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Speakers Maire Loughran, Author of Close, Consolidate & Report For Dummies Steve Benckenstein, Solution Engineering, IBM

Agenda
• Close, Consolidate, Report - Observations & Options • Maire Loughran, Author of Close, Consolidate & Report For Dummies Book Insights into the Integrated Financial Close Management Process • Steve Benckenstein – Solutions Engineer, IBM IBM Cognos FSR – An Integrated CCR Solution • Steve Benckenstein – Solutions Engineer, IBM

Close. Consolidate. Consolidate & Report For Dummies Book . Report Observations & Options Maire Loughran. Author of Close.

ERP.Current Problems with CCR Activities • Lack of unified platform for managing the financial close management steps – – – – Finance professionals to labour through hundreds of manual and administrative checks Update and checking hundreds of offline spreadsheets Little or no visibility into the status of steps in closing process Waste of time in performing redundant data checks • • • Excessive overtime or missed compliance deadlines Close activities prove to be extremely inefficient and costly Inconsistent data from various subsidiaries – multiple GL. and disparate transactional systems .

Integrating the CCR process • Why companies invest in integrated CCR solutions – – – – – – – To make efficient and effective business decisions Strengthen the companies ability to provide timely and accurate data for better business decisions Obtain financial information in a controlled. auditable process Ensure data integrity and transparency needed to comply with various regulatory requirements Evaluating and limiting the risks of errors Obtain a single platform in order to enhance and monitor internal controls Automate the production of consolidated financials and external compliance reports .

financial consolidation. spreadsheets. OLAP.Advances in Disclosure Management Solutions • Automating the creation of internal and external reports – – Provides a unified financial governance platform Provides a single version of the truth • • • • • Integration to source data – GL’s. etc Integrated XBRL tagging capabilities – tagging is embedded in within the external reporting process Workflow and task management dashboard Enhanced Security – control access to sensitive data Report Consistency – ensure same numbers across separate reports with same data points . ERP.

Why the ‘need’ for Integrated CCR Solution • New disclosure requirements make is imperative to streamline and automate manual tasks in the close. consolidate & report process Companies constantly looking at improving the timing and quality of information in reports Follow best practise to embed compliance and controls into each step of the financial close process The need to maintain data integrity in a secure environment Enhance decision making – flipping back and forth between data sources is inefficient and ineffective • • • • .

regional and global reporting requirements Consolidate diverse ledgers of global units into single currency • Advanced consolidation capabilities – – – – .Ten (…Fifteen) Integrated CCR Solution Features • Central secure environment for all CCR activities – – Ensures data integrity Enhances controls over the CCR process • • Streamline and automate manual closing tasks Audit trail reporting – Automated audit trail from data source through each step until disclosure Intercompany matching and elimination Currency conversion Support for local.

Ten (…Fifteen) Integrated CCR Solution Features • Validation and Business Rules – – Ensure data is correct and up-to-date in every step of the CCR process Data validation in the ‘last mile’ of financial reporting Support for currency conversion methods and translations in detail Corporate finance presents figures in any currently while operating entities work in their own currency.g. Headcount) • Currency conversion and translation – – • • • Source system integration – – Tools to collect non financial data Integrated XBRL tagging capability . Operational and statistical data (e. Integrate multiple structured and unstructured data sources.

bank accounts to reconcile financial transactions and report abnormal deltas • • Ability to generate outputs in multiple formats Integration with Business Intelligence and Business Analytics tools – Help business leaders make better strategic decisions quicker with more confidence Low total cost of training and ownership • • • Familiarity and easy of use – Digital storage of reference documentation Jumpstart the CCR process . sub-ledgers.Ten (…Fifteen) Integrated CCR Solution Features • Automate account reconciliation process – Checking GL. operational systems.

consolidating.com/software/analytics/ . and financial reporting processes Use integration and automation to ensure data integrity and streamline CCR activities Identify the right CCR solution for your organization Download eBook at http://www-01.The Book Learn To • • • Distinguish between the closing.ibm.

IBM . Solutions Engineers.Insights into the Integrated Financial Close Management Process Steve Benckenstein.

Addressing the broader enterprise focused role of finance  A broader enterprise focused role requires core Finance efficiency be in place to reliably support business insight and decision making Demands on Finance Help drive enterprise cost reduction Improve access to and reduce cost of capital Support risk management Provide performance insight and anticipate Partner in strategy and value creation Business Insight Finance Capabilities Needed Finance Efficiency Source: IBM Institute for Business Value. The Global CFO Study 2010 .

annual reports First Mile Data quality and control system for collection and reconciliation Consolidation Financial consolidation and systems for processing and preparation Last Mile Leveraging financial data trapped in the close process for reporting Certifying and publishing external documents Closing Process (Accounting Processes) • Close Sub Ledgers and Systems • Account Reconciliation • Intercompany transactions • Prepare journal entries: accruals & adjustments • Financial reporting Reporting (Reporting Systems) • BI reporting systems Compliance & Control . • Management adjustments • Allocations • Advanced formula calculations Internal controls & compliance testing REPORT Last Mile Reporting (Consolidation System) Internal Reporting • Financial reporting adjustments • Cash flow & other preparation External Reporting • Financial statement preparation • Publish quarterly.The Close. Report Process CLOSE First Mile Closing Process (Consolidation System) • Data Input & Changes • Collect From Subsidiaries CONSOLIDATE Consolidation Consolidation (Consolidation System) • Create single currencies • Minority interest holdings • Intercompany eliminations • Group closing adj. Consolidate.

Risks of Manual MS-Office Reporting A closer look at the current reporting process.  Editing... updating. and review of reports done in multiple versions of offline Excel spreadsheets. Word docs and PowerPoint slides – MS Office tools not integrated into processes which leads to little visibility or auditability of data within – Version control is a nightmare – Pieces of data and analysis need to be shared across multiple reports for different audiences Reviewers Contributors – Not everyone has access to same files  High risk of errors – Report data not integrated with source data – Requires multiple manual updates of financial or operational data in tables and narrative commentary Approvers Document Managers – Requires time-consuming checks to ensure data in up-to-date and to ensure integrity of data throughout the report(s)  And little security – Primary collaboration tool is unsecured email – No central. audit trail or security over using MS Office & email – Confidential information can be easily leaked Report Consumers 15 . collaborative solution for preparing reports – No controls.

Financial Close Process has a High Degree of Risk Performance Reporting and Scorecarding Business Drivers Close. Consolidate. Forecast. and Report Analyze & Optimize Plan. and Control Risk of Errors Feature Integration to source data Variables in text Validation Rules Benefit No re-keying of data Consistency across the report Numbers always tie-out Risk of Late Filing Feature User prior report as a template for the next period Automatically load new data Benefit No need to re-apply formatting No need to re-key data One version of the truth Feature Security to view or edit each object Workflow controls access throughout the process Benefit Users only see the data they are supposed to see Users only see data when they are allowed to see it Feature Start reviewing the final report sooner Benefit To ensure that the right steps are being followed To track who did what. and when they did it Compliance Checklists Audit Trail Access to information is controlled Increased confidence in the final report Risk of Insider Leaks Risk of Non-Compliance .

The Last Mile The Last Mile Planning Modeling Budgeting Forecasting Consolidation Reporting Monthly Reports. Quarterly Reports. Internal Reports. Excel and e-mails back and forth – Non-existent or minimal internal controls – No detailed audit trail of activities and user modifications – Many opportunities for data accuracy issues – Limited flexibility Manual Processes Repeated Each Period 17 . Annual Reports. Flash Reports • Manual processes dominates “The Last Mile” – Bottlenecks in document creation – Collaboration is tedious – Copy and paste exercises with Word.

IBM .IBM Cognos FSR – An Integrated CCR Solution Steve Benckenstein – Solutions Engineer.

not an after-thought – Automated Roll-Forward of XBRL Tags for subsequent periods 19 .IBM Cognos FSR – What it is Key features: – Leverage the formatting capabilities of MS-Word & Excel as well as the calculation features of MS-Excel – Dynamically driven from a central database – Controlled access with full audit trail – Workflow for report reviews and approvals – Integrated XBRL tagging is part of the process.

True Integrated Financial Governance SOURCE SYSTEMS REAL TIME Excel Reports Output Requirements REAL TIME TRICKLE COGNOS Close Reports TM1 Explorer EDGAR-ready Financial Reports Go Office DIRECT TO FSR .

IBM Cognos Controller IBM Cognos Controller  Built-in Financial Intelligence  Deep Consolidation Functions  Multi Jurisdictional GAAP Reporting  Familiar Web & Excel User Interface  Consolidation Workflow  260+ Working Reports – Out of the Box IBM Cognos Controller Extend with:  Application Configuration Approach  Financed Owned  Rapid Time to Value IBM Cognos TM1 IBM Cognos BI Performance Blueprints .

budgeting and broader reporting Low Implementation Risk • • FINANCE DRIVEN solution for rapid implementation NO CODING system design = low risk approach to system success . analysis.Cognos Controller Finance Consolidation Intelligence • • • PURPOSE BUILT directly into the solution and user interface Allows organizations to leverage CONSOLIDATION BEST PRACTICES Secure auditable closing Single Application Approach .Adaptability and Flexibility • RICH APPLICATION FUNCTIONALITY out of the box – • • Multiple Roll Ups (hierarchies) – Data from disparate sources ADAPTABLE to changing business conditions and external requirements OWNED BY FINANCE – low dependence on external consultants or IT = low total cost of ownership Reporting. budgeting and information delivery • • • ON DEMAND REPORTS for understanding and certifying company consolidations BUILT-IN. standard financial and management performance reporting LEVERAGE Cognos BI & Planning tools for analysis.

Consolidate.) • CSR Reports 23 Regulatory Reporting • Reporting to Federal. and Control • • • • Press Releases Annual Report Prospectus News Wire Releases • Board Books • Flash Reporting Investor Relations Internal Reporting • Management Reporting • Notes & Exhibits to Statutory Filings • Proxy Statements Legal • Statutory Reporting • SEC Filings (10K. etc. State and local agencies 23 Integrated Financial Governance Solution . Forecast. 10Q. and Report Analyze & Optimize Plan.Sharing Information Across the Organization Performance Reporting and Scorecarding Business Drivers Close.

Extending the Value of FSR Beyond External Reporting • Internal Reporting. including: – Flash Reports – Board Books – Budget Books – Other Internal Reporting Packages • CEO/CFO Certification Process • GAAP to IFRS Conversion • Corporate Social Responsibility (CSR) Reporting • Enterprise Risk Management • Reconciliation Management .

MS Word and more Data Warehouse .Automate Manual Internal Reporting with Cognos FSR A unified governance platform for automating internal management reporting processes  Integrate with any data source to ensure a single source of the truth Document Managers  Use web templates to automate data collection from anywhere in the world  Variables in text provide real time data updates within reports Reviewers IBM Cognos FSR Contributors  Enhance controls and security with audit trail reporting and embedded approval checklists  Workflow and task management tools provide greater visibility into every step of the process Report Consumers Approvers  Create/update content once and automatically update that content across multiple reports  Multi-author environment allows for collaboration in creating content-rich reports Consolidations ERP Excel OLAP Web  User friendly and familiar interface of MS Office  Business rules and embedded validation greatly reduce risk of errors  Generate reports in multiple formats including PDF & Powerpoint.

Questions .