Ventana Research Analyst Perspectives

Financial Performance Management Software Vendors Face Challenges

Posted by Robert Kugel on Jan 13, 2017 12:05:24 AM

Ventana Research defines financial performance management (FPM) as the process of addressing often overlapping issues involving people, process, information and technology that affect how well finance organizations operate and support the activities of the rest of their organization. FPM software supports and automates the full cycle of finance department activities, which include planning and budgeting, analysis, assessment and review, closing and consolidation, internal financial reporting and external financial reporting, as well as the underlying information technology systems that support them.

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Topics: Performance Management, ERP, FP&A, Consolidation, reconciliations, reporting, Accounting, Financial Performance Management, FPM

Ditch Presentations to Improve Corporate Governance

Posted by Robert Kugel on Nov 2, 2016 1:03:00 AM

The topic of corporate governance received renewed attention recently after the publication of an open letter signed by 13 prominent business leaders, including Warren Buffett of Berkshire Hathaway and Jamie Dimon of JPMorgan Chase. The first principle the group advocated in the letter is the need for a truly independent board of directors. To achieve that aim, the letter suggests having the board meet regularly without the CEO and that the members of the board should have “active and direct engagement with executives below the CEO level.” From my perspective, translating this idea into reality would be helped by a change in the dynamics of most board meetings. I would eliminate the standard presentation of results and begin the meeting with questions and observations from the board members directed to company executives related to its financial and operating results and any other matters on the agenda. This could take place with or without the CEO.

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Topics: Mobile, Governance, Consolidation, Reconciliation, reporting, Accounting, CFO, CEO, board of directors, accounting close

ERP and Financial Performance Management Begin to Overlap

Posted by Robert Kugel on Dec 20, 2015 7:52:30 PM

The ERP market is set to undergo a significant transformation over the next five years. At the heart of this transformation is the decade-long evolution of a set of technologies that are enabling a major shift in the design of ERP systems – the most significant change since the introduction of client/server systems in the 1990s. Some ERP software vendors increasingly are utilizing in-memory computing, mobility, in-context collaboration and user interface design to differentiate their applications from rivals and potentially accelerate replacement of existing systems (as I noted in an earlier analyst perspective). ERP vendors with software-as-a-service (SaaS) subscription offerings are investing to make their software suitable for a broader variety of users in multitenant clouds. And some vendors will be able to develop lower-cost business systems to broaden the appeal of single-tenant hosted cloud deployments for companies that cannot adapt their businesses to share with other tenants or prefer not to.

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Topics: Performance Management, ERP, FP&A, Human Capital, Reporting, Consolidation, Reconciliation, Analytics, Business Analytics, Business Performance, Financial Performance, Uncategorized, Accounting, Financial Performance Management, FPM

Tagetik Advances Disclosure Management for Office of Finance

Posted by Robert Kugel on Jul 16, 2014 9:06:01 AM

Tagetik provides financial performance management software. One particularly useful aspect of its suite is the Collaborative Disclosure Management (CDM). CDM addresses an important need in finance departments, which routinely generate highly formatted documents that combine words and numbers. Often these documents are assembled by contributors outside of the finance department; human resources, facilities, legal and corporate groups are the most common. The data used in these reports almost always come from multiple sources – not just enterprise systems such as ERP and financial consolidation software but also individual spreadsheets and databases that collect and store nonfinancial data (such as information about leased facilities, executive compensation, fixed assets, acquisitions and corporate actions). Until recently, these reports were almost always cobbled together manually – a painstaking process made even more time-consuming by the need to double-check the documents for accuracy and consistency. The adoption of a more automated approach was driven by the requirement imposed several years ago by United States Securities and Exchange Commission (SEC) that companies tag their required periodic disclosure filings using eXtensible Business Reporting Language (XBRL), which I have written about. This mandate created a tipping point in the workload, making the manual approach infeasible for a large number of companies and motivating them to adopt tools to automate the process. Although disclosure filings were the initial impetus to acquire collaborative disclosure management software, companies have found it useful for generating a range of formatted periodic reports that combine text and data, including board books (internal documents for senior executives and members of the board of directors), highly formatted periodic internal reports and filings with nonfinancial regulators or lien holders.

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Topics: Mobile, ERP, forecasting, Modeling, Reporting, Budgeting, close, closing, Consolidation, Controller, Finance Financial Applications Financial Close, IFRS, multinational Tagetik, process management, report, strategy, XBRL, Analytics, Business Analytics, Business Intelligence, Business Performance, Financial Performance, Governance, Risk & Compliance (GRC), Accounting, CFO, Chief Financial Officer, compliance, Data, benchmark, Financial Performance Management, financial reporting, FPM, GAAP, Integrated Business Planning, Profitability, SEC Software, spreadsheet

The Virtues of Automating Reconciliation

Posted by Robert Kugel on Mar 29, 2014 8:41:19 AM

Reconciling accounts at the end of a period is one of those mundane finance department tasks that are ripe for automation. Reconciliation is the process of comparing account data (at the balance or item level) that exists either in two accounting systems or in an accounting system and somewhere else (such as in a spreadsheet or on paper). The purpose of the reconciling process is to identify things that don’t match (as they must in double-entry bookkeeping systems) and then assess the nature and causes of the variances. This is followed by making adjustments or corrections to ensure that the information in a company’s books is accurate. Most of the time, reconciliation is a matter of good housekeeping. The process identifies errors and omissions in the accounting process, including invalid journal postings and duplicate accounting entries, so they can be corrected. Reconciliation also is an important line of defense against fraud, since inconsistencies may be a sign of such activity.

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Topics: automation, close, closing, Consolidation, Controller, effectiveness, process management, reconcile, Reconciliation, report, XBRL, Business Performance, Financial Performance, Governance, Risk & Compliance (GRC), Accounting, CFO, Data, Document Management, Financial Performance Management, FPM