Corporate accounting departments are keepers and curators of financial data. One of their greatest responsibilities is the financial consolidation process, which involves tedious information gathering, validation, and reporting. For many businesses, this process can take weeks or months.
Parent companies create different legal entities (e.g., companies, locations, divisions, subsidiaries, partnerships, and funds) for reasons like liability, taxes, and strategy. Consolidated financial statements group together all the related entities that are under a single parent company’s control.
Today’s consolidations are more complex for many reasons, including geographic growth, varying accounting rules between jurisdictions, and international business activities requiring multiple currencies. Consolidation timelines are also more urgent. Reporting deadlines are being tightened to meet stakeholders’ demands for transparency and a single view of financial performance.
These challenges worsen if you use a small business accounting application. Because such software can’t handle complicated consolidations, you rely on spreadsheets – but the manual data entry, copying, and pasting waste time and lead to expensive mistakes.
Many financial executives are moving to modern cloud financial management systems like Sage Intacct to keep up with a fast-paced business environment.
Next-Generation Financial Consolidations
A truly integrated cloud financial management system allows you to automate the consolidation process. Automation has many benefits, including:
- Faster initiation and integration of new entities in any global jurisdiction
- Improved control and centralized financial functions
- The ability to drill down from the consolidated perspective to the operating entity for unparalleled insight
- Greater coordination between business units and corporate accounting throughout the close process
- Real-time consolidation without waiting for period ends
- Circulation of timely information with confidence
- Enhanced credibility of the finance function
- More time to spend on higher-value work
To learn more about Sage Intacct and how it can help you close the books 25-70% faster, download the whitepaper below.