Intermediate Platform for GAAP Waterfalling of Orthodontic Payments
Find Innovative SolutionsGenerate Solutions
Solution Overview
Problem
Orthodontic practices face challenges in adhering to GAAP principles due to complex payment structures with upfront and monthly payments, leading to inaccurate financial reporting, compliance issues, and increased administrative complexity.
Innovation Solution
A computer-implemented method that interfaces an intermediate platform with a practice management system and an accounting system, processes contract information to define payment types, and waterfall payments in accordance with GAAP to generate GAAP-adhering journal entries, using APIs for seamless data exchange and periodic data retrieval.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Measurement precision
If manual financial tracking methods are used in orthodontic practices with monthly payment plans, then administrative flexibility is maintained, but financial reporting accuracy and GAAP compliance deteriorate
Solution Approach 1:
The patent introduces an intermediate platform that acts as a mediator between the practice management system and the accounting system. This platform automatically processes contract information, applies GAAP waterfalling rules, and generates journal entries, thereby improving financial reporting accuracy without requiring direct complex integration between the practice management and accounting systems.
Solution Approach 2:
The patent segments the financial processing workflow into distinct modular components: contract information retrieval, payment structuring, GAAP rule application, journal entry generation, and financial statement preparation. This segmentation allows each component to be independently configured and maintained, reducing overall system complexity while improving accuracy.
2Reliability
If automated GAAP-compliant payment processing is implemented, then financial compliance and accuracy are improved, but administrative complexity and implementation difficulty worsen
Solution Approach 1:
The system enables self-service automation where the intermediate platform automatically retrieves contract information, applies GAAP waterfalling rules, and generates journal entries without requiring manual administrative intervention. This maintains high GAAP compliance while reducing the administrative burden on practice staff.
Solution Approach 2:
The patent implements preliminary configuration of GAAP waterfalling rules and payment structures in advance. Once configured, the system automatically applies these pre-established rules to all subsequent contracts, ensuring consistent GAAP compliance without requiring administrators to manually process each contract according to complex rules.
3Loss of information
If detailed contract information is processed and retained, then financial transparency and auditability are improved, but data security risks and privacy concerns worsen
Solution Approach 1:
The patent extracts only the necessary financial data elements required for GAAP compliance from complete contract information. The intermediate platform processes and retains only the specific payment terms, contract values, and financial metrics needed for accurate financial reporting, while excluding unnecessary personally identifiable information and sensitive patient data, thereby reducing security risks while maintaining financial completeness.
Data Source
AI summary
A method, computer program product, and computing system for: interfacing an intermediate platform with a practice management system; interfacing the intermediate platform with an accounting system; obtaining, on the intermediate platform, contract information from the practice management system; processing the contract information to define a contract type, an initial contract payment and a plurality of anticipated contract payments; and waterfalling the initial contract payment and the plurality of anticipated contract payments in accordance with GAAP to generate one or more GAAP-adhering journal entries concerning the plurality of anticipated contract payments.