Not-for-Profit Financial Reporting and Roll-ups with Dynamics GP

This article focuses on financial reporting and roll-up solutions for not-for-profit organizations utilizing Microsoft Dynamics GP.

Financial reporting and consolidations can mean different things to different people. Many larger Microsoft Dynamics GP not-for-profit customers are managing the finances of a parent organization with multiple locations rolling up to it. First things first, let’s define financial roll-ups or ‘consolidations’ as it is typically called in the corporate world. It can simply mean that an organization is combining data from multiple locations either as part of the planning process or for reporting purposes. It can also mean a lot more than just combining data. Financial consolidation is the process of aggregating transactional data from several departments and from multiple business entities within a company for the parent company. In these cases, simply combining data can be complex for multiple reasons. For instance, legal entities can have different charts of accounts or fiscal years. They may also be partially owned. This article will explore the elements and functionalities of financial consolidation for your non-profit organization using Microsoft Dynamics GP.

Consolidating organizational information from more than one place, especially with diverse currencies, can be a tedious task without a financial consolidation solution. Data continues to grow in size and significance in terms of decision-making which is why executives are shopping for the right tool to allow their business end users to aggregate data into financial statements or for summarized operational reports. Say goodbye to double entry and piecing data together from multiple systems in Excel. You can get access to your organization’s data from one place.
Consolidations typically entail currency conversions if you have entities in many countries, inter-company transaction eliminations, and any additional adjustments that need to be done manually in GP or right in the financial consolidation tool, so you can make a comprehensive illustration of the parent entity’s financial well-being. There are many reasons to start looking for a software that facilitates financial consolidations. Some of the benefits your not-for-profit gains from merging your financial data with GP are serving the needs of the members with better impact, managing the four critical elements of grants, funding, encumbrances, and commitments, using your budget and other resources more effectively, and increasing financial insight and control. Using Microsoft Dynamics GP, non-profit organizations can manage fundraising, Point of Sale (POS), payroll, travel expenses, time and attendance at the lowest cost possible.
There are some financial consolidation solutions that offer flexible, sub-ledger analytics and are positioned within a full Business Intelligence (BI) suite, fully integrated with other modules such as ad-hoc reporting, budgeting, data visualizations, and modeling. We are going to take a look at the details of financial consolidations for GP, including what you should know when looking for the right solution for your non-profit organization.
Companies with a few entities to aggregate, with little or no currency conversions needed, and/or without the worry of slowing down the GP server with larger data queries would likely thrive with a live integration. If you are not planning to use other data sources, and you don’t need additional adjustments beyond what GP can do, I suggest you stick with GP. On the other hand, several data warehouses and online analytical processing (OLAP) cubes do provide consolidations by pulling general ledger (GL) data directly from GP, so this is a great option for organizations with various needs.
You can reproduce information to a data warehouse or an OLAP cube with routine, scheduled refreshes, or with a manual push. Usually through Microsoft SQL Server Integration Services (SSIS), data from GP will replicate to the BI data store, and consolidations can be run at a more powerful level due to the strength of your data store. If you are uneasy about the speed of GP with your data querying when you perform more complicated work like currency conversions or the overall large amount of data, a BI data store will benefit you the most. You should be evaluating which consolidation functions are needed to meet your specific business requirements.
Let’s start with intercompany eliminations, currency conversion, and consolidation adjustments. Over time, one entity may buy or transfer assets to/from another entity, which then cancels out the line items for both entities. Intercompany eliminations disconnect these cancelled out transactions from the profit and loss statement (P&L) and balance sheet since you are re-allocating options, which you can do with GP or a BI data store. There are some BI tools that provide Excel input forms that your company can use and customize to your needs to adjust intercompany transactions or manually remove them. Currency conversion enables multi-national companies to combine their transactional data into a singular company report with one currency through this function. Consolidation adjustment allow accountants to meet domestic and international accounting regulations, update inventory, or temporarily correct incomplete entity data, in addition to other functions. These elements help out in the task of submitting consolidated financial statements for the corporation as a whole.
Allocations, reconciliations, and modeling company changes are significant supplementary functionalities that should come with modern financial consolidation solutions. Some companies decide to allocate expenses or revenues to a department, a division, and/or a particular entity. You can run these allocations with GP, while inputting the information to a BI solution, or sometimes, you can build allocation reports of varying complexities within a BI data store. If you and your team decided that a BI data store would be the best option, many companies like to have either parent company or entity personnel reconcile the information to make certain everything is accurate, which can be done with GP, BI front-end software, or a BI data store. Lastly, some data sources enable you to model reorganizations by changing all the organizational structure or hierarchies that you need. With this function, you will definitely see the influence.
Clearly, there is a lot to consider in the shopping process for your not-for-profit financials.
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