As businesses grow, it is often inevitable that additional entities will be needed. Typically these will arise from international expansion into new markets or for legal and risk mitigation.
Accounting for multi-entity operations requires a lot of stitching together of the various entities’ Profit and Loss and Balance Sheet information. This can be especially tricky if multiple currencies are involved.
Consolidation can be a full-time job or a nasty recurring chore for someone in Finance, possibly handled in an Excel Circle of Hell replete with manual transposition risk and outdated reporting options. The usability of the outputs can be less relevant with this approach than the sheer effort to piece together the data each and every month.
Consolidation should be:
- Regular – stakeholders should see regular, up to date and accurate information for decision-making.
- Achievable – if consolidated accounting was less time intensive, it would be both cost effective and a win-win for preparer and consumer.
- Scalable – as entities or currencies are added, they should be able to be easily folded into the existing Reporting framework.
Fast creation of advanced consolidated reports
Spotlight Reporting was developed to not only provide faster creation of advanced management reports – great for the CFO, CEO Board and/or Advisor – but to present beautiful, understandable outputs. For those needing consolidation functionality, Spotlight Reporting offers ease of use, speed and clarity.
Spotlight Reporting allows you to consolidate up to 50 of related entities – unparalleled functionality in the small and medium-sized business sector. Our seamless imports from Xero, MYOB and QuickBooks products (both cloud and desktop) allow you to get entity data quickly and effectively. With over 50 currencies available in Spotlight, most international operations are covered.
Spotlight Reporting also facilitates:
- Eliminations of intercompany transactions
- Categorisation of organisations in a group
- Filtered reports by group organisation
Eliminations of intercompany transactions are a necessary step in many consolidated reporting processes. Spotlight Reporting can handle these too, automatically eliminating but also allowing you to create additional elimination debits and credits transparently and easily.
Aggregation and benchmarking
Aggregation and benchmarking does not have to be a costly, slow and manual process. It should be useful, efficient and transparent.
We have a specialist product called Spotlight Multi that can handle aggregation and benchmarking for up to five hundred entities. Spotlight Multi facilitates:
- Effective, clear reporting at head office, franchisor or accountant/CFO level
- Shareable, understandable reports for franchisees,branches or individual entities
- Specific, actionable benchmarking, exception reporting and rankings across various KPI’s
- Cross-border multi-currency conversion
- Narrative observations, highlights and recommendations for open dialogue on performance improvement.
These are just a few highlights that Spotlight Multi can help franchisors and their franchisees with. To see how our franchise clients benefit from Multi, please view our case study from The Cheesecake Shop, a large franchise organisation with 200+ shops across Australia and New Zealand.
This chapter was extracted from the "Consolidations in the Cloud" white paper written by Richard Francis, CA, CEO of Spotlight Reporting. You can download a full version of this free white paper here.