automating key accountancy processes

54
Ann Furlong BlackLine Stephanie Hudson SAP Stoyan Arnaudov CNH Industrial Magnesh Singh CNH Industrial ARE YOUR ACCOUNT RECONCILIATIONS IN GOOD SHAPE? See How CNH Industrial Improves Finance Controls And Automates Key Accountancy Processes Using the BlackLine Financial Close Suite for SAP® Solutions 26 November 2014

Upload: blackline

Post on 04-Jul-2015

426 views

Category:

Software


1 download

DESCRIPTION

How confident are you in your financial close and the accuracy of your financial statements? Are you tired of wasting time doing reconciliations manually, using spreadsheets? Would you like to increase efficiency, productivity, control and visibility while minimising risks and reducing bottom line costs? If so, join SAP, BlackLine and global manufacturing/agricultural giant CNH Industrial for a webinar that will show SAP customers (operating in an SAP-only environment or across multiple ERPs) and other ERP users how to optimise key accountancy and finance processes.

TRANSCRIPT

Page 1: Automating Key Accountancy Processes

Ann Furlong BlackLine Stephanie Hudson SAP Stoyan Arnaudov CNH Industrial Magnesh Singh CNH Industrial

ARE YOUR ACCOUNT RECONCILIATIONS IN GOOD SHAPE? See How CNH Industrial Improves Finance Controls And Automates Key Accountancy Processes Using the BlackLine Financial Close Suite for SAP® Solutions

26 November 2014

Page 2: Automating Key Accountancy Processes

Ann Furlong Director of Operations, APAC BlackLine

Page 3: Automating Key Accountancy Processes

WHAT IS AN ACCOUNT RECONCILIATION?

• Substantiation of the General Ledger account balance by comparison to the real world substance for that account- e.g. Bank Balances, Inventory subledger balance, Payables subledger balance

Page 4: Automating Key Accountancy Processes

WHY DO WE NEED TO RECONCILE ACCOUNTS? • Financial Reporting Accuracy

– Financial Reports must present the financial status of the company in a timely and accurate manner in accordance with the required accounting methodology

– The General Ledger balance is the source for all financial reporting to regulatory organizations, stockholders, banks

– Reconciliations reveal mistakes in the account balances by comparing them to the real world substance for the account

• Invalid journal postings, Duplicate entries, Missed entries • Fiduciary Responsibility

– To identify potential fraud before it’s too late • A Quality Reconciliation substantiates an account balance rather

than repeating the activity in the General Ledger

Page 5: Automating Key Accountancy Processes

LET’S LOOK AT A SAMPLE RECONCILIATION: The rec is complete and there is no variance

Page 6: Automating Key Accountancy Processes

LET’S TAKE A LOOK AT A RECONCILIATION: What is wrong with this reconciliation?

Page 7: Automating Key Accountancy Processes

The Utopian Close Stephanie Hudson Finance Program Manager, Australia & New Zealand SAP

Page 8: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 7

The Reality of the New Normal for Finance Professionals

Increasing globalization

Increased focus on risk

Volatility in economic conditions

Ability to Make Sound Decisions

to Benefit the Organization

Pressure on margins

Innovative business models On-going

changes to regulatory requirements

Major influence on the Financial Close

Page 9: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 8

Analyze Execute

Achieve real-time insight into the progress, quality and

financial results of the financial close process on

any device, for better business decisions and faster issue resolution

Increase the efficiency of your financial “close to disclose”

process through automation, integration, faster processes,

better collaboration, and intuitive self-service access to financial

information

Control

Ensure the quality and governance of the financial close through templates,

workflow, and an end-to-end management of the entire close

to meet regulatory disclosure mandates

Accounting and Financial Close Need for improved speed, compliance, and insight while reducing costs

Page 10: Automating Key Accountancy Processes

© 2013 SAP AG. All rights reserved. 9

The Utopian Close: Creating a low risk highly effective financial close.

Source: Deloitte – The Utopian Close – M h 2013

16%

27%

19.50%

11%

26.40%

My people are motivated and put talents to the best use

We have a process that is clearly defined, managed andefficient.We have clear accountability and ownership.

Technology allows the accountants to do more thinkingandless busy work.

Tale

nt

Proc

ess

Ow

ners

hip

Tech

nolo

gy U

topi

a

Sample 1458

Maturity

20.70%

10.50%

5.90%

43.20%

19.70%

Vast volumes of data coming from different sources

Dispersed accounting teams with lack of visibility andaccountabilityInconsistent application of accounting policies andproceduresManual tasks consume our time

Volu

me

Acc

ount

ing

team

s

Polic

ies

Man

ual T

asks

Tech

nolo

gy

Sample 1559

Challenges

Page 11: Automating Key Accountancy Processes

Accounting and financial close Improve speed, accuracy, and compliance while reducing costs

Sub Ledger Reporting and Analysis

Consolidation

Entity Close Management

Intercompany Reconciliation

Notes Management Disclosure

Management

Starter Kits

Process Control

Master Data Governance For Finance

General Ledger

Financial Accounting

Entity Close

Corporate Close

Reporting Disclosure

Account Reconciliation

Page 12: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 11

Analyze: Insight for better decisions Easily access large data volumes for better decisions Solve issues faster by real-time insight into close progress Proactively simulate implications of financial events

Execute: Speed and efficiency Reduce closing cycle time to produce financial statements Drive efficiency through automation and standardization Provide self-service financial information to stakeholders

Control: Compliance and transparency Ensure compliance to global & local reporting standards Produce accurate reports & filings with detailed audit trails Centrally govern the close to disclose cycle

SAP Accounting and Financial Close

Page 13: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 12

Corporate Close Benefits

44% Lower audit cost as a percentage of revenue, in companies that streamline and automate compliance processes Source: SAP Performance Benchmarking

Streamlined Financial Consolidation and Reporting Process

Instill stakeholder confidence by supporting multiple currencies and reporting standards

Save time and money, providing one version of truth

Trace back to the source of information, making the data more reliable and ensure individuals are accountable for their information

Make more informed decisions

Page 14: Automating Key Accountancy Processes

Accounting and financial close Improve speed, accuracy, and compliance while reducing costs

Sub Ledger Reporting and Analysis

Consolidation

Entity Close Management

Intercompany Reconciliation

Notes Management Disclosure

Management

Starter Kits

Process Control

Master Data Governance For Finance

General Ledger

Financial Accounting

Entity Close

Corporate Close

Reporting Disclosure

Account Reconciliation

Page 15: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 14

Account Reconciliation Requirements

CFOs / CEOs need to attest the correctness of the financial statements and internal control systems of their entities and corporate group.

The purpose of reconciliation management is to provide reasonable assurance as to the accuracy of financial data at a specific point in time.

The focus of account reconciliation is on the correctness of account balances because they directly roll-up into the financial statements.

It is the process of comparing account data (on balance or item level) that exist in two systems or locations (outside of systems, e.g. on paper), analyzing variances, and making required corrections, so that the information is accurate.

There is a significant qualitative nature of Account Reconciliation. The assessments have to be documented by relevant calculations, clear and complete explanations, and copies of supporting documents in compliance with company policy.

The process and results of reconciliations must be easy to track and verify, and may be checked and signed-off by auditors.

Often, the requirement is also named Balance Sheet Reconciliation.

Page 16: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 15

Reconciliation Functionality in SAP ERP

Financial Accounting

Fixed Assets

Accounts Payable

Accounts Receivable Leverage your

SAP ERP system

Page 17: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 16

Reconciliation Functionality in SAP ERP – Example

however, just running such reports is not sufficient ...

Page 18: Automating Key Accountancy Processes

© 2014 SAP AG or an SAP affiliate company. All rights reserved. 17

SAP Financial Closing Cockpit

If you already use SAP Financial Closing cockpit for Entity Close, leverage it also for executing reconciliation functionality in ERP and for documenting its results ... still you need more ...

Page 19: Automating Key Accountancy Processes

Ann Furlong Director of Operations, APAC BlackLine

Page 20: Automating Key Accountancy Processes

ABOUT US • Global headquarters in Los Angeles with regional main offices in

Sydney and London

• Leader in Enhanced Finance Controls & Automation Software category

• Nearly 1,000 clients (many in the Fortune 500/Global 1000) • Over 100,000 users worldwide in 100+ countries • First to market and offer software to automate the entire financial

close process

• BlackLine Certified Implementation Professionals all around the world

Page 21: Automating Key Accountancy Processes

GLOBAL DEPLOYMENT

BlackLine OnDemand users (100+ COUNTRIES)

BlackLine Offices

BlackLine Certified Partners

Page 22: Automating Key Accountancy Processes

• The BlackLine Financial Close Suite for SAP® Solutions is an SAP-endorsed business solution and is the only financial close solution to achieve this

• Solutions endorsed by SAP are complementary to SAP software offerings, have been specifically integrated with SAP solutions and tested by SAP

• BlackLine’s SAP Connector seamlessly integrates BlackLine to SAP Financials

SAP PARTNERSHIP

Page 24: Automating Key Accountancy Processes
Page 25: Automating Key Accountancy Processes
Page 26: Automating Key Accountancy Processes

My biggest challenge around the closing process is: a) Lack of visibility b) Little/no standardisation of reconciliations c) Too many manual processes d) Unclear ownership of tasks e) Other

Page 27: Automating Key Accountancy Processes

EFFICIENCY, SPEED & VISIBILITY REDUCED COSTS AND RISKS CONTROLLED FINANCIAL CLOSE

BLACKLINE PROVIDES

Page 28: Automating Key Accountancy Processes

POLICIES AND PROCEDURES

WORLD-CLASS PROCESS

STANDARDISATION

AVAILABILITY TRAINING

CONTROL

Page 29: Automating Key Accountancy Processes

BLACKLINE PROCESS

Page 30: Automating Key Accountancy Processes

• REAL-TIME MONITORING AND REPORTING • CONTROLLED PROCESS • DATA INTEGRITY & INTEGRATION • SIMPLE, SECURE SaaS SOLUTION

BLACKLINE FINANCIAL CLOSE SUITE FOR SAP® SOLUTIONS

Page 31: Automating Key Accountancy Processes

How are you currently handling account reconciliations? a) BlackLine b) Excel c) Other third-party software d) Internally developed tool/system e) Doing manually

Page 32: Automating Key Accountancy Processes

ACCOUNT RECONCILIATION: BLACKLINE HIGHLIGHTS & BENEFITS • Used for entire balance sheet (pre-paids, accruals, bank, sub-

ledger, debt, equity, etc.) • Auto-certification of low risk reconciliations • Templates-based process for standardisation and quality • Supporting documents – can be saved/accessed from

within the system • Approval workflow – multiple levels with flexible scheduling • Automated e-mail alerts for proactive notification/monitoring • Reporting for real-time status updates • Centralised, global access – anywhere, anytime • Multi-currency AND multi-language (available in 15 languages!) • Easy integration with existing ERP, GL systems

Page 33: Automating Key Accountancy Processes

WORRY-FREE SECURE SAAS SERVICE • No software to maintain or install • Quick implementation • Hot disaster recovery built-in • Encryption of data in transmission and at rest • Redundant world-class data centers – US & EU • First and only financial close software provider to successfully

complete the following information security and controls audits: – ISO 27001 – SSAE 16 SOC 1, SOC 2, SOC 3 – ISAE 3402

Page 34: Automating Key Accountancy Processes

SAP CONNECTOR • Delivered by BlackLine as an ABAP add-on which can be easily

installed on the customer’s SAP ERP system • Allows designated users to load SAP balances and information

directly to BlackLine • No extra programming required • Uses pre-defined SAP security model and connection settings – no

security changes required • Company Code, Account, Business Area, Trading Partner and Profit

Center level balances • Other financial data – eg. Accounts Payable, Accounts Receivable

and Fixed Asset sub-ledger data, Currency Rates, etc.

Page 35: Automating Key Accountancy Processes

ROI & CUTTING COSTS • Auto-certification • Increased staff productivity • Reduced paper, printing, storage

overhead, auditor fees • Improved process management • Faster close

Return on investment is one of the most important indicators of value

MeadWestVaco Corporation ROI: 495% Payback: 2 Months

Cox Communications ROI: 227% Payback: 6 Months

Education Management Corporation ROI: 138% Payback: 10 Months “Using BlackLine software alongside SAP applications

has greatly increased the visibility, efficiency and accuracy surrounding our account reconciliation process. We now have a completely electronic and paperless process for how we review reconciliations.” Laura Darbro, Zurich VP of Close Operations and General Accounting

Page 36: Automating Key Accountancy Processes

EXECUTIVE DASHBOARDS

Dropdown menus make it

easy for users to switch between

roles and periods.

Page 37: Automating Key Accountancy Processes

ACCOUNT GRID

Quickly see statuses of

account reconciliations,

account identifiers, risk,

currency, balance and unidentified differences.

Page 38: Automating Key Accountancy Processes

BANK ACCOUNT RECONCILIATION

Easily add comments or

supporting documents to the

reconciliation.

Page 39: Automating Key Accountancy Processes

ADDITIONAL INFORMATION

Additional information such

as the account type, preparer and approver,

company policy, and procedures

are easily accessible within the application.

Page 40: Automating Key Accountancy Processes

AMORTISABLE PREPAID RECONCILIATION

Add comments or supporting

documents to the reconciliation,

helping to ensure completeness and

simplify the review process.

Page 41: Automating Key Accountancy Processes

Easily identify

unmatched and

matched transactions.

MATCHED/UNMATCHED GRID

Page 42: Automating Key Accountancy Processes

Reporting gives management real-time information to better manage

their processes

REPORTING

Page 43: Automating Key Accountancy Processes

REPORTING – MY FAVORITE REPORTS

• Users can move frequently

used reports into their My Favorites Folder.

• Those reports can be run or scheduled.

• The reports can be edited (such as adding or deleting columns, filtering, and sorting) and saved to meet the users needs.

Page 44: Automating Key Accountancy Processes

SAMPLE REQUIRED ADJUSTMENTS REPORT

Page 45: Automating Key Accountancy Processes

Magnesh Singh Financial Controller CNH Industrial Capital Australia

Stoyan Arnaudov Chief Financial Officer CNH Industrial Capital Australia

Page 46: Automating Key Accountancy Processes

Contains confidential proprietary and trade secrets information of CNH Industrial. Any use of this work without express written consent is strictly prohibited.

CNHI Capital Australia BlackLine Implementation Project

Page 47: Automating Key Accountancy Processes

46

BlackLine APAC Webinar

1. CNHI N.V - Corporate Profile 2. CNHI - Financial Services 3. CNHI Australia - Group Overview and Outlook 4. CNHI Capital Australia – BlackLine Implementation Project 5. Iveco Capital Russia – BlackLine Implementation Project 6. CNHI Capital Australia – Next Steps in Utilizing BlackLine

Contents

Page 48: Automating Key Accountancy Processes

CNH Industrial Our Products are tied together by Common Purpose

Professional income-producing industrial equipment and commercial vehicle customers

Full line distribution model through 12 industry recognized brands, with wide geographic coverage in 190 national markets

Best in class powertrain technologies

Over 71,000 employees, 62 manufacturing facilities, full lifecycle product services and financing

One of the world’s largest capital goods companies with 2013 sales of over $32 billion and assets of nearly $54 billion

47 47

Page 49: Automating Key Accountancy Processes

Agricultural Equipment

88%

Commercial Vehicles 3%

Powertrain 8%

CNH Industrial Company Overview

Construction Equipment

Commercial Vehicles

Agricultural Equipment

¹ Excluding financial services and before inter-company eliminations ²CE in negative operating profit position in 2013 3 Including financial services and after inter-company eliminations

$16.8bn

$4.4bn

Powertrain

$3.3bn $11.3bn

FY 2013 INDUSTRIAL NET REVENUE BY SEGMENT¹

Agricultural Equipment

47%

Commercial Vehicles

32%

Construction Equipment

9%

Powertrain 12%

INDUSTRIAL OPERATING PROFIT ($2.1BN) BY SEGMENT FY 20131,2

CONSOLIDATED NET REVENUES BY GEOGRAPHY FY 20133

INDUSTRIAL NET REVENUE BY SEGMENT FY 2013¹

EMEA 42%

NAFTA 28%

LATAM 19%

APAC 11%

Note: numbers may not add due to rounding

48 48

Page 50: Automating Key Accountancy Processes

Integrated and Diversified across Regions and Asset Classes

CNH Industrial Capital

NAFTA

LATAM

EMEA APAC

TRADE

by Region

70%9%

21%

AGCECV

Run as one business unit since 2013 Common policies and practices across

Regions Multiple operating models

More than 550k customers and ~3,100 dealers served worldwide

1,330 employees

14.7

8.5 1.0

1.5 3.5

50%

29% 4%

12% 5%

Managed Portfolio $29.2 billion (June 30, 2014)

by Segment

1 includes Iveco Capital

49

Page 51: Automating Key Accountancy Processes

50

BlackLine Implementation - CNHI Capital Australia Project Evolution

Project Evolution

2012

• GL Reconciliations performed in Excel spread sheets

• Transit Accounts having significant balances – up to $20m

• Time inefficiencies and variations noted compared to SAP balances and manual reconciliation balances

• Missing copies of reconciliations

• No major follow up on outstanding items

• Ageing of Outstanding Items were unknown

• Lead to a major write-off

2013

• Implementation of BlackLine

• Monthly GL reconciliations and sign-off

• Accounts with proper purposes stated

• Visibility of outstanding items

• Started ageing outstanding items

• Lead to weekly monitoring of the transit accounts balances

• On-time identification of operational and accounting errors

2014

• BlackLine ageing reports analysed on monthly basis

• Reconciliation processes and procedures added

• Reconciliations of key accounts performed within the 3-day close

Page 52: Automating Key Accountancy Processes

51

BlackLine Implementation – Iveco Capital Russia Project Updates

Project Updates

2013

• GL Reconciliations performed manually in Excel spread sheets on a “when required” basis

• There was no visibility of the transit accounts and no reconciliations of those accounts were performed

• Purpose and procedures of GL accounts were unclear to the local team and any new starters

2014

• Implementation of BlackLine

• Monthly GL reconciliations and sign-off

• Accounts with proper purposes defined

• Started ageing outstanding items

• On-time identification of operational and accounting errors

Page 53: Automating Key Accountancy Processes

52

BlackLine Implementation – Next Steps in 2015 The Future

White Glove Assessment

• Evaluate current use of BlackLine • Explore ways to improve on product underutilization • Discuss applicability of new enhancements

Task Management

Module

• Manage Tasks and Workflows • Improve visibility on Tasks

Journal Entry Module

• Centralize and Automate Manual month-end Journals • Streamline workflows • Improve Controls

Page 54: Automating Key Accountancy Processes

Questions? [email protected]

EFFICIENCY, SPEED & VISIBILITY REDUCED COSTS AND RISKS CONTROLLED FINANCIAL CLOSE