Our client is a globally renowned developer of AI-powered enterprise translation and localization solutions. They serve top brands on multiple continents with their platform, which offers human-based, technology-supported translation services, enabling organizations to launch without a hitch into new markets and fuel customer engagement, all with hassle-free localization in more than 70 languages. Being a pioneer in translation and interpretation services, such as text, audio, and video translations, they help global brands speed up market readiness.

The client approached us with the request to automate and streamline their invoicing and prepaid reserved capacity management for better financial management.

For growing service businesses, managing prepaid capacity involves much more than tracking customer balances. Without effective automation, finance teams may struggle with processing delays, inaccurate revenue reporting, and the risk of both revenue loss and underutilization.

The client approached us with the need to automate the process where their customers could prepay for services, and have those funds deducted from their advance balance as the services were utilized, rather than being recorded as a one-time gain in our client’s financial books.

Without an automated process, they encountered a number of difficulties:

· Financial statements incorrectly reflected revenue spikes during the prepayment month and abrupt losses in the following months when services were indeed consumed.

· Difficulty in manually tracking deferred revenue while accommodating exceptions.

· Mixed purchases (software + services) on a single order had to be manually split, which caused delay and errors.

· Manually creating sales orders and invoices, and splitting the items in the sales orders into software and services for applying the prepayment because only the service items were qualified for the prepayment option.

· Additional administrative work, draining resources that could otherwise be utilized for growth.

The client found the need for a solution to automate these processes, ensure compliance, and offer real-time visibility to enable strategic decision-making.

Based on the client's requirements, our experts developed a prepaid capacity management and invoicing framework.

· Prepayment Usage Tracking: Developed real-time functionality in NetSuite to precisely track prepaid balances, allowing automatic deduction as services were used.

· Deferred Revenue Automation: Established prepaid funds to be booked as revenue only after service delivery, with accurate and compliant financial reporting.

· Intelligent Item Split: Developed logic to separate service and non-service items, enabling prepayments to be posted where desired, without manual effort.

· Dynamic Sales Order & Invoicing Workflows: Automated end-to-end workflows for sales orders, invoicing, and revenue allocation. Creation of sales orders and invoices triggered by the service request combinations of customers.

o Service orders used prepaid balances.

o Software-only orders created standard invoices.

o Hybrid workflow for mixed orders, with prepayment drawdown and partial invoicing if required.

· Custom PDF and Email Templates: Designed tailored sales order and invoice PDFs, and email templates for better customer communication and clarity.

· Accurate Revenue Recognition: Integrated the prepaid tracking mechanism with NetSuite's revenue recognition module. Facilitated precise revenue booking on the basis of the consumption patterns.

· Effortless reporting: Empowered finance and leadership teams to view current reports on prepaid usage, outstanding balances, and consumption trends.

Several complexities occurred during implementation, such as:

· Calculating and applying prepayments to services accurately and with appropriate accounting was a great challenge. Customers utilized prepaid services at varying rates, requiring flexible tracking mechanism.

· Differentiating between service and software items within a single invoice required careful customization.

· Splitting service items dynamically based on available prepaid balances. When a customer's prepayment wasn't sufficient to cover the services provided, the system was required to split service items into prepayment-applied and invoice-due categories sensibly.

· It was essential to accurately track prepayment balances, including fractional usage amounts, to ensure correct allocation.

· Providing smooth conversion from deferred revenue to revenue with accurate financial reporting.

Workaround: We implemented real-time data synchronization between prepaid transactions and NetSuite's financial modules to ensure accuracy and automation.

Our tailored solution successfully solved the client's issues, which led to notable enhancements in financial precision and operational efficiency. With automated prepaid reserved capacity management, finance teams spend less time generating, splitting, and reconciling invoices.

The solution offered precise splitting of software and service items, lowering errors and improving invoice clarity. Prepayments were allocated as deferred revenue and systematically transferred to the income account upon service consumption, ensuring that financial reports reflected revenue over time rather than as a lump sum at the time of prepayment.

Automated processes simplified the billing process, providing timely and accurate invoices to customers. Customers and finance teams both enjoyed real-time visibility into prepaid balances, better enabling them to manage finances. Furthermore, automation reduced manual effort, eliminating errors and inefficiencies while improving overall financial control.

Automation removes manual interventions, resulting in smoother audits and quicker financial closures. The solution can scale to new service lines, geographies, or pricing models as the firm expands.

Key Achievements

· Operational efficiency has been improved by 60% through automation of invoice splitting, while minimizing errors and processing time.

· Revenue is being realized in line with service delivery, improving reporting and compliance.

· Reports that are precise, providing transparent visibility into prepaid balances and consumption of services.

· Quicker and more precise financial closing due to better revenue recognition and compliance.

By automating prepaid reserved capacity management and invoicing in NetSuite, the client has achieved greater efficiency, accuracy, and transparency in their financial processes, ultimately improving both internal operations and customer experience. The solution guarantees prepaid balances are utilized effectively, invoices are processed on time, and financial processes are optimized.

This solution is scalable and can be tailored for companies that have prepayment plans for services across various industries. Future integrations with other payment gateways and financial solutions to further automate and enrich features are feasible. The client may also extend the automation feature to support even more sophisticated payment schemes. This can be extended to global subsidiaries with support for multiple currencies.

Ready to Automate Your Prepaid Service Management?

If your organization wishes to drive efficiency, accuracy, and growth through Oracle NetSuite ERP, Jobin & Jismi's experienced team is ready to help. Contact us now and find out how we deliver change through smart ERP solutions.

For further details or to discuss your needs, reach out to us today!