Our work with a quoted Applications Services Provider (ASP) involved supporting them with the structuring of deferred payments terms for the provision of a hosted ERP platform for a large NHS Acute Hospital Trust in the Midlands. The contract was NHS Standard Managed Services Terms. The software vendor, Cedar Software,  delivered the licensing and, over a period of 5 months, the implementation of the £420,000 software solution.  Our ASP’s role would be to host the software in its datacenter in N England and support it through its help desk and remote management capabilities

The requirement:
Cedar Software, a large and well established software house specialising in the integration of Finance, HR and Enterprise processes, had won a tender to supply their system to the Trust on the basis that it would be delivered under an OJEU contract and that payment for the system would be facilitated over 5 years.

The Trust had a budget problem, wished to treat our charges as part of the general service charge in the contract and wished to minimise irrecoverable VAT. 

Cedar  required cash for each of the 2-stages of the  implementation: firstly, the licence fee on acceptance by the Trust of the licence; and second, payment for the implementation stages

The solution:
AFM Solutions agreed with the Trust amendments to NHS Standard T&Cs such that, on acceptance of the licence and the subsequent stages of the implementation, our ASP partner would receive the cash value and reimburse Cedar for the licence and professional fees, retaining any margin it had built into the calculation

The benefits to the Trust:
 We delivered 2 key benefits:

  • The Trust conserved its capital budget under the Capital Accounting Manual.
  • VAT reclaim on the service charges

The benefit to the ASP and Cedar:
Cedar Software won the tender with our ASP and AFM Solutions delivered the cash up front for the set up costs and, importantly the software licence and implementation