Payment System Overhaul Plagued by Technical Difficulties

A local municipality is currently facing notable challenges in processing payments,resulting in a considerable backlog of outstanding invoices. The issues stem from the implementation of a new purchasing and payment system, AFIS, which went live on January 1st. The transition,intended to streamline operations,has instead led to multiple delays and complications.

Mounting Debts: A Breakdown of the Invoice Crisis

The municipality is currently contending with a backlog of 12,772 invoices that have surpassed their payment deadlines. While this figure represents an enhancement from the 27,000 late invoices reported in February, it still indicates a significant strain on the municipality’s financial operations and relationships with its suppliers. This situation mirrors similar challenges faced by other municipalities implementing new financial systems, where initial disruptions can led to temporary payment delays.

Proactive Measures: Advance Payments to Alleviate Supplier burden

in an effort to mitigate the impact on its suppliers, the municipality has offered advance payments to 32 key vendors who collectively have approximately 12,000 outstanding invoices. Around half of these invoices are overdue, highlighting the urgency of the situation. This proactive approach aims to maintain positive relationships with suppliers and ensure the continued provision of essential services. According to a recent survey by the National Association of Public Procurement (NAPP), early payment programs can improve supplier satisfaction by up to 30%.

A Timeline of Technical Setbacks

the problems began in early December with the shutdown of the previous billing system. The transfer of unprocessed invoices to AFIS was immediatly hampered by a technical glitch. Once resolved, the loading of 21,000 invoices that had accumulated during the system transition encountered further obstacles. A critical issue arose with the AFIS recognition system, which is designed to automatically process a large volume of invoices. The system’s failure to properly recognize invoices forced staff to manually handle each one, a process that proved to be significantly more time-consuming than anticipated. A subsequent software update has been implemented to address this issue.

The manual opening and handling of invoices lasted longer than expected, also consequently of a technical problem. A software update has sence been implemented for this.

Increased Staffing to Tackle the Backlog

To address the growing backlog, the municipality has increased its staffing levels dedicated to creditor management. Initially, 50 full-time employees (FTEs) were assigned to the task. That number has as grown to 60 FTEs, with further additions planned in the coming months. This investment in personnel reflects the municipality’s commitment to resolving the payment issues as quickly as possible.

Political Scrutiny: Alderman to Face City Council Committee

The ongoing invoice problems have drawn the attention of the city council. Alderman Van Buren is scheduled to appear before a committee on thursday to provide an update on the situation and answer questions regarding the delays and the measures being taken to resolve them. This scrutiny underscores the importance of transparency and accountability in addressing the municipality’s financial challenges.