A 50-physician medical specialty practice in the Miami area was acquired by a private equity sponsor in April 2019.
CrossCountry was initially engaged to assist with the post-close accounting requirements, including purchase accounting and calculation of the working capital adjustment, as well as the conversion from cash to accrual-basis accounting.
In addition, we were to provide a comprehensive assessment of the finance & accounting function and develop a standardized physician compensation model.
Based on the success of these efforts, a subsequent engagement entailed:
- Supporting the year-end audit process by coordinating and preparing supporting documentation and drafting the audited consolidated financial statements;
- Reengineering the financial closing process and contributing process dependencies that drove delays in the close.
- Developing a 13-week cash flow and leverage ratio forecasting model and creating a debt covenant calculation template.
- Implementing a new ERP system (Sage Intacct) and supporting acquisition onboarding for a 30-physician practice.
Our team of experts went to work by performing an in-depth assessment of all seven functional areas comprising the Office of the CFO (OCFO). Throughout this process, we were able to identify:
- Process and design flaws.
- Technology limitations.
- Actionable steps to redesign the organization.
- Specific skillset profiles required to enhance the existing accounting function.
We worked closely with management and physicians to understand existing compensation models across all locations and interview experts to identify industry best practices. Working in tandem with stakeholders throughout the organization, we completed a redesign of the compensation model which aligned physician remuneration with the company's short- and long-term objectives.
Our team accomplished a number of key milestones along the way, including:
- Creating audit-ready accounting records, process and controls memos, and purchase accounting documentation.
- Developing and implementing a streamlined financial close process to be used in future periods and to facilitate future audits.
- Building an automated 13-week cash flow forecasting tool and debt covenant calculation.
- Implementing a new ERP system and architecting a solution to provide efficient processes and robust reporting to support organizational needs.
CrossCountry's commitment to excellence was a throughline in the partnership. Overall, our impact was measured in:
Increased Financial Function ROI
- Improved efficiency and effectiveness of the finance function, including its ability to onboard new acquisitions.
- Created comprehensive OCFO Roadmap to guide management in transforming the organization and inform future investment decisions.
Optimized Compensation Model
- Aligned physician compensation and incentives with organizational goals. The new standardized model allowed for increased transparency, improved physician satisfaction. It also led to streamlined compensation calculations and reduced the administrative burden on the accounting team.
Cash Flow Forecasting
- Built a cash flow forecasting tool enabling management to identify and address liquidity issues on a timely basis, while supporting better decisions regarding timing of investments, payables management, etc.
- Implemented a customized ERP solution which further streamlined finance and operations, while driving improved real-time reporting.