The company

AEM Torino is a local stock market-listed utility company operating in the electricity, gas, district heating, and integrated energy service sectors.

Project Objectives

The aim of the project was to provide AEM Torino with a financially oriented software application that would allow it to monitor commercial performance across the Group.

The project was intended to deal with the areas of closing and allocation of actual figures for all aspects of management analysis for corporate bookeeping purposes.

Additionally, there was a wish to meet the challenges involved in both statutory and management consolidation of the Group companies' accounts.

A further aim involved managing and monitoring the process of collecting the budget and forecast profit and loss data so that this could be fed into the financial and capital projections for the Group.

Finally, after the introduction in Italy in 2001 of the new Section 310 regulations on separation of accounts in the energy sector, AEM Torino was eager to prepare its financial statements in accordance with the principles of regulatory unbundling.

Project Scope

The broad scope of the project involved the implementation of all of the Tagetik CPM process modules, albeit in distinct phases: Closing & Allocation, Consolidation, and Budgeting & Planning of profit and loss for both capital and financial planning purposes.

The Closing & Allocation process has allowed the Group to obtain actual and forecast accounts by Business Area, Accounting Sector, and Cost Centre. It has also enabled the management reporting book to be generated, thereby providing every manager with "cross-functional" reports that they can use to gain an overview of the sources of any costs thanks by means of Activity Base Costing (ABC) principles. These reports show costs allocated to and received from other cost centres. All of the master data, organizational figures, and actual accounting figures are supplied from the SAP ERP system and from other subsystems. The definitive actual figures are then closed off within Tagetik CPM and allocated in line with the activity-based costing principles described above.

The profit and loss budgeting and planning phase has enabled all managers to monitor the data entry activities carried out by the various contributors, to verify on a daily basis any costs assigned to them by other cost centres, and to validate figures arising within their own area of responsibility.

The Financial Planning process, meanwhile, has allowed the AEM Group to draw up—with a high degree of detail—both the capital and financial budgets and to draft out ten-year financial plans for each accounting area. Any direct taxes are calculated automatically.

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