Finance Transformation is a set of offerings that assist finance executives with assessing their finance strategy and vision, and helps design and implement change to their finance organization, process and systems to improve the overall value of finance.
Finance Data Warehouse
Finance organizations are under pressure to adapt to a changing business environment. Technological advances are creating opportunities to improve service levels and reduce costs, but are also creating an environment of constant change and adjustment. At vertiv, we assist CFOs in the following areas:
Financial Strategy -
focuses on the impact of financial and operational drivers on shareholder value, thus helping companies manage their assets and better allocate capital to those initiatives that will create most value.
Performance Management -
enables internal users of financial and operational information to extract new, relevant, and timely insight from corporate financial and operational systems.
Transaction Processing -
transform financial processes across an organization to improve efficiency and service levels.
Organizations that lack sufficient time for value-added activities often exhibit signs such as requiring more than five days to close the books, using a spreadsheet-based financial consolidation process, needing many manual journal entries or other manual activities to close the books, lack of capacity to analyze business drivers and identify root causes, and a current or recent merger, acquisition, spin-off or sale. vertiv's Finance Process Optimization and Integration Suite can help companies shrink transaction processing costs up to 30 percent, reduce error rates by up to 90 percent and compress cycle times by up to 70 percent. With our help, our clients have been able achieve these benefits through targeted process improvement, creating shared services and outsourcing non-core transactions where appropriate.
The finance data quality challenge seems straightforward - simply cleansed finance data to make sure its standardized and correct before use, but the inherent complexity and variability of data confounds traditional approaches and technology. As a result, most cleansing operations are done by hand - a fundamentally slow, expensive, unreliable and unscalable option that may not even work. The first step when receiving new data is to make sure it's consistent and error-free. Traditional coding and tool-based approaches choke on the variability of most product data, so the process has largely remained a manual task. Sometimes information is simply missing or clearly incorrect and massive effort is required to find or validate it from external sources. The inability to identify what an item is and how it fits into a classification scheme (or taxonomy) impacts everything from spend classification to loading a MDM or data warehouse. We help clients implement standardization across business unit functions in processing information, submitting local ledgers and posting closing entries in order to lower exception rates and the level of rework needed. Our Finance Process Optimization and Integration team develops a chart of accounting and reporting structures to facilitate capturing and reporting of appropriate information for all stakeholders, which enables the organization to meet management's demand for analytical information without a high level of extra effort.
Organizations that lack sufficient time for value-added activities often exhibit signs such as requiring more than five days to close the books, using a spreadsheet-based financial consolidation process, needing many manual journal entries or other manual activities to close the books, lack of capacity to analyze business drivers and identify root causes, and a current or recent merger, acquisition, spin-off or sale. vertiv's Finance Process Optimization & Integration Suite can help companies shrink transaction processing costs up to 30 percent, reduce error rates by up to 90 percent and compress cycle times by up to 70 percent. With our help, our clients have been able achieve these benefits through targeted process improvement, creating shared services and outsourcing non-core transactions where appropriate. We help clients implement standardization across business unit functions in processing information, submitting local ledgers and posting closing entries in order to lower exception rates and the level of rework needed. Our Finance Process Optimization & Integration team develops a chart of accounting and reporting structures to facilitate capturing and reporting of appropriate information for all stakeholders, which enables the organization to meet management's demand for analytical information without a high level of extra effort
vertiv's Accounting Engine provides robust capabilities to generate accounting entries for various events that occur during a trade lifecycle. The configurable nature of accounting template and accounting rules offers great flexibility to end user, thereby simplifying back office accounting operations.
Back-office accounting operations currently face following challenges:
Product and Financial office systems generate non-standardized data (different formats, product codes, accounting logic, and levels of detail).
Too many interfaces
Complex and numerous interfaces, between each front office system and the end result accounting systems.
flows Data flows contain both manual and automated processes that cause delays, errors and significant personnel and IT costs.
Lack of configurability
New products require IT integration programming that can be difficult, costly and slow to create and operate.
Difficult, intrusive, slow and costly to make appropriate changes to meet regulatory requirements.
Accounting logic is not consistent, visible or auditable end-to-end.
Accounting engine boasts of following robust features:
- Provides core general ledger accounting capabilities via web interface
- Supports Book Configuration, Accounting Entry templates, Accounting process, Adjustments and Reporting
- Core data model captures all the key entities for financial flows that manage the accounting process
- Built-in support for auto-reconciliation between transaction & finance data
- Preserve data granularity facilitating drill-down to transaction detail
- Built-in top side adjustments functionality for Management, Legal and Regulatory Adjustments
- Single or groups of business events / transactions can be accounted separately for different accounting methods, (IAS , IFRS , GAAP )
- Allows for different summarization , calendars , accounts , descriptions and journals
- Support dimensionality and granularity required for Regulatory reporting, IFRS reporting, IAS Mappings
- Create two independent sets of accounting entries (Group/Local) and Group with Local override
- Enhanced suspense account processing; Enhanced balancing, with ability to force balancing across rules at attribute level
- Supports automated reversal and replay of erroneous data
The engine provides validation on key chart segments and source attributes and automatically generates next day suspense reversal if required.
- Valid GL date, future or open period
- Reference dates in open or future period
- Valid Balance Type
- Valid Journal Category
- Valid GL Transfer status
- Valid GL Transfer Date
- Valid Journal Entry Status
- Valid Journal Entry Type Code
- Unique line number
- Valid account code
- Active account code
- Enabled account code
- Not a summary account code
- STAT lines have no other currency
Accounting engine offers a central, enterprise wide accounting solution to captures the business events in real-time or in batch mode. Its Event based accounting for transactions and Robust rule builder ensures consistency in accounting rules and policy enforcement. Accounting Engine indeed is an ideal tool for back office accounting operations.
vertiv's Reconciliation Engine offers capabilities of automating the reconciliation process between multiple data sets (e.g. finance-risk reconciliation). It has facility to auto-match, auto-pair-off, auto-net, recycle error rows, and maintain logs & reconciliation history.
Reconciliation Engine offers following features:
- Capabilities of reconciling sources at different level of granularity/hierarchy
- Capabilities of automating the reconciliation process between multiple data sets (e.g. finance-risk reconciliation)
- Reconcile Journals & Balances Posted to all Ledgers (Local, Global & Trade)
- Designed using a commom rules framework and a web based application interface
- All source definitions and reconciliation rules are effective dated
- Built-in reporting module which provides a web-based display of any reconciled and non-reconciled items
- Facility to auto-match, auto-pair-off, auto-net, recycle error rows, and maintain logs & reconciliation history
- Facility to drill down from aggregated results to trade level data
vertiv's Reconciliation Engine streamlines and simplifies reconciliation process. Configurable approach of reconciliation rule coupled with advanced capabilities of effective dating and drill down makes reconciliation engine a powerful tool for back office operations.
Funds transfer pricing
It is critical for any financial institution to understand the rewards earned for given levels of risk taken. It is also critical to understand the relative contribution made by each business unit, by each product and by each customer relationship. Funds transfer pricing allows a cost of funds (assets) or value of funds (liabilities) to be assigned to every transaction making up the balance sheet. It decomposes the interest margin into a credit spread, a funding spread and a rate risk spread. From an ALM or risk management perspective, simulating the components of future margins under different economic and rate scenarios helps the funding centre(s) determine hedging strategies and the business units/product managers to remove the movement of market rates from their income forecasts. From a profitability/performance measurement perspective, vertiv provides sophisticated solutions that determine the cost and value of funds on an economic basis, reflecting market rates, liquidity premiums, credit ratings, prepayment behaviour and the underlying cash flow characteristics of a transaction.
Allocation Manager allows firms to identify cost bottlenecks, rework and nonvalue added activity. It helps reveal cost accumulation thereby enabling managers get a more accurate reflection of true cost and profit by managing how shared service costs get allocated to products, customers, channels and services and create more accurate budgets and workforce plans.
Allocation Manager is designed to operate for high volume processing in a dynamically changing rule environment.
- Data Integration/Publishing from/to various sources (xls, csv, Fixed Length, xml, database)
- Robust Allocation Rule Manger
- Supports Prorated, Fixed Value and Percent based allocations
- Web based, user interactive, drag drop interface
- Metadata management for traceability
- Effective dated rules for dynamically changing rule environment
- See how cost accumulates
- Manage shared service cost allocations
- Improve processes by identifying activities that don't add value
- Learn how and why unexpected events impact budgets
- Evolve how you do business
Allocation Manager is designed to meet the organization needs of dimensional profitability analysis thereby allowing you to calculate and report profitability contributions to business segments. Its helps you prepare for capacity costing, what-if analysis for resource planning, as well as activity based budgeting. With increasing market pressure on the banking sector, vertiv Allocation Manager can definitely be the answer to the challenge of streamlining the costprofit distribution across the organization.
vertiv's Financial Consolidation offering is part of a proven, Finance Control Management solution that includes applications for strategic management, planning and budgeting, forecasting, financial reporting and Business Specific Analytic. vertiv's financial consolidation capabilities and cash management software supports:
Simplified Data Integration
use vertiv's industry-standard technology to simplify data collection and movement from multiple charts of accounts, general ledgers, and ERP systems.
monitor participation, ensure compliance, and avoid bottlenecks that can slow the planning and budgeting process.
Built-in Calculations and Financial Intelligence
eliminate the potential for errors and reduce time spent on repetitive manual processes with vertiv's multicurrency capabilities, automated calculations and adjustments, and other features that address accounting and regulatory issues.
Flexible Business Modeling
modify the central application settings and let the system replicate those changes at all levels of the application to accommodate mergers, acquisitions, reorganizations, and other changes.
receive instant access to all important business indicators to better understand the true nature of organizational performance.
Asset Liability Management (ALM)
Asset Liability Management (ALM) is the process of ensuring a bank or credit union remains financially viable through adequate capital, stable earnings, and sufficient liquidity. ALM compares the re-pricing characteristics of assets and liabilities in the context of the entire balance sheet. Included in this analysis is the amount each rate will change. As an ALM advisor, vertiv ALM solutions were designed to promote the financial stability of banks and credit unions. We provide reports that value Asset and Liability Management in financial institutions.
ALM is used to monitor financial institution's risk and provide board members with valuable information on the financial institution's market position. ALM is an important tool for proper bank financial management. To have an effective ALM policy, a financial institution must determine their:
- Acceptable levels of risk
- Change of income
- Change of equity
- Necessary actions to take to help them achieve their goals.
Our ALM solutions provide bank and credit union professionals with the information necessary to make the most informed decisions and add income to their financial institution's bottom line.
- Our ALM reports surpass all regulatory requirements.
- We provide quarterly or monthly ALM reports and meetings.
- Our ALM reports are formatted for all levels of management and are a beneficial tool for modelling the financial institution in many different interest rate scenarios.
Outside the U.S., International Financial Reporting Standards (IFRS) have gained increasing prominence and are replacing the national GAAPs of many countries, including Australia, Canada and Japan; IFRS has been required for countries in the European Union since 2006. More than 100 nations have now adopted IFRS, although some continue to have elements of their own national GAAP in reporting standards. IFRS are set by the International Accounting Standards Board (IASB), which is the standard-setting body of the International Accounting Standards Committee Foundation (IASC Foundation). Just as the FASB incorporates the rules of former standards-settings bodies, IFRS includes the International Accounting Standards (IAS) that were issued by the International Accounting Standards Committee (IASC) from 1973 to 2000.
There has been much debate in the accounting profession of "principles-based" versus "rules-based" accounting. Principles-based systems offer broader guidelines in accounting treatment, within which accountants exercise their best judgment; rules-based systems are more prescriptive and specific. IFRS are considered more principles-based than U.S. GAAP, although there are certainly many specific rules included in IFRS as well (and some observers think they are trending in the rules-based direction).
To some extent, the different emphases reflect the differing business and legal cultures between U.S. and much of the world, notably Europe. There is concern that a principles-based system will simply give U.S. managers more freedom to tilt the numbers in their favor. Others argue that the rules-based system is overly complex and that it hasn't prevented U.S. corporate scandals.
The argument may eventually be moot, as the U.S. moves toward joining the world in adopting IFRS standards; the SEC has already issued a "road map" to that end. Nevertheless, IFRS adoption is hardly a done deal. And as has happened in other countries, the U.S., in adopting IFRS, may seek to retain various elements of U.S. GAAP.
It's a conundrum: uniform IFRS adoption worldwide would certainly make it easier to compare the financials of companies in different countries. On the other hand, national GAAPs were developed within the prevailing business, legal and social environments of each country. On both political and practical levels, it's difficult to eliminate all such individuality and some wonder if it is even desirable.
Budgeting, Planning and Forecasting
vertiv Budgeting, Planning and Forecasting is a comprehensive solution that drives Finance processes as well as a wide range of operational planning processes, from a single repository of accurate information throughout the enterprise. Powerful workflow functionality empowers users to track and communicate the progress of their plans and budgets, supported by the use of email notifications and alerts. Flexible rolling forecasts, using real-time information, provide greater visibility into future operating performance.
- Highly sophisticated modeling capabilities allow you to create, analyze, and assess business rules and what-if scenarios within your planning process to help drive your strategic goals.
- An innovative, highly scalable and secure technology architecture supports tens to thousands of users throughout an organization with filely no impact on software performance.
- All data, business rules, and key drivers are integrated into a single repository of accurate information that can be accessed easily by all employees involved in the process.
- Finance employees can shift their focus from data collection to meaningful data analysis.
- A single repository of financial truth gives users a unified, consistent view of plans, budgets, and forecasts, empowering debates on business decisions rather than data accuracy.
vertiv's solution tracks business plans, budgets, and forecasts to strategic objectives, operational goals, and targets. Our modeling engine, inherent in our technology platform, enables essential data to be calculated in limitless business scenarios.
Insurance Straight Through Processing
The Insurance industry is competitive, cyclical and (by definition) exposed to every possible risk. These risks can often be long-term and hard to define, leading to challenges around pricing and reserving. The industry needs capital to ensure it can meet its obligations but exactly how much capital is dependent on changing regulatory and reporting requirements.
vertiv enables you to build stronger, more profitable customer relationships by providing a single view of your policyholders so you can efficiently and cost-effectively deliver services that meet their needs. Real-time analytics help you make timely and relevant offers, regardless of the channel, while integration of your front-office and back-office processes into a comprehensive system delivers the ROI you need to succeed.