Case Studies
What you don’t know can cost you. See specifically how a Connolly audit can help you identify issues, recover funds, reduce risks, and improve processes.
Click on a title for a detailed case study: |
|
Issue identified: A major retailer was not getting its negotiated share of fixture allowances.
Solution: Connolly’s audit sourced the original vendor agreement, identified that the retailer had only received $400k of the $1.4M fixture allowance due per the agreement. Connolly secured the remaining $1M balance for the client and collaborated with the client’s team to institute a formal process that closely reviewed vendor documentation to ensure all allowances were captured.
Benefits: Improved profits; Ensured agreement executed as intended; Established better business controls for the future Issue identified: A large retailer was not getting price protection on its current inventory from an electronics supplier.
Solution: Connolly’s audit identified a large promotional purchase that reduced the product’s retail price. During the promotion, however, retail sales of this product far exceeded the amount purchased specifically for the promotion. It was in fact determined that most of the product received and sold at retail for the promotion was paid for at the higher non-promotional cost. Connolly built the supporting documentation and recovered $327k in price protection funds due the retailer per industry standards.
Benefits: Improved product margins; More accurate assessment of promotion success; Precedent for vendor to provide price-protection in future Issue identified: A large pharmacy retailer’s indirect purchase contract with a major pharmaceutical manufacturer had different effective dates for rebates when compared to quarterly rebate terms.
Solution: Connolly’s audit determined the exact details for every change in both terms and timing for the contract period. In their research, the auditors worked closely with the manufacturer to rectify the discrepancies, ensure the accuracy of the financial calculations, and recover nearly $800k for the pharmacy retailer – a 25% understatement of rebate dollars due the retailer.
Benefits: Improved profits; Ensured contract terms executed as intended; Established better business controls for the future
Issue identified: A large retail client was improperly reporting general ledger items such as credit balances and un-cashed checks - instead recording these items as miscellaneous income; not in compliance with unclaimed property laws.
Solution: The Connolly audit systematically contacted vendors to resolve outstanding checks and documented all correspondence to ensure the client was in full compliance with the law. As a result, fines for improperly recording unclaimed property as income were avoided, and over $220,000 in over-escheated items were reversed. Furthermore, Connolly advised the retailer that by adopting proper controls and establishing a proactive reduction strategy, the client could reduce future escheatable property by 50%.
Benefits: Reduction of legal risk; Avoidance of regulatory fines; Improvement of accounting practicesIssue identified: A large retailer did not have visibility into a carrier’s expedited shipments weighing less than 100lbs, due to data file incompatibility.
Solution: Connolly’s audit obtained copies of the electronic files and successfully converted them into a compatible format for review. The subsequent review recovered $900k in improper freight charges due to routing guide violations. Connolly’s Data Analysts shared their conversion techniques with the retailer’s IT resources, teaching them how to convert and interpret the data.
Benefits: Improved adherence to routing guide; Better predictability of freight operations; Total visibility into freight handling charges |
|
|
|
|