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Session 10485: Oracle Financial Consolidation and Close in the Cloud
Richard Wilkie, Sr DirectorOracle EPM Product Management
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Safe Harbor Statement
The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.
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How are you keeping up with the increased business complexity & reporting requirements?
More than 70% of companies have more than 5
reporting standards.
Sources: E&Y’ Connected reporting Responding to complexity and rising stakeholder demands: 2014
50% of companies increased staff in the last 3
years to keep up with requirements
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EXAMINEYOUR CONSOLIDATION & CLOSEPROCESS
68%
57%
use Excel or e-mail to track the financial close, reporting, and filing process
State they have inadequate visibility across the close
86%
Say Non-Financial data is greater than 25% of required Filings
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Source: The Challenge of Corporate Reporting Research Study carried out by Dynamic Markets on behalf of Oracle and Accenture.
Manage the entire process…
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E&Y Confident Reporting, 2014
Just 27% say that they are highly effectiveat efficiency of production in corporate reporting,
and only 25% are very effective at speed of closing.
63% fewer FTEs used by Top
Performers in the Account-to-Report
Process.
Hackett A2R Performance Study, 2013
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DO YOU HAVE…
- increasing regulatory reporting requirements such as IFRS or local GAAP?
- a desire to streamline your close and perform more analysis on the results without increasing headcount?
- a single source for both financial & non-financial information?
- insight to real-time status of your close & a means of reviewing performance for continuous improvement opportunities?
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Evolution of Hyperion Consolidation Solutions
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Micro Control Hyperion Enterprise
Hyperion Financial
Management
Financial Consolidation
and Close Cloud
30+ years of experience and best practices allow us to constantly improve and evolve
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Best Practice Consolidation Out-of-the-Box
Comprehensively Address the Extended Close Process
Integrated, Secure and Auditable
Consolidate and Report With ConfidenceOracle Financial Consolidation and Close Cloud Service
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Ensures the use of best practices for an accurate and efficient financial consolidation and close
Makes it easy for finance departments to meet global financial regulation requirements like IFRS and GAAP
Significantly reduces timescale, cost and risk in the financial consolidation and close process
Best Practice Consolidation Out-of-the-Box
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Reduce the time it takes to complete the financial close
Ensure visibility and predictability in financial consolidation and close
Trust and reliability that the numbers are complete and accurate
No need to replace/alter existing transactional systems
Increase collaboration
Comprehensively Address the Extended Close Process
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Secure anywhere anytime access to latest financial information that remove the dependency on finance for generating reports and analysis
Improve the security, consistency and quality of financial reporting
Contain / reduce audit costs
Confidence in compliance with regulations
Integrated, Secure and Auditable
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• Consolidation– Predefined dimensions with built-in Financial
Intelligence
– Flexible application configuration with pre-built forms & reports
– Standard consolidations & eliminations
– Currency translations and FX adjustment calculations
– Built-in KPI ratio analysis
– Custom calculations using member formula
– Automated Cash Flow
– Data source detail tracking with drill through capability
– Multi-GAAP support
– Approvals
– Journal entry with approvals
– Intercompany matching
– Data audit
– Data Management
• Close Calendar (can be used standalone)
– Task Management
– Workflow
• Supplemental Schedules (can be used standalone)
– Data Collections
• FCCS Dashboards
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FCCS Functionality
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State of the Union
• Hundreds of customers to date
• Many large customers and deployments – Over $1B
– Over 100 users
• Every Region - APAC, EMEA, NA/LAD
• Partners around the world have been trained
• Early Adopter Support ensuring success
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Modernizing the Financial CloseThayer Lodging Case StudyKevin Hebbel, Senior Manager – SC&H Group
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Thayer Lodging at a Glance• Thayer Lodging is a leading global hospitality investment company, with more than two
decades of experience in creating value from owning and operating hotels.• Thayer Lodging’s goal is to be the world’s premier private equity hotel investment firm.• Thayer has established relationships with several leading international hotel brands such as
Marriott, Hilton, Starwood and Hyatt
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Thayer’s Close Process – Before Transformation
Background
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• Growing company with consistently changing portfolio of hotels
• Existing financial systems are inflexible
• Cannot produce seamless reports across their entire portfolio
• Need dual purpose application to enable consolidated reporting and detailed hotel level reporting
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Thayer’s Close Process – Before Transformation
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• Executing financial close/consolidation and related reporting processes via a manual and spreadsheet-centric process
• Close process took too long to complete with quarter and year-end closes dragging on further
• Difficulty meeting reporting and audit deadlines
• Excessive rework, reconciliation and review of the reporting and board packages
• Dependency on Excel to collect data and produce consolidated reports
Key Close Process Challenges
MANUAL PROCESSES
INCOMPLETE INFORMATION
AUDIT ISSUES
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Thayer’s Close Process – Before Transformation
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• Entity structure includes over 150 entities with intercompany challenges and partial ownership considerations
• Availability and granularity of data is limited and burdensome to collect resulting in inadequate analysis capabilities
• Numerous manual hand-off points of data and reports
• Lack of visibility and control into consolidated data and adjustments
Key Close Process Challenges
SECURITY QUESTIONS
LACK OF GOVERANCE
LIMITED VISIBILITY
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Thayer’s Close Process – Before TransformationData Flow
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Thayer Solution Overview
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Key Requirements:1. Reduce Time to Close2. Enhance Visibility and Control3. Compliance with Global Standards4. Cloud Based5. Rapid Implementation6. Owned by Finance and Accounting7. Minimal IT Investment
Solution Overview:Combined implementation of:1. Oracle Financial Consolidation and Close
Cloud Service (FCCS)2. Enterprise Resource Planning Cloud
Financials
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Thayer’s Solution OverviewProduct Selection and Implementation Timeline
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Thayer Solution OverviewData Flow Diagram – Before Transformation
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Thayer Solution OverviewData Flow Diagram – After Transformation
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Thayer Solution OverviewProject Results
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• Rapid deployment to quickly yield benefits from the investment
• Significant reduction in time to close
• Complete visibility into entire close process from data collection to reporting
• Created dual purpose application for corporate consolidated reporting and detailed hotel reporting
• Compliance with global accounting standards
• Reduced the dependency on Excel
• Eliminated risk, manual processes and excessive reconciliation and rework
• Increased confidence in the reporting of financial results
• Accounting and Finance team have the control with limited IT resource requirements
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Thayer Solution OverviewProject Results
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Before Transformation
Average Close – 12 business days
Lack of control and manual processes
Limited visibility into the close
Complete dependency on Excel
Complex and manual data integrations
Manual and error prone Excel reports
Existing systems required regular updating
IT capital investment and resources a concern
After Transformation
Average close – 6 business days
Best-in-class control and automated processes
Constant understanding of close status
Excel used for ad-hoc analysis
Seamless and automated data integrations
Consistent system driven reporting
Upgrades are automatic
Minimal IT Investment
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Thayer Solution OverviewLessons Learned
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Lessons
Learned
1. Involve the end-user community early and often as they are the key to change management on a rapid implementation.
2. Begin testing and knowledge transfer as early as possible in the project life-cycle.
3. Keep it simple and recognize that the solution brings value without requiring complexity.
4. Be realistic about project team time commitments and mitigate this risk before the project starts.
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Financial Consolidation and Close CloudWhat’s Next?
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Financial Consolidation and Close Cloud: Current Release and Roadmap
• Alternate Hierarchy
support (full accounting
treatment)
• Ability to use Close
Manager and
Supplemental Data
Manager Standalone
• Tight integration with
Financials Cloud
including drill back
• Process Control
• Adv. Consolidation
Phase 2• Ownership Register
• Org by Period
• Close Manager • Monitoring tasks
• Cloud integrations
• Supplemental Data
Manager• Integrations to On
Premises
Current Current +2
• Adv. Consolidation
Phase 1 (Similar to Manage
Ownership in HFM)
• Config translation,
calculations and
consolidations
• Extend custom
dimensions
• Cross Pod Integration
• Close Manager
Integrations
• Platform Sizing and
Performance
Current +1
• Journal Entry Module• Integration with any
ERP
• Recurring and Auto-
Reversing
• Single click create
• Adv. Consolidation• Automatic Journaling
• Data lineage
• Automatic
consolidations
• Integrated XBRL from
EPRCS
• HFM Migration Toolkit
Future Post 12 month
HFM functional parity coming soon in 2017
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Extended Dimensionality
• FCCS System dimensions include common customers in HFM– Data Source, Multi-GAAP
• Current designs limits analytic capabilities for some customer requirements
• Add new dimension to existing application– Historical data maps to NoXX member
• Create new application with up to 6 customs
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Custom Calculations
1. Calculation Manager will be opened up to allow partners to create Business Rules that can be executed at predefined points within the default consolidation process.
2. The library of predefined rules will be expanded to support common operations like Copy, Clear etc.
3. POV specific translation mechanism will be supported.
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Configurable Translations
• Application Level– Periodic / YTD method (i.e. PVA or VAL)
– Average / Ending Rate
• Overrides– Applies to specific POV slice
– Select Translation Method – Periodic / YTD
– Select Rate Account (support relative reference – Current, Prior, First, Last) • Support new Rate Accounts
– Add / Subtract option (i.e. Translate using Rate1 – Rate2)
– Configurable UI – no script
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Update Default
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Custom Override
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Advanced Consolidations• Manage Ownership– Establishing ownership parameters such as Ownership %, Consolidation %,
Consolidation method period-by-period
• Proportional Consolidation– Applying consolidation percentage to proportionalization and standard eliminations
• Advanced Consolidation– Elimination rules for Investment / Owner’s Equity based on Ownership parameters
– Single or multiple ownership/cross holdings
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Manage Ownership - Methods
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Manage Ownership – By Entity
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FCCS Benefits
• Single EPM platform
• Configure not customize
• Leverage best practices
• Always up to date
• Built on 30+ years of Hyperion expertise
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Financial Close Cloud Complete Solution
Financial Consolidation
and Close
Account Reconciliations
Tax ReportingEnterprise
Performance Reporting
Complete End to End Close Offering
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• Address the global reconciliation process
• For each process provide complete lifecycle including –verifications, tracking of assignments, managing preparation and review, minimizing risk and optimizing the process.
• Integrated with transaction systems
• Transaction Matching Option
• Flexible and robust user owned reporting
Oracle EPM CloudAccount Reconciliation
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• Comprehensive Tax Reporting solution
• Tax Provision, Country by Country (CbCR), Uncertain Tax Positions, Workflow & Task Management
• Integration with ERP, financial consolidation and reporting solutions – Cloud and on-premises
• Mobile-enabled User Interface
• Fusion Tax Integration for “Total Tax Analysis”
Tax Reporting
Oracle EPM Cloud
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• Narrative-based management and external reporting in one
solution
• Complete: Authoring, collaboration, commentary and delivery
• Robust Report Development Lifecycle Management
• Seamlessly leverage existing documents, data sources and
reporting content
• New centralized EPM Cross-Cloud reporting
• Secure: Role-based, auditable access on desktop and mobile
devices
Enterprise Performance Reporting
Oracle EPM Cloud