The last mile of finance – Are we nearly there yet?

While most organisations use automated systems and processes to manage their daily business transactions and some have developed business intelligence platforms or corporate performance management (CPM) applications for management reporting, few have automated processes and systems in place to shepherd them though "the last mile” of the financial reporting process.

A typical last mile process will involve numerous stages of data extraction, analysis, reformatting and rekeying and will involve data being handed off from one department to another. These processes and specifically, their handover points, often represent areas where key data may be lost or corrupted through lack of documentation or poor communication.

iXBRL – Just a part of the solution

Inline Extensible Business Reporting language has gained more prominence over the last decade as a way of resolving the challenges posed by the need for organisations to exchange information sets of standard taxonomies. Put simply, iXBRL allows organisations with differing internal representations of corporate indicators to exchange information using a common business reporting language. This in itself does little to address the real problems that lie at the heart of the disclosure process, and in many cases it merely adds an extra layer of technical complexity to an already broken process.

Transforming the last mile from an obstacle course into a downhill sprint!

CDM applications offer many benefits to those organisations that adopt them. They allow financial data to be stored centrally and enable users to make use of their existing productivity tools in a more robust and controlled environment. They provide detailed workflow management and the application of authorisation controls to ensure that reported numbers are correct and have been approved prior to their release.

Moreover, the implementation of an enterprise-wide CDM platform also ensures that the steps in each disclosure process are well defined and have been assigned to the appropriate resources internally. In this way they make each part of the last mile more sustainable, repeatable and predictable.

In summary CDM applications will provide:

  • a centralised database
  • an Integrated technology platform
  • the capability of leveraging Word and Excel
  • a full audit trail
  • iXBRL dragging and tagging
  • workflow and version control of every report

While streamlining disclosure processes and adopting an integrated CDM platform may never make the last mile of finance an easy path to negotiate, organisations that do so should be able to transform what has traditionally been an obstacle course into a down-hill sprint.