Upfront: Where Reporting and Consolidation Need To Improve

Companies have made great strides in the last decade in automating their financial reporting and consolidation processes to meet burgeoning regulatory requirements and to provide decision-makers with more timely access to the data they need. But there's still plenty of room for improvement in these areas for most organizations, according to a report from Ventana Research, sponsored in part by Business Finance magazine. The study polled more than 200 finance, IT and line-of-business employees at large companies.

Companies' investments in reporting systems have streamlined and focused their data delivery over the past decade. Only 10 percent of respondents say that a "significant portion" of the information they receive is unimportant or not useful. And one-third of participants say that "very little" or "none" of the information they receive answers that description.

But an analysis of information received by category reveals some gaps in data delivery. When asked to gauge the adequacy of information they receive relating to their own performance, participants are fairly evenly split: 53 percent say they receive enough information, and 47 percent say they do not. Half of respondents think that their organization provides too little in the way of leading indicators of the company's health. And nearly 80 percent want to hear more about competitors' performance.

Accelerating the monthly and quarterly closing process has long been a goal for finance, and here, too, companies have achieved considerable success, the study notes. However, a majority of respondents (58 percent) report that their organization takes more than four business days to perform the monthly accounting close. That's longer than most would like; 73 percent say that the optimum amount of time to close would be four days or fewer. More than half of those polled (53 percent) would like to see their quarterly close accelerated, too; 78 percent of respondents report that this process takes five or more business days.

The survey notes a correlation between the use of spreadsheets and the time required to perform the monthly close. Forty-nine percent of companies that report limited spreadsheet use perform that task in four days or less, compared with only 27 percent of the heavier Excel users.