What did you identify as strengths and weaknesses in their current system? In the analysis stage, what access was needed and what reports should be generated, what controls need to be included, etc.

riordan_mfg_financial_overview.pdf

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Overview

Riordan Manufacturing has three operating

entities…Georgia, Michigan and California…plus a joint

venture in the People's Republic of China. Basically, the

operating entities each have their own Finance & Accounting

Systems and they provide input that is consolidated at

Corporate…San Jose. The basic components of each

system are as follows:

General Ledger

Accounts Payable

Accounts Receivable

Order Entry

Procurement

Sales and Purchasing History

Invoicing and Shipping

Payroll

Financial Reporting

EDI

Bar Code Reading

EDSS (Executive Decision Support System)

San Jose Only

Background:

During the due diligence process in which Riordan acquired

the operating entities in Michigan and Georgia the matter of

F & A System's compatibility was not addressed.

Current Situation Regarding F & A Systems:

San Jose has a license for a fully integrated Windows based ERP manufacturing,

distribution and financial management software application specifically designed for

plastics processors and process and assembly manufacturers. The license does not

include application source code.

Michigan had purchased a vendor developed software application and the attendant

source code for their Fd & A and process application. The vendor is no longer in business.

The application runs on a pair of DEC Alpha's, using the VMS operating system, VAX4000

work stations and programmed in C.

Georgia had purchased a vendor (different from Michigan) developed software application

and the attendant source code for their F & A and manufacturing process applications.

The systems run on a pair of AS400's, using UNIX operating system, use PC's (Windows)

as workstations, and is programmed in RPG400.

Challenge:

The F & A Department has been unable to achieve anything remotely resembling "seamless

compatibility". Some F & A data is provided to corporate via data files; some data is provided

via hardcopy reports and must be re-entered; some data is provided via data files but must be

converted (redirected) to the proper account codes and the list goes on. Subsequently, Riordan

has the following situation regarding F & A system outputs at the consolidated level:

Consolidated close of the General Ledger and subsequently the Income Statement and

Balance Sheet is labor intensive and normally not completed until 15-20 days after month

end.

Audit (to include external auditors) is required each month and is costly and labor

intensive.

Compliance with new government required reporting requirements at the consolidated

level is difficult at best.

Riordan Enterprises finds the situation unacceptable and has mandated a

solutions(s)/alternatives be recommended soonest.

NOTE: This situation is transparent to customers and suppliers as each operating entity has

maintained invoicing, payments, etc., as was prior to acquisition.

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