchise royalty calculations and reporting
A healthcare franchiser had experienced significant growth and was concerned that its royalty revenue processes were not performing efficiently for the new scale. Aventine Hill Partners was brought in to improve the accuracy and timeliness of the processes and reporting; and to fill a key vacancy on an interim basis.
Our accounting and finance consultant began by analyzing the franchise contracts and developing a template for how the the royalties should be calculated.
- The processes that franchisees used to self-report were analyzed to identify gaps and improvement opportunities.
- The amounts being reported were compared to the royalty calculation template to identify variances and inconsistencies.
It was determined that royalty payments were being under-reported, directly impacting the franchisers top-line revenue.
A new royalty revenue process was defined that would be simpler for the franchisees to operate and more accurate. A training video was made to educate all offices on the process and the calculations. The set-up process for new offices was improved to assure that calculations would be correct for new franchisees.
During this period, the company experienced a vacancy in a key accounting role. Through our Project and Interim Solutions service, one of our consultants filled in as Interim Internal Reporting Manager. During this tenure, our consultant cleaned up the past two years of financial history and prepared documentation of the accounting procedures to assure that newly hired personnel would be able to easily assume responsibility.
Through the assistance of Aventine Hill Partners, this healthcare organization was able to improve its top-line revenue and the overall efficiency and accuracy of its back office accounting.
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Improving medical billing and physician payment processes
A for-profit medical practice implemented a new Electronic Medical Records capability and was having challenges in integrating the EMR with insurers and its own back office ERP system. Their CPA firm was concerned that tax filings would ultimately be impacted so referred them to Aventine Hill Partners.
Our Accounting and Finance Practice Director performed an initial assessment then deployed two consultants to address the urgent issues. One focused on the accounting set-up and processes. The second focused on physician payroll processes.
The organization was upgrading their ERP and implementing a new chart of accounts. Our accounting and finance consultant reviewed the mapping and made corrections to assure that transactions would post correctly. Next, detailed reviews of past accounting transactions were performed and correcting entries made to create a clean general ledger. A/R and A/P were reconciled and brought current. New physician financial statement reporting was developed.
Concurrent with the above work, our payroll accounting consultant took on the manual processing of physician payments. This addressed the immediate issue of late payments and allowed the consultant to develop a detail understanding of how the physician payroll currently operated. As part of the ERP upgrade, improved payroll processes were defined and implemented that were integrated with the improved physician statement reporting.
With the assistance of Aventine Hill Partners, this medical practice was able to pay its physicians accurately and timely; and produce accurate financial statements. The original concern that tax returns would be late was avoided. Required financial information was provided to the CPA firm accurately and on-time. Learn more about our Accounting and Finance practice areas.
Project and Interim Solutions
Providing a team to perform transition services after a divestiture
A large medical device company divested a business unit. The transaction included providing an extended period of transition services to the buyer. A parallel accounting function was required to segregate the divested business unit from ongoing operations. Aventine Hill Partners was engaged to help make the accounting and finance transition successful.
Collaborating with key accounting personnel from the company, the structure and resource requirements for the transition services team were defined before the divestiture closed. Utilizing our Project and Interim Solutions capabilities, we quickly provided accounting and finance professionals to assist in achieving an accurate transaction cut-off for both balance sheet and P&L items.
The company cloned its ERP system to create a separate accounting system for the divested business unit. The transition accounting function was established utilizing management from the company and a team of six consultants from Aventine Hill Partners with expertise in corporate accounting functions, including month-end close, cut-off procedures, and tax support.
For more than a year, the transition team performed a full range of accounting functions. Month-end close and financial reporting was coordinated and performed. A/R and A/P processing was kept current. Balance sheet reconciliations were maintained. The buyer's accounting department was provided with financial information required to consolidate its own financial statements.
With the assistance of Aventine Hill Partners, this company was able to quickly create and support a complex and extended transition services agreement for a divested business. The transition was cost-effective and ongoing business operations were not impacted by the transition requirements.
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