CFOs like Larry Carter of Cisco Systems assert
no longer about the big beating the small,
it’s about the fast beating
the slow,” and fund managers demonstrate
that they are prepared to pay up to 20% more
for companies that can publish trusted, transparent
financial statements, companies have got to
You need to assess whether your financial
processes inhibit or promote these market imperatives. And if there are
any lingering doubts as to the pressing need for a finance organization
to be able to effect a “fast close” and more accurate,
transparent reporting, just look at recent headlines. The demise of Enron,
WorldCom, Tyco, and others were not momentary news blips. The repercussions
are being acutely felt worldwide, and will be for years to come. The CFO
and CEO of any corporation listed on any U.S. stock exchange, for example,
have to personally certify that the corporate financial statements do
not contain material false facts. At the same time, companies will be
required to disclose more extensive information in a shorter time (see
the latest SEC initiatives). This is not an easy task, and represents
one of today’s major challenges for CFOs.
The problem is that traditional financial
reporting techniques and processes are too cumbersome to enable organizations
to deliver financial information with more trusted figures and with far
greater speed and accuracy. What’s more, if they cannot deliver
internal management reports and forecasts faster, they will be unable
to manage internally what they must report externally.
What stands in the way? Well, setting
up the accounts and generating timely forecasts that account for all subsidiaries
is complicated, particularly for multinationals. Also a “period”
isn’t necessarily a fixed number of days anymore; it may be tied
to a project’s lifecycle. Transparency of operations across disparate
systems is yet another hurdle, and so is reorienting your processes and
organization to adhere to new or multinational accounting standards. What
is needed is a new approach to accounting, reporting, and forecasting,
with new processes, organizational models, and systems.
How else can you attempt to develop, execute,
or refine an effective strategy and manage performance when you’re
grappling with inaccurate figures, periodic closes that take you by surprise,
unclear reporting processes, auditors who require lengthy review cycle
times, and differences in accounting principles? The quality and transparency
of your financial data and the speed with which it’s delivered are
inextricably linked to sound management and forecasting processes.
SAP solutions can help.
In this day and age, I understand the
reluctance to embrace anything that is perceived as introducing costs.
Let me assure you — every SAP customer can afford faster, more accurate,
more trusted financial processes. You’ve got the groundwork in place
with your current SAP implementation. What you will find is that SAP solutions
can reduce your cost of finance by as much as 44% (Source: The Hackett
Group). Our solutions will also enable you to achieve tighter linkage
between finance and other key business processes, increased accountability
and control, and ultimately better insights and decision making —
benefits you now can’t afford to be without.