To set a little context I’ll briefly walk through a sample consolidation and reporting process. See if any of this sounds familiar.
Simplified Global Consolidation Process
Imagine we’re dealing with a North American-based organization in Milwaukee, Wisconsin that has subsidiaries and international operations throughout the world. The consolidation process starts with this corporation’s subsidiaries and country-specific operations consolidating their data and producing financials for their own legal entity relationships for their local reporting and local ownership and tax purposes. These same entities capture their ‘local’ data in their ‘home’ currency through their own general ledger systems and/or receive data from manual inputs and manual processes via tools like spreadsheets. At this point the subsidiaries and countries will prepare trial data submissions in local currency which will then be fed to the corporate finance department in Milwaukee. Typically, files are securely sent to corporate as uploaded to a common repository for corporate handling. Usually, there’s a lot of back-and-forth communications with these entities and corporate while they’re preparing their data.
Corporate finance receives these data submissions from all of the subsidiaries, country operations, and/or legal entities and consolidates this information into a common reporting currency; in this case, US Dollars. From there, corporate finance will perform additional consolidation activities including inter-company eliminations, group adjustments, such as investment eliminations between subsidiaries, and, ultimately, they will perform the final financial consolidation. Once these activities are completed they will then go through the process of analyzing the financial results and circle back with different participants in the consolidation, i.e. subsidiaries, legal entities, regions, etc. and relevant stakeholders in the process where variances are to be explained. Comparative reporting is then done across periods (last year vs. this year) or against plans (budget vs. actual) or even against budget foreign exchange rates to take out any f/x anomalies which might skew the data. These results are then fed into the management reporting and corporate planning process where the real analytics and decision making ultimately takes place. Then, for financial governance, statutory financial results need to be prepared and signed off for external reporting for investors, analysts, and regulatory agencies.
Phew…and that was a VERY simplified version of this process. Believe me, there’s a lot more to this process.
AUTOMATE WITH EMBEDDED CONTROLS THROUGHOUT: ENTER IBM COGNOS CONTROLLER!
Cognos Controller is a comprehensive, Web-based solution that offers power and flexibility for streamlined, best-practice financial consolidation and reporting – all in one solution. Its full suite of capabilities delivers a complete portfolio of financial results and provides an integrated platform for financial and management reporting. Cognos Controller makes it easy to deliver financial statements and reports to finance stakeholders, as well as managers, line-of-business executives and regulatory bodies. It also provides the de facto starting point for planning, budgeting and other performance management processes.
Just a few reasons why IBM Cognos Controller 10.1:
- Accelerates the close process;
- Automates financial consolidation processes and accounting
- Prepares and seamlessly delivers financial statements, financial reporting and analysis
- Consolidates financial information in a centralized, controlled and compliant environment
- Delivers a complete range of local and global consolidation and reporting requirements “out of the box” – integrated into an application framework
- Provides capabilities include data collection, validation, currency conversion, minority interest calculations, inter-company eliminations, group closing adjustments, management adjustments, allocations, advanced formula calculations and compliance testing.
- Provides support for consolidated financial reporting for all local jurisdictions and multilingual reporting;
- Flexible processing of modifications to corporate and account structures and group histories
- Integrated scenario manager for simulation and modeling
- Prepares all financial statements and in-process closing reports for either validation or reconciliation;
- Includes ability to configure, track and audit data flow within the consolidation process
- Enables omplete self-service application, finance owned & managed solution
- Supports IFRS, FASB, Basel II and Sarbanes-Oxley requirements and can handle any GAAP or regulatory environment;
- Low total cost of ownership
- Real-time analysis, modeling, forecasting with drill-thru to transactional detail
- 200+ standard out-of-the-box reports built into the solution
- Both quantitative and qualitative data can be entered automatically or manually
- Easy to create and manage individual data entry forms and templates
- Flexible to adapt and extend to custom requirements and multiple structures/dimensions/business rules
- Enables attaching documents to reported figures with text notes and reporting manuals
- Scalable to meet large user and data volumes
- Global list of empowered customer champions
- Built in integration with IBM’s performance management solutions, including IBM Cognos TM1 for extended analytical reporting and business planning for further viewing of financial and operational results, comparative plans, and extended Financial/Management reporting;
- Real-time link to your consolidation with IBM Cognos Business Intelligence dashboards and other production reporting tools you might use in our overall product suite;
- Offers a choice of interfaces. The familiar Web browser or Microsoft® Excel® both give users secure, ready access to data. Full Microsoft Excel functionality streamlines financial data input and formatting.
- Compatible with MS SQL Server, DB2 or Oracle databases;
- Up to date with latest MS Windows and Office releases;
- Supports global deployments through support of most popular languages in Europe, Asia, North America and Latin America;
…and these are just some of the features of IBM Cognos Controller 10.1!!!!
Value Thru Cross-Enterprise Adoption
For external financial statement production & XBRL, IBM Cognos Controller data and reports are directly available within external financial documents developed in our IBM Cognos Clarity Financial Statement Reporting (FSR) solution.
IBM Cognos FSR is the market leading solution to control, automate and audit the “last mile” of finance, the challenging collaborative collection and assessment of data from multiple sources that must be brought together into important external documents such as 10Q, 10K or annual reports, or highly confidential documents such as board books. IBM Cognos FSR documents can access IBM Cognos Controller data and text directly, enable collaborative approval, and embed the financial information into any report. The connection is permanent, providing for automatic updates as required, including new versions of the document in future years.
To learn more about IBM Cognos Controller 10.1 here are some additional info for your reference:
IBM Cognos Controller Web Page
IBM Cognos Controller Demo
IBM Cognos Controller White Paper
Related White Papers & Best Practices
Financial Consolidation and Reporting is part of a larger end-to-end process fully-enabled by our IBM Financial Performance Management solutions. In the illustration below you can see how our solutions work together to solve this larger process we call, “Close, Consolidate, Report & File”.
- IBM solutions seamlessly integrated can automate all of these critical Close, Consolidate, Report & File Activities
For more information on this or other Business Analytics topics, feel free to contact me at your convenience.
Blog @ http://provenpractices.wordpress.com