How to succeed in your consolidation and reporting unification project?

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Before engaging in a unification project, it is crucial to think about the following question: which level of unification do you want to achieve? In fact, every entity needs to determine the level of unification that suits their needs. On that basis, different types of projects can be determined:

  • A harmonization project only consists of reconciling the process and the frame of reference to facilitate the reconciliation tasks.
  • A convergence project will consist of building the management reporting in a common tool and following a shared frame of reference, however keeping the different processes led by two different teams.
  • A complete unification project will have as goal the implementation of a tool and of one unique frame of reference with a unified team who will lead the processes of statutory consolidation and management reporting.

The first steps of the project will determine the target group, keeping in mind that a unified reporting offers clear advantages in terms of quality and of data coherence, but also limits the flexibility and capacity to evolve with the needs. Moreover, in the case of a complete unification, both teams (consolidation and management reporting) should make certain concessions.

6 good practices that should help you succeed in this project:

1. The first step in unifying the two processes is to reconsider the ensemble of needs and actual practices of reporting to build a blueprint based on the imbrication of models. For example, to review the forecasting reporting cycle to better align with the actual information.

2. It is crucial to build a common frame of reference, which responds to the needs of both consolidation and reporting. For example, a unique chart of accounts, common elimination rules and coherent perimeter settings.

3. Also, the processes should be converged to the ensemble of the chain: from collecting to producing the common reports.

4. Think about your organization, because it will certainly be impacted. Until which point do you want to unify? What will be the impact for the entities?

5. Implementing an IT architecture and evolutive systems adjusted to your needs:

  • Think about the link between the consolidation tool and the decision-making tool.
  • Pay attention to the choice of the consolidation and reporting tool: not every software has been created to offer 2 sets of functionalities. There are consolidation tools on the market that have been completed afterwards with reporting functionalities, and vice versa.
  • Considering the volume and performance aspects.

6. Involve the management team, so that they can make the necessary decisions. The fact of wanting to unify consolidation and reporting implies structural choices and also the local management plays a crucial role in clarifying the responsibilities when presenting the unified information.

The above points show how this project is of strategic nature. Relying on external advice is most of the time essential. Making a good choice regarding the software provider is also a big advantage, and the criteria that should help you in making the right choice are: experience in the domain, mixed experience in the team, proven methodology in the closing process, thorough knowledge of information systems, …

Contributor: Benjamin Steadman, Senior Manager, CFO Services, Deloitte Conseil