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-Date: Sunday, 08 December 2013Sunday, 08 December 2013

CONFIDENTIAL Proposal For Online Auto Reconciliation for Coimbatore City Municipal Corporation

Submitted by:

Orbito Asia Technologies Systems Pvt LTd,

Address:

Email: vishnuvardhan@OrbitoAsia .com Contact Person Name: Vishnuvardhan T

This document is the property of Orbito Asia Technologies Pvt Ltd., who owns the copyright thereof. The information in this document is given in confidence and without the written consent of Orbito Asia Technologies Pvt Ltd., given by contract or otherwise, this document must not be copied, reprinted or reproduced in any material form, either wholly or in part. Also the contents of this document or any methods or techniques available there from, must not be disclosed.

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Section 1 Scope

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Auto Recon: Automatic Reconciliation using Imported Bank Statement


Overview Auto-Recon is web based application that provides a visual tool for managing bank statements that simplifies data entry into accounts. As soon as a statement is validated, the corresponding accounting entries are automatically generated by Auto-Recon. So non-accounting people can enter financial transactions without having to worry about things such as credit, debit and counterparts. This process assumes that the corporation receives an electronic bank statement from all banks and wishes to automatically reconcile it to the Financial Account in the system. The automatic reconciliation process involves 4 steps, one of them (step 2) is optional: 1. 2. 3. 4. Import the bank statement Post the bank statement Match using the imported bank statement Reconcile

Payment Process

To illustrate these steps we will assume that there are 1. Transactions in the Financial Account in the system that have now cleared through the banking system (i.e., they are showing on the bank statement and need to be marked as cleared in the

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Financial Account). 2. Transactions on the bank statement (for example bank fees) that need to be reflected in the Financial Account. We will illustrate this process using a Financial Account of type "Bank", as the process is (intentionally) not supported for Financial Accounts of type "Cash". We will use whichever matching algorithm is associates with the Financial Account we select.

3.

4.

The only requirement for Bank Account Reconciliation is for the bank to be able to provide a bank statement in electronic format. The statement must be entered into Auto-Recon, which then creates a main statement, balance information and of course all entry lines in the statement including cheque transactions. Bank Account Reconciliation then finds the corresponding bank entries in sales/purchase entries and reconciles them, or creates proposals for reconciliation, if there are multiple options. Bank Account Reconciliation can also automatically configure proposals for counter-entries in cash receipt. For example, if any direct payments have been made into accounts, you can find a debit entry, for example, from the annex number in the account statement's entry text. The system also generates automatic proposals in cash receipt, in the case of OCR payments, in which the payment ID is generated in accordance with Auto-Recon invoices or statement printouts. At the same time, Bank Account Reconciliation can create proposals for entry lines in cash receipt for interest, fees etc, which have been ascribed to the statement by the bank. This is done on the basis of the rules in the form of text strings that are configured for that purpose in the balancing rules. Finally, one can of course implement a manual balance of one or more bank entries.

How it Works
Reconciliation Process The reconciliation operation consists of matching entries in different accounts to indicate that they are related. Generally reconciliation is used for: Matching invoice entries to payments, so that invoices are marked as paid and customers do not get payment reminder letters for those entries (reconciliation in a customer account), Matching deposits and cheque withdrawals with their respective payments, Matching invoices and credit notes to cancel them out.

Reconciliation must be carried out on a list of accounting entries by an accountant, so that the sum of credits equals the sum of the debits for the matched entries. The scanned-in account statement lines should contain 3 reference fields, which are completed according to which bank the account statement comes from, and what the sender has attached. The fields are: Personal Reference, Entry Text and Sender Reference. The balance is implemented according to the following algorithm: Each account statement line is reviewed independently and, if there are several proposals, it will be reflected in the number of balance proposals. One must choose the correct line. First, Bank Account

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Balancing tries to find bank entries that correspond to the account statement lines for direct balance. The program looks for accounted payment entries on the basis of the Sender Reference field. For all payments made via Auto-Recon, it is best to complete the Sender Reference field with the unique UPR number. Completing the field is defined as described above via the Sender Reference code in the bank account card's "Payment" tab. The transaction number of the detected payment entry will then be used to find the corresponding bank entry, which is subsequently marked for balance. Then Bank Account Balancing tries to find closed debit entries, corresponding to the information in the statement line. This is executed on the basis of Debit No., Payment ID or Annex No. - and, of course, amount and date - If it finds a closed debit entry, it then finds the corresponding bank entry, which is then marked for balance. It then tries to find balance proposals by searching directly in bank entries on the basis of payment reference and then with amount and date as search keys.

If it still cannot find a bank entry for the statement entry line, Bank Account Balancing then runs through the open debit entries again with Debit No., Payment ID or Annex No. as search key. It does this in order to find debit entries, which have been paid without yet being registered in Auto-Recon. For open debit entries discovered on the basis of the latter method, Bank Account Balancing also sets up proposals for the payments in cash receipt ready for accounting. After accounting, payment will then be made and the corresponding bank entry can balance with the line in the account statement. Lines that have not yet been balanced correctly can be handled manually with the use of the "Balance" button. If it does not find any bank entry corresponding to the entry from the bank, it is possible to mark the line as "Manual management" and the system can now automatically set up a line in the cash receipt for further accounting.

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Bank Reconciliation Process Description


The bank reconciliation process contains automatic interface transactions as well as user intervention. When cheques are cashed at the bank or deposits are made, the bank sends transaction text files to AUTO-RECON. This information is processed into the AUTO-RECON automatically and this is referred to as an interface. If the transactions from the bank match off with their contra transactions, it will post automatically according to the transaction processing the rules that are set up by the system controller. If there is a discrepancy and the transaction does not match with a contra transaction, it will post to the relevant exception account and must be cleared to the correct account after the discrepancy has been resolved. The person responsible for clearing the Bank Reconciliation or Exceptions must obtain a bank statement from the bank and then request Matching reports on the following accounts. Exception Account (This is a system controlled account to post all unmatched bank reconciliation transactions. This account must be cleared on a monthly basis and must have a zero balance before month closure or year closure. This account is debited or credited and the Pay Master General (PMG) account is credited or debited). Bank Adjustment Account (this account is used to post incorrect debits (debit bank adjustment and credit the Exception Account) and incorrect credits (debit Exceptions and credit Bank Adjustment account) received from the bank. These transactions will be cleared as soon as a reversal is received. (For a debit amount debit Exceptions account and credit PMG Adjustment Account. For a credit amount credit Exception account and debit Bank adjustment account). Control Account (This account is credited with payments (for example salaries and pensions etc.,) (debit Outstanding payment and credit Control Account) and debited with bank debits received (debit Control Account and credit Pay master general Account).

Example Real Case of Using Reconciliation


Suppose that you are entering customer order details. You wonder what is outstanding on the customer account (that is the list of unpaid invoices and unreconciled payments. Auto-Recon opens a history of unreconciled accounting entries on screen.

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Unreconciled Accounting Entries After running the Reconcile Entries wizard, these lines can no longer be selected and will not appear when the entries are listed again. If there is a difference between the two entries, Auto-Recon suggests you to make an adjustment. This "write-off" is a compensating entry that enables a complete reconciliation. You must therefore specify the journal and the account to be used for the write-off. For example, if you want to reconcile the following entries: Entries for reconciliation Date Ref. Description Account Debit House Tax Water Tax 4010 2010 4010 544.50 100.00 644.00 Credit

12 May 13 INV23 25 May 13 INV44

31 May 13 PAY01 Tax Penalty

On reconciliation, Auto-Recon shows a difference of 0.50. At this stage you have two possibilities: do not reconcile, and the customer receives a request for 0.50, reconcile and accept an adjustment of 0.50 that you will take from the P&L account.

Auto-Recon generates the following entry automatically: Write-off account

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Date Date 03 Jun 11 03 Jun 11

Ref. Ref.

Description Description

Account Debit Credit Account Debit Credit 4010 XXX 0.50 0.50

AJ001 Adjustment: profits and losses AJ001 Adjustment: profits and losses

The two invoices and the payment will be reconciled in the first adjustment line. The two invoices will then be automatically marked as paid.

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Implementation Approach
This section explains the high-level strategy that Orbito Asia will be adopting for developing Online Auto Reconciliation for Coimbatore corporation bank accounts. Orbito Asia proposes to adapt agile project Management methodology for MIS. Agile development methodology attempts to provide many opportunities to assess the direction of a project throughout the development lifecycle. This is achieved through regular cadences of work, known as sprints or iterations, at the end of which teams must present a shippable increment of work. Thus by focusing on the repetition of abbreviated work cycles as well as the functional product they yield; agile methodology could be described as iterative and incremental. In an agile paradigm, every aspect of development requirements, design, etc. is continually revisited throughout the lifecycle. When a team stops and re-evaluates the direction of a project every two weeks, theres always time to steer it in another direction. The results of this inspect-and-adapt approach to development greatly reduce both development costs. And because a teams work cycle is limited to two weeks, it gives stakeholders recurring opportunities to calibrate releases for success in the real world.

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Solution Approach

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End-User and Ad hoc Reporting Generating reports is the most important task any data-management product has, presuming secure and valid data maintenance as a basic expectation. OATS products are designed to support reportgeneration with the tools you or your users are already comfortable with, as well as providing sophisticated integrated tools. Hundreds of existing reports support most standard reporting, and there is flexible support for new report generation. Some of the currently supported tools include: Microsofts Office Suite, including Excel, Access and Word, for many reporting, data extraction and analysis tasks. By extension, any of the other competing office productivity products which are ODBC compliant and capable, will work just as well. Discoverer, from MySQL., for point-and-click reporting, data mining and whatif analysis. BI reports for point and click report generation, especially where presentation-quality is important. Ad hoc reports can be developed by IS staff, proficient users, or OATS personnel using any of these tools, or any other SQL-compatible tool.

Relational Database: MySQL MySQL Enterprise provides the data-management needs for all OATS products, leveraging the advanced security of RHEL natively. MySQL provides a database environment which supports high reliability, data integrity, open systems accessibility, optimal throughput and high performance. Features such as afterimage and recovery-unit journaling, together with the ability to perform online database verifications and backups, work together to guarantee data reliability. Internal features such as primary/foreign keys and relational constraints support data integrity. MySQL systems access is provided by network features, cross-platform integration products and reliance on industry-standard SQL for query and update access. Multi-area and multi-file physical organization, hashed and sorted data indexes, data compression, physical and logical data placement controls all support highly optimized performance and throughput. In compliance with industry-standard clientserver application architectural principles, all business rules are coded in stored-SQL modules in the Offender Database or via callbacks. This means the business logic resides on the server. This design enhances OATS's product's modularity, making it straightforward and manageable to make deployment-specific customizations and enhancements to the product. Changes in business logic or database requirements do not require updates to client-side software. System Security We take system security issues very seriously each user account has access that can be customized, providing for every interaction to be mediated, controlled and potentially reportable. All programs and data objects are protected by Access Control Lists (ACLs); this scheme complies with the C-2 computer systems security rating specified by the MHA. No elevated or special access permissions or privileges are required by any user for normal use of the system. Password expirations and management policies can be specified and controlled by administrative staff according to the customers approved policies & procedures. All security features are the result of trusted kernel implementation (again, as required by MHA standards), and are not grafted on by after-market or

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application software provisions. This insures robustness, reliability of the security technology and implementation, and gives the customer control and flexibility in implementing their existing policies or implementing new department requirements quickly. Physical network security is compatible with current firewall technologies. OATS staff has extensive training and experience in firewall and protocol-oriented network security issues and technology and monitors new development regularly. OATS has extensive expertise in the realm of computer systems security; we have conducted systems security trainings and seminars, and have provided computer security consulting services for the Sikkim Department of Commercial Taxes, among others. Support for Support Staff Central Services can have integrated maximum of 24-365 support as per client requirement. This means customers and support staff can call at any time for assistance with everything from crisis management to routine account questions. Regular user-group meetings provide the opportunity to discuss general use issues and allow for face to face time with staff, and in-house visits can be arranged as needed. In-house installations get integrated initial configuration and orientation, several months minimum unlimited phone and in-house support, and the option of extended support. During covered support periods, experienced OATS staff are available at all times for individualized phone support, and on-site visits are scheduled for integration and available as needed after initial adoption. In short, OATS places a premium on supporting our clients, and focuses on empowering IT and IS staff with transparent technical backing. You'll never get dedicated support personnel with us. You talk to someone who helped build and install your system and is personally invested in your satisfaction.

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Section II Company Profile

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About Orbito Asia


Orbitoasia Technology Solutions is an Information Technology services, solutions and IT staffing solutions provider serving businesses globally, Headquartered in the Coimbatore, India. Orbitoasia is part of 500 Cr Megala Group of Companies. Orbitoasia is inspired to build the Next Generation IT Services & Solutions Company through Differentiated & Superior Customer Experience. We are dedicated to the success of our customers. Orbitoasia has sustained an impressive growth rate in both capability and profitability and is now positioned to be one of the major contributors in various sectors such as, Pharmaceutical & Life Sciences, Transportation, Media, Banking and Financial services, Insurance, Textile, Manufacturing, Retail, Utilities and others. At Orbitoasia, we are continually undergoing a transformation and reorientation in response to the rapidly evolving needs of our clients. Orbitoasia has in-depth experience of IT Services complemented with technical excellence and quality, to generate IT solutions for today and tomorrow. Orbitoasia helps to achieve real business results that allow you to transform, and not just maintain, your operations. Our IT services, business solutions, and outsourcing bring you a level of certainty that sets Orbitoasia apart from competitors. Youll experience requirements that are met on-time, within budget, and with high quality; greater efficiency and responsiveness to your business; and the ability to shift investment to strategic initiatives rather than tactical functions. Our Process compliance to ISO 9001:2008 and CMMi L3 will help our customers to get the value addition to their projects. In Orbitoasia we transform core functionalities of corporate with greater efficiency, lower cost and simpler approach. Our on-site / off-shore model with our unique turnaround time guide us to the global platform with conviction and transformation. Orbitoasia reaches across a broad spectrum, including Mobility Solutions, Big Data Solutions, Cloud Solutions and Testing. The solutions portfolio includes Consulting, Application Development & Management Infrastructure Managed Services, and Remote Infrastructure Management.

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1. Client References
Projects: AppIB URL: http://www.appib.com/

iCallDialer URL: http://www.icalldialer.com/

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Mimo URL: http://www.mymimoapp.com/

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Emitac URL: http://www.emitac-ees.ae/

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Allied health Care URL: http://www.silcock.com.au/

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Section III Financial Proposal

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DESCRIPTION S No
1
Manpower, Design and Development, Consultancy, Installation and delivery.

No Of Person Price (Rs) Months Required


12 9,00,000

Auto Reconciliation Module with basic reports(15 Nos) Integration with Bank Account for municipal corporation services (3 templates of bank statement + fixed services) Maintenance & Support/Annum Additional Services (if Required)

2,25,000

12

9,00,000

4 5

New Bank Statement formats (Services) Business Analytics and Reporting for Bank Reconciliation. Estimated Price for Development (Rs. Eleven Lacs and Twenty Five Thousand only) Estimated Price for Maintenance (Rs. Nine Lacs Only) Terms and Conditions. Payment Milestone:

1 10

75,000 6,00,000

11,25,000

9,00,000

M1

Mobilization fund along with firm Purchase order or work order. Release of Auto-Recon Module with one Template for Bank Account Statement Reconciliation Additional of 2 Template for Bank Account Statement with Basic Reporting Modules (35 Nos)

10%

M2

50%

M3

30%

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M4

Final UAT Maintenance Phase: Payment Paid on Monthly basis.

10%

Taxes: All applicable taxes extra.

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