Financial Reporting and Consolidations for Sage 300

This article will discuss the best modern financial reporting and consolidation solutions, zooming in on essential features and functionalities that can upgrade your Sage 300 parent company financial processes.

There are plenty of Sage 300 customers who are overseeing the financial portfolios of parent companies with multiple subsidiaries.  Consolidating company data from more than one entity, sometimes with distinct currencies, can be a challenge without a powerful financial consolidation solution to sit on top of Sage 300 and any other ERP system that may be used within your enterprise.  Data is only going to grow in size and significance in corporate decision-making processes.  That’s why more executive teams are seeking the best tool to enable their business end users to aggregate information in a unified set of financial statements.  This article will focus on your software options for the Sage 300 customer who would like to achieve modern, powerful, and user friendly financial consolidations.  For fast growing companies, a good reporting and consolidation solution might have the additional advantage of extending the life of your Sage 300 implementation.

Financial consolidations combine subsidiary transactional data into a singular set of reports for a parent corporation.  These statements almost always include Profit & Loss, Balance Sheet and Cash Flow reports, and are made up of subsidiary information, directly demonstrating a parent company’s health.  Consolidations can include currency conversion for multiple money types, eliminations for transactions between subsidiaries, and any additional adjustments that need to be done manually without modern tools.  There are several reasons to consider today’s consolidation software, but there are a couple of overarching reasons that are driving some CFOs to shop around for a stronger tool to implement.

There are a couple basic reasons your finance team might be looking for an automated, modern consolidation solution.  Some are seeking to ditch their older tools that are too simple to meet today’s business demands, like manual Excel spreadsheets.  Others are hoping to retire their mature applications that are too complicated for business end users to manage, like Cognos or Hyperion.

Having spoken to several Sage 300 customers who are charged with consolidating financials for international parent companies, I have found some common threads.  Some are regularly converting currencies and making month-end consolidation adjustments in order to meet national and international standards, such as the International Financial Reporting Standards (IFRS) to Generally Accepted Accounting Principles adjustments (GAAP), typically referred to as IFRS to GAAP.  Some need to perform deep analytics with sub-ledger data and want a product that is positioned within a comprehensive suite of Business Intelligence (BI) software, fully integrated with modules for ad-hoc reportingplanning processesdata visualizations, and BI data storage.  Let’s focus on the Sage 300 financial consolidation experience for customers, particularly what you need to know before shopping for the right software for your company.

I have written about various data integration types before, but you can aggregate your data using the native reporting function in Sage 300 for real-time analytics, unfortunately equipped with inflexible report design and lack-of-depth consolidation features that most accounting systems suffer from, plus some potential slowness when it comes to querying data  – dependent on the size of the queries and if they are done simultaneously.  Most independent software vendor (ISV) consolidation software provide the choice to pull data from a high performance platform you can achieve with a BI data store.  However, this route does entail replicating your GL data from Sage 300 to a data warehouse or an online analytical processing (OLAP) cube.

Companies with less subsidiaries to consolidate, with less complicated or no currency conversions required, and/or without a reason to perform large, simultaneous data queries would be okay to utilize Sage 300’s native roll-up capabilities.  You can also use Sage 300 if you aren’t planning on pulling data from other sources into your analyses, producing complex automated eliminations, or additional adjustments beyond what Sage 300 can do.  However, BI data stores tend to enhance financial consolidations by pulling GL data from Sage 300, so this option might be advantageous for parent corporations with more complex aggregations.

You can schedule routine data replication to a cloud or on-premise data warehouse or OLAP cube, or you can manually click a button to send the data.  Sage 300 data typically replicates via a pre-built integration that connects to the Sage 300 database that will then feed the BI data store.  Consolidations are performed at a higher performance level due to the power and stability of a cube or warehouse.  BI data stores are beneficial for corporations with more complicated adjustments, currency conversions, larger or simultaneous data queries, and/or simply with a substantial set of company information to aggregate.  You should consider what modern consolidation functions you need to tackle your specific consolidation demands.

Intercompany eliminations.  Sometimes, one subsidiary might buy or sell goods or services from another subsidiary, resulting in cancelled out line items.  As a function, intercompany eliminations remove these transactions from the P&L and balance sheet, instead re-allocating the resources, which can be performed with Sage 300 or a BI data store.  Some BI tools even have configurable Excel input forms that you can utilize to manually eliminate or adjust inter-company exchanges in easy ways.

Currency conversion and consolidation adjustments. We’ve discussed currency conversion a little, and it is exactly how it sounds: multiple currencies get converted into a singular money type in the set of statements.  Consolidation adjustments enable finance professionals to meet domestic and global accounting standards, update inventory, and/or temporarily fix incomplete subsidiary data, along with other tasks.  In other words, these adjustments assist in statutory statement submissions.

Allocations, reconciliations, and modeling organizational changes.  Some companies choose to allocate specific expenses or revenues to certain departments, divisions, and/or subsidiaries.  Allocations can be done within Sage 300, or there are some data stores in which you can build allocation processes of varying complexities within the cube or data warehouse.  If you elect to go the BI data store route, lots of corporations like to have either parent company or subsidiary staff reconcile data to confirm accuracy, which can be done with Sage 300, BI front-end software, or in a BI data store.  Finally, some data sources empower you to model acquisitions, divestments, and/or reorganizations by duplicating and changing infinite company trees or hierarchies that you need.  You can view the impact on your portfolio with this function.

You have a lot to think about when shopping around for a consolidation tool, considering the complex nature of this process.  Solver, Inc. is happy to answer questions and generally review BI360’s easy-to-use, Excel- and web-powered consolidation tool for Sage 300 with both real-time or data warehouse integrated analysis, comprehensive reporting, budgeting, dashboards and collaboration as a way to accelerate company performance management.

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