Ten things smart finance professionals demand of their Consolidation system

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10 things smart finance professional demand of their consolidation system

Ten things smart finance professionals demand of their Consolidation system

Leading Finance Professionals agree, having a robust and lean Financial Close and Consolidation process has a huge, positive impact on the finance team’s ability to deliver actionable insight to the business. In this article we delve into some ‘must-have’ features that are essential to a modern Close and Consolidation system.

First, let’s recap on the current landscape.

Financial Close and Consolidation refers to the process businesses use to collect and combine financial, statutory and management data in one place to create a structured, consistent and ‘single view’ reporting process. For further detail on this process, read our Guide to Financial Close & Consolidation. With some finance teams reviewing their use of complex excel sheets, and others implementing stand-alone software to handle parts of the process, many are at different stages of ‘Digital Finance Transformation’.

“But we are not doing any ‘Digital Finance Transformation’ at our company…” we hear you say.

Well, you might not think you are, but unless you have been living under a rock for the last ten years you will have noticed, and pretty much have been affected (either in your business or personal life) by the fast pace of change in the world around us. It is happening, so you either need to jump on board the digital train, or risk being left behind, watching the world and your competitors pass you by, at pace.

Wherever you are in your journey, you (should be) aware of the need for change. Smart Finance professionals are going one step further and taking a step back. By ‘taking a step back’ it presents you with a bird’s eye view of the entire business data landscape. This strategic view enables the CFO, BI and other senior finance and data custodians to pave the way to a future which is both about empowerment, growth and future-proofing the business.

Wherever you are on your Financial Digital Transformation, rest assured: with the right technology in place, and the right guidance for a smooth implementation, the formulaic and repetitive tasks associated with Financial Close & Consolidation can be automated, reducing errors, accelerating the close cycle, and freeing your teams to spend their time on more valuable activities that drive real growth. Here are ten features that we think all smart Finance Professionals should be looking for.

Ten features you need in your Financial Close & Consolidation software

  1. Intercompany reconciliation

    Look out for systems which have an intelligent dashboard. This allows you to get an ‘at-a-glance’ view of intercompany relationships and their impact on consolidated financials.

    Why is this useful?
    Intercompany cockpits / dashboards can save your team from the need to flick between screens to find the information they need, saving time and increasing accuracy. What’s more, they allow you to see how the various parts of your business relate to each other and spot opportunities or anomalies as soon as they appear.

  2. Multi-currency capability

    Make sure that your system has in-built functionality that enables you to work across multiple currencies.

    Why is this useful?
    Multi-currency functionality makes it easy to quickly convert currencies from business units in different countries and translate them to the parent company’s presentation currency for reporting purposes. Even if your business only operates in one country at the moment, it’s well worth having this feature in place, to future proof your activities as you grow.

  3. Data validation tools

    An automatic data validation feature will create alerts or halt progress when it sees data that falls outside of a pre-specified threshold.

    Why is this useful?
    Data validation tools use notifications to draw attention to possible anomalies so that they can be further investigated. They can even be configured to prevent end-users from saving changes if you wish. This can significantly reduce errors and time wasted on rectifying problems down the line.

  4. Ownership register

    The ownership register contains not only the information about the parent entity – child entity relationship, but also contains financial information about who owns who, the ownership percentage and details such as the carrying value

    Why is this useful?
    This feature automates the investment elimination journals on consolidation and provides auditors with a clear system generated report.

  5. System integration

    A powerful ETL (Extraction, Transformation & Loading) engine will accurately combine data from multiple sources and allow you to configure it to suit your needs.

    Why is this useful?
    This feature extracts data from disparate external sources, such as Excel files, text files, data warehouse, ERP systems, or databases, allowing users to see and work with the data in one place. This automation saves time and significantly reduces the risk of error.

  6. Management and statutory reporting tools

    Make sure that your Close and Consolidation system offers a good Management and Statutory reporting tool on a unified platform.

    Why is this useful?
    This feature is crucial to ensuring your business has access to ‘one version of the truth’ to break down silos, build confidence, inform critical business insights and drive decision making.

  7. System reports for auditors

    A good Close and Consolidation system will include functionality to help build reports including journal reports, interco reports and FX analysis.

    Why is this useful?
    This features will take much of the leg work out of reporting, driving consistency, reducing stress around audits, and freeing your team up to work on other more value-driving activities.

  8. Handle complex consolidations

    A robust consolidation tool will allow your team to consolidate across multiple business levels, taking care of any complexities that may exist within the group.

    Why is this useful?
    With a robust consolidation tool in place your team will be able to consolidate data quickly and accurately, even when dealing with complex group structures.

  9. Using categories to enter adjustments

    Category tools enable users to group data accurately.

    Why is this useful?
    Category tools give users the ability to and manage data within the application and interrogate it with ease.

  10. Overview of progress

    A defined process workflow with the ability to track where entities are in the process is crucial. With the ability to set deadline dates and set email reminders to relevant members of teams.

    Why is this useful?
    This allows you to identify areas of the process which are taking longer than expected, also provides a control allowing monitoring of the overall close and consolidation process.
What’s next?

Whatever stage of the journey you’re at, why not do one of the following;

CONTACT US for an informal chat
JOIN/WATCH Making Complex Consolidation Simple [Webinar]
DEMO CCH Tagetik | DEMO of IBM | DEMO of LucaNet

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