Accelerate your business:

Performance reporting essentials

A white paper prepared by Prophix

Accelerate your business: Performance reporting essentials

Executive summary
Reporting is a vital means of communicating internally and externally between key financiers and other stakeholders of an organization. he ability to report timely and accurate data is an essential component to operating a successful business! and can spawn a myriad of other activity aimed at meeting corporate ob"ectives. #espite the importance of this necessary business function! there is plenty of research pointing to the fact that organizations are still dealing with challenges and problems related to satisfying their reporting needs. $n a research study conducted by %nox and Rogers of &'( Research )ervices! respondents called for easier analysis capabilities*where +, percent said that improving the ease of analysis of their

$n another study! conducted by Robert %ugel of -entana Research! similar results were found. half of the respondents were not receiving enough leading indicator information that point to the future performance of the company./
performance data would yield the greatest business benefit.,

0oth of these research papers! along with others! point out issues that organizations are experiencing when examining the performance of the company! be it financial or non1financial! specifically! reporting corporate results and the ability to analyze this information. $n addition to the analysis issue! activities relating to planning! accurate consolidation! and budget pro"ections are often wasted opportunities to effect business change. he old adage 2garbage in! garbage out3 comes to mind when reporting inefficiencies exist. Reporting is only the starting point! and when companies spend time working out reporting issues! they often spend less time! or no time at all performing analysis! and planning their next course of action. 4any of the difficulties that companies are enduring stem from the fact that numerous organizations are still using reporting and planning systems that are not conducive to their growing needs! are separate systems! or their systems do not evolve to easily accommodate add1on functions such as ad hoc analysis! forecasting! or personnel planning. 'or example! 4icrosoft Excel /

Accelerate your business: Performance reporting essentials

is a flexible tool that is easily deployable to stakeholders! and therefore! continues to be a tool used to create various financial and non1financial reports and analysis. 5owever! with this flexibility comes challenges. it is a double1edge sword. 6sing Excel to create reports can be time consuming! and when it comes to updating! managing and analyzing them! it can be even more laborious and time consuming. $n addition! Excel does not expand well to allow other abilities! such as forecasting! consolidation! ad hoc analysis or automated revenue and cost allocations across multiple departments
or entities.

, )am %nox and &elina Rogers! Performance Reporting and Analysis: 'inance Executives )eek 0etter Applications to #ig #eeper 7&'( Research )ervices! /889: / Robert %ugel! 0ringing 'inancial Reporting into /, &entury 7-entana Research! /88;:
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Accelerate your business: Performance reporting essentials

&ompanies have begun to divert away from Excel and now understand that there are improved tools that are better e=uipped to meet all their business needs and they recognize that reporting is only one re=uirement. &ompanies are investing in dedicated tools that enhance and make the reporting and other business processes more effective. Analysis and planning capabilities can be brought to the desktops of stakeholders! providing an environment that allows complex planning and effective decision making. >ith proper setup! reporting for an organization can be a catalyst to improving a business? bottom line. A complete performance management system can be obtained! which allows your organization to spend more time analyzing and planning instead of manipulating data into useful forms. his creates an environment that empowers end users and stakeholders to understand the current business situation! allowing for =uick reaction to foreseen and unforeseen business changes. he ideal reporting and performance management package should offer key capabilities and functionality permitting financial and non1financial users to find the answers they need to perform their "ob more effectively. o improve your current reporting process! find a package that gives you easy access to more information while still providing an ample amount of detail with the ability to perform other functions built upon the reporting data and infrastructure. >ith such a reporting tool! analysis becomes more efficient and accurate! and effective decisions can be made in a consistent manner.

Performance reporting essentials 0y realizing the key components and features that should be taken into account when looking for a reporting package! a substantial return on investment can be expected. @

Accelerate your business: Performance reporting essentials

his white paper focuses on those core capabilities and helps to define what a company should be receiving from a reporting package. his not only ensures that the best solution is found to solve the reporting issues! and to improve your business! but it also addresses the need for a full performance management solution a tool that can propel your business forward with visible benefits in business analysis! consolidation! allocations! planning! workflow tracking and forecasting. Aisted below are some of these core functionalities. Prior to investment! find out what features and tools are fundamental in a reporting package. 1. End-to-end reporting solution he ability to structure financial and non1financial reports around business re=uirements is essential to a useful reporting process. 0usiness re=uirements are changing at lightning speed today and having the proper tools to react in a timely manner has become invaluable.

Accelerate your business: Performance reporting essentials

5aving the ability to pull various report types from one system is not only a timesaver but has become a corporate necessity. 'inancial statements measure corporate success! management boardroom reports can pinpoint troubled or distressed areas! and ad hoc data reports bring accuracy and relevance during the planning periods. Advanced reporting software provides an easy interface for gathering this type of information. (nce this information is stored within such a system! it is available for multiple reporting types and satisfies various reporting needs. B 'inancial reporting*'ully detailed financial statements: income statement! balance sheet! cash flow statement! pro1forma financial statements B 4anagement reporting*Con1financial and financial visual reports displaying the overall health of the organization B ransaction reporting*#etailed views of transactional data! helping to analyze errors and anomalies B Ad 5oc reporting*Draphical slicing and dicing and drill1 up! drill1down! or drill1 through features! enabling the move from reporting to analysis Reporting should be an ongoing process with fre=uent opportunities for managers and other stakeholders to view the latest internal and external data on the performance of the company. his information should be available in various forms to ade=uately address the interests of all vested individuals.

Accelerate your business: Performance reporting essentials

2. Visual reporting capabilities (dashboards, scorecards, charting) A chart can communicate all corporate details in such a way that information can be easily absorbed. An exception report can visually display what variance areas are outside the limits and deserve attention. a dashboard report provides a dynamic management style report used to monitor critical information at a glance. Draphically evaluating your business not only satisfies the corporate need for various report types! but it also brings value to the different investors of the business. 'or the

Accelerate your business: Performance reporting essentials

everyday user! the numbers and detailed company data can make all the sense in the world. 'or people that do not look at numbers every day! they will want visual answers to their specific =uestions. his type of reporting interface delivers user1specific information relating to the health of the business! for executive management and all other levels of the organization! creating a better! more informed decision1making environment. 4ost reporting tools will offer this type of reporting! on top of the needed financial statement and ad hoc reporting re=uirements. 3. Sta eholder in!ol!ement Remember that people often re"ect products that are difficult to learn or do not meet their needs. Avoid investments in tools that only encourage users to revert to old processes. $nvest in a reporting tool that is user driven and encourages control. (ne key feature to assist in this is providing a reporting tool that allows various stakeholders to be involved in the planning and reporting xprocess. Ensure that your software program provides the ability to disseminate corporate information to key stakeholders! all within
a timely process and with security intact.

The responsibility for accurate financial reporting ripples through the entire organization it is why the course targets more than financial executives. E

Marie Leone,

!".com

Accelerate your business: Performance reporting essentials

(ne meth od of guar ante eing this is to distri bute corp orate repor ts to indivi duals from a repor ting softw are progr am. )che dulin g repor ts to be distri bute

d will bring correct information into the correct hands! at the correct time. here will no longer be excuses to unfinished analysis or reporting of information. Another assurance of stakeholder involvement revolves around ease of use. 4icrosoft Excel is one of the most dominant players in reporting. >hy is this the caseF (ne of the main reasons is that it is easy to navigate providing a simple interface for building and formatting reports. Excel is so easy to use and has large user acceptance because it provides a graphical user interface 7D6$:. his technology is developed with the business end user in mind. $ntroducing a reporting package that provides a D6$ interface will significantly shorten learning curves. )oftware packages that support a similar D6$ interface allow users to build on their skills and certainly increase user buy1in. All departments will become involved in the reporting loop. Aastly! a large reason why stakeholders are often not included in the planning and reporting process is because of control. 5ow can you control the process and guarantee that individuals are only participating in what they should be participating onF 4anaging access levels and the information approval process is necessary for accurate analysis and reporting. Ensuring that stakeholders? tasks are well defined and can be managed is possible. he tool of choice should have a full workflow process that visually displays the stages and responsibilities of the individual! providing a concise and timely portrait of the process. ". Secure interface )ome corporate information is privy to only a select few! within or outside of an organization. (ne of the biggest criticisms against certain software programs! such as Excel! is that nothing is truly locked down and secure in an Excel worksheet. A locked

sheet can simply be copied and pasted to another location and then changed. Hou want users to be able to access enough data in order to ask the right =uestions and perform the re=uired analysis! but you also want to limit the kind of data accessible to them! such as another department?s payroll information. $t is pertinent that a secure interface be present within the reporting tool to protect information from landing in the wrong hands. Providing an adaptable! yet secure interface is prudent in today?s business environment. he flexibility to change user access levels is necessary! however these capabilities need to be controlled and managed only by the proper personnel. A reporting tool that uses an (AAP 7online analytical processing: database provides this necessary control. )takeholders only access the information that is relevant to them! and as time progresses and needs change! access levels can be altered. his environment is secure! yet flexible and scalable for accurate
data analysis.

)entana *esearch

The nee# for enterprise$ class #ata integration has never been more pressing. "ur research has foun# few rea#ily available tools that %T can use to fee# the enterprise&s hunger for information. Mar' (mith,

#. $ntegration capabilities &orpo rate inform ation! wheth er financ ial or non1 financ ial! genera lly reside s in variou s softwa re system s: financi al inform ation usuall y lies in the gener al ledger ! sales data uses a

sales database! personnel related information resides in a human resource database! and possibly other industry1specific systems are being used for inventory! products andI or manufacturing. >hen you need to analyze data and create reports! the information needs to come from these various data sources. he reporting tool has to be able to pull data from more than "ust your general ledger system and must have access to other systems for suitable reporting capabilities. $t should be able to obtain product codes! customer names! ac=uisition models! tax notes! statistical stores! and detailed personnel data. he reporting tool should act as a consolidation tool! bringing together the various data sources and accurately reporting this information in a precise manner. Reporting tools that offer (#0& connectivity provide a user interface that re=uires little to no $ involvement and creates a menu1driven import functionality. he integration of systems and the consolidation of information can be a business1driven process based on your business re=uirements. %. &rom reporting to data anal'sis Providing stakeholders with information is good practice! however! the usability and flexibility of this information are two very important components that will determine if it is valuable. 5aving all of your data staged in one database provides an environment that gives users a nice and organized interface to =uickly access data. An (AAP database and the technology inherent within provides the ability to analyze data from many points of views! for example! viewing your corporate income statement then drilling through to view specific departments or cost centers? operating expenses or viewing sales reports and drilling through to transactional detail to analyze the products sold and the sales managers who sold them.

)electing this information and slicing and dicing through a simple drag1and1drop functionality should be inherent within the reporting software. Reporting software needs to offer a valuable experience for stakeholders! creating an atmosphere where stakeholders can take ownership and manage the information that is necessary to do their "obs! all with little to no $ involvement. (. )udit control oday?s business environment demands that companies are adhering to industry standards and are following all compliance1related issues. 0eing able to control! track! approve and review during different business processes is a necessary component of doing business today. 'or example! creating comments related to certain business
actions will aid in the planning cycle.

!" *esearch

!inance executives say that their ability to analyze #ata $ to perform what$if, #rill$ #own analysis to answer non$ routine, unstructure# +uestions hol#s them bac' from #elivering real business benefit. (am ,nox,

Diven that report ing is one of these re=uir ed busine ss proces ses that a comp any must adher e to! contr ol throu ghout the proce ss is mand atory. he report ing softw are shoul d provi de the tools to revie w and

approve reports! track report changes and manage the reporting process. 4any reporting software programs have these capabilities and make it a user1friendly process that is easy to follow. *. &ull soft+are solution $mplementing an application for reporting may only be part of your solution. where can you analyze data prior to and after reportingF >here do the necessary forecasting! budgeting! advanced planning and consolidations happenF here are solutions that offer a feature1 rich! comprehensive planning software suite*complete solutions for budgeting! reporting! forecasting! consolidation and planning. (ne way to ensure this is to invest in a solution that has a centralized database! where all information! historical and plan! is stored. A centralized database will have the data staged in one database! giving stakeholders a complete and organized interface to =uickly access data. 0ecause there is only one interface! it is a good place to start the planning process. Plan numbers can be forecasted out and trend analysis can be used to accurately estimate the variances based on the previous year. A reforecast can be created to truthfully portray whether targets will be reached. Hour reporting package should also make it easy to create variance reports and process advanced consolidation calculations. Extend the capabilities of your existing accounting! ERP! and other data source systems and protect the investments already made in reporting software. >hen researching reporting software programs! ensure that the solution can offer more analytical capabilities than "ust reporting. $nnovative organizations use software systems in other ways beyond reporting. A partial list of applications and business challenges that software programs address includes customer profitability analysis! product line analysis! inventory management! sales forecasting! cash flow forecasting! scenario planning! multi1year budgeting! forecasting and workflow management. he closer you are to live data! the more accurate the analysis!

and a

better return on investment will be reached. Ensure a centralized database is a core component of the reporting tool.

About Prophix Prophix is a leading developer of innovative performance management solutions designed to automate financial and operational processes! making companies more profitable and reducing their risks. housands of finance leaders in nearly one hundred countries use Prophix to empower their organizations and gain valuable insight into business performance. Prophix and its partners deliver superior value by combining high1end functionality with low cost1 of1 ownership and fast implementations. >ith powerful and adaptable solutions built entirely on the 4icrosoft )JA )erver stack! Prophix streamlines budgeting! planning! reporting! consolidation! and more.

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rights reserved. Prophix and the Prophix logo are registered trademarks of Prophix )oftware $nc. in &anada and other countries. Co part of this document may be reproduced! retransmitted! or amended without the express written consent of Prophix )oftware $nc. 4icrosoft! >indows! )harePoint! )JA )erver! Access! >ord! and Excel are trademarks or registered trademarks of 4icrosoft &orporation. All other prod1 uct and service names mentioned are the trademarks of their respective companies.