We are a fast-growing, acquisitive company. As a result, our reporting requirements can change from month to month. IBM Cognos Controller provides us with a financial reporting system that is flexible and robust enough to cope with these changes, and supports us in our growth.
All3Media is an international group of television production and distribution companies, headquartered in London. The company has operations in the UK, Germany, Netherlands, USA and New Zealand, producing programmes such as Midsomer Murders, Skins, Shameless, Hollyoaks and Wild at Heart for television screens across the world.
All3Media has grown rapidly through its highly acquisitive strategy. The company has gone from six operations to fifteen in under five years. Although each organisation acquired retains a significant level of autonomy, they are required to adhere to All3Media’s group financial reporting process and timetable. This process includes monthly management reporting, budgeting, forecasting and statutory reporting.
Previously, this process was extremely manually intensive. The finance departments of each subsidiary would enter the figures into an Excel spreadsheet. The spreadsheet was emailed to the central finance team, who would consolidate the numbers to create a wide range of reports. This bottom-up approach became more of a challenge as the group grew.
“When All3Media was made up of six production companies, it was quick and easy to use spreadsheets to create the different reports,” says Julian Freeston, Deputy Group Finance Director of All3Media. “But as the Group expanded, there was an increase in both the degree of information requested at board level, and the corresponding number of spreadsheets that needed to be consolidated. It became unwieldy and very admin-intensive for the central finance team.” Further, as the spreadsheets were stand-alone schedules, control over their quality and format was made more difficult for the central finance team. This made it harder to consolidate the submissions into one Group report. “We were spending more time requesting changes to incorrectly submitted reports, and less time actually getting an understanding of the story behind the numbers,” says Freeston. The finance team also had to create a large number of management reports for a variety of audiences including the Group’s board of directors and financiers.
“Our management reporting requirements were widely distributed and spreadsheets weren’t able to provide the different levels of granularity each report demanded,” Freeston continues. All3Media decided to look for a more robust solution to help maintain strong financial reporting while the group continues to grow.
A solution from IBM Business Analytics, proved to be the answer.
The strategy and approach
All3Media chose IBM Cognos Controller to add robustness and accuracy to the Group’s financial reporting process and to reduce the amount of time taken to perform the consolidation of the overall Group numbers. Controller’s front end is in a familiar Excel spreadsheet-format so this feature would reduce the amount of
HAYNE Solutions was chosen to be the implementation partner for this project. “We needed a consultancy that has not only the relevant IT experience but also a good understanding of the finance function. Our main consultant, Neil Whitmore, from Hayne Solutions, had both technology and accountancy qualifications so brought the necessary hybrid of skills to support the roll-out,” says Freeston.
The benefits achieved
All3Media Group first used Controller to produce the year-end consolidation for Group statutory purposes, having performed a test run on the system using the previous year’s data. Within a few months, the system was rolled out to all management reporting and forecasting, including cash flow, profit and loss, and balance sheet analyses. These reports formed the basis of the monthly Group finance report that is circulated to all parties.
Freeston says that the benefits are clear. “Using Cognos Controller has removed a lot of the manual administration involved. The finance team is spending much less time on manually consolidating spreadsheets into larger reports, as the Web-based system automatically and quickly consolidates the local company returns into the Group reports we require.”
“Less time is spent on copying and pasting numbers or checking for incorrectly completed returns, while more time is spent on analysing what is behind the financial data submitted by the individual companies,” Freeston continues. “Therefore the finance team can add more value to the monthly Group reporting process.”
The numbers are also more accurate as the central finance team can easily spot anomalies, and Cognos technology allows the team to drill down and find the source of a mistake. This process was very difficult when spreadsheets were used as the consolidation tool. Controller has helped All3Media to achieve a greater degree of flexibility across a wide and demanding range of reporting requirements. One area that has benefited is revenue analysis. Using Controller has enabled the Group to easily collect and review data on the various revenue sources across the organisation, such as production, distribution, and repeat income.
The Cognos solution’s flexibility has also helped All3Media manage the challenge of overseas reporting, as well as the differences between local GAAP (Generally Accepted Accounting Principles) in the various territories across the group. It is possible to report in local GAAP and make a simple adjustment at Group level to bring the accounting into line with All3Media’s accounting policies. Reports can be run to view results under either scenario. The system also gives the central finance team insight into which subsidiaries have reported and which have not and at what stage of the reporting cycle they are at any particular time.
“The central finance team can spend more time analysing how our actual results compare to the original budget or latest re-forecast or prior year, and we are able to react in a more proactive and timely fashion if there appear to be issues at any particular entity.”
“We are a fast-growing, acquisitive company. As a result, our reporting requirements can change from month to month. Cognos Controller provides us with a financial reporting system that is flexible and robust enough to cope with these changes, and supports us in our growth,” Freeston concludes.
About IBM Business Analytics
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