The simplest ideas are always the best!

A recent web interview with Lindsay Morgan, global process owner for the ‘Record to Report’ process at Medline Industries Inc. illustrates how the straightforward step of transitioning from a spreadsheet-bound financial consolidation process to a dedicated consolidation tool can literally transform the finance function.

FSN’s Future of the Finance Function research in 2017 showed that many finance professionals are ‘swimming in treacle’ when it comes to delivering value to the business. They want to be more strategic, advisory and proactive, yet find themselves totally hide-bound by manually intensive processes that leave little time for anything else. And so it was for Lindsay Morgan, whom up until recently was spending all of her time bogged down in the ‘mechanics’ of the statutory consolidation.


CCH Tagetik Consolidation

In common with many other businesses, Lindsay found that once the number of reporting entities gets beyond thirty, a spreadsheet-driven process becomes slow, unwieldy and risk prone. In Medline’s case the manually intensive process drove up audit costs as well. It became increasingly clear that the process was not scalable in the face of double digit growth (revenue went from $3 billion to $10 billion) and an ambitious acquisition programme that added 30 more statutory entities in a matter of 6 years.

To make matters worse, acquisitions bring with them a jumble of operational and ERP systems that all must be tied individually into the corporate consolidation. So how does a modern finance function quickly reassert control and order?

The answer is surprisingly simple and elegant. Modern financial consolidation systems such as CCH Tagetik are simply super-imposed over the existing systems landscape. Local operational systems are mapped to a group reporting pack bringing consistency and standardisation at a stroke. And it is this standardisation, together with the elimination of spreadsheets for data capture and specialised consolidation functionality (rather than spreadsheet macros) that carves great swathes of time out of the process. Indeed, Medline reduced its yearly audit cycle time from 5 months to 4 months. But the investment, which only took a matter of months to implement, has transformed the way the finance function works and is perceived.

As Lindsay says in this interview, “We’ve expanded the scope of our roles, expanded our business partnership and improved our cost credibility with the auditors and executive. We are no longer just accountants in the back-office, now the company refers to us for future ideas and financial integrations as well as supporting the business with our understanding of the impact of currency fluctuations.” That’s modern finance in action!

CCH Tagetik Consolidation

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