The Financial Consolidation process is all about the collection of financial results from the different business units, divisions, countries and legal entities of an organisation, and adding them up such that all proper accounting conventions and rules are satisfied, including (not an exhaustive list!):
All these topics require repeated, standardised, auditable adjustment following the initial challenges of collecting and manipulating (mapping) the data into a standard format from all submitters.
It is easy to fall into the trap of thinking of Financial Consolidation as just a challenge for 'group', for those at 'head office', and as just a problem for Statutory Reporting.
However, most of the topics listed above are equally relevant to Management Reporting to a greater or lesser extent. In almost all organisations, what is described as the 'statutory reporting' consolidation system is, in reality, also used as the tool for collating the information that forms the basis of internal reporting to the group board; in other words, Group Management Reporting. This is, however, in our view rarely recognised adequately at the design stage of a consolidation system, so leading to compromises and long-term operational challenges that could and should have been identified and resolved early.
We have experience of designing and implementing Financial Consolidation systems, such as Oracle Hyperion HFM, that fulfil Statutory and Group Management reporting requirements.
If it sounds like we're speaking your language, Please contact Nigel Dahl through LinkedIn using the button below, or call him now on +44 (0)7799 664165.
Managing Director of epmgurus, brings 30 years of diverse experience to bear in helping organisations and teams through change – of size, structure, systems, management or ownership.
Nigel has run, advised, supported or worked with Finance functions from one-person operations up to globally dispersed Finance departments of several thousand people. He knows what good (and bad!) looks like.
Enterprise Performance Management (EPM) is a broad term covering any business process that seeks to improve performance through a continuous loop of data collection, reporting, analysis and, most importantly, informed and targeted action.
In practice, Finance EPM is generally considered to cover at least Strategic, Financial and Operational Planning, Budgeting and Forecasting, Management Reporting (MI), Financial Consolidation, Statutory Reporting, Profitability and Cost Management, including Cost Allocation.