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Get a consolidated view of your business.

Mastering multi-entity management and financial consolidation.

• Learn how to master multi-entity management and financial consolidation in a global economy.

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Mastering multi-entity management and financial consolidation in a global economy.

Why a single, consolidated view of company finances is such an elusive goal for growing software companies.

Software, SaaS and cloud computing companies face multi-entity and global business management challenges far earlier than most other types of firms. Without financial applications designed for multi-entity management, the monthly close, consolidation and reporting processes are time-consuming and error ridden. Finance staff are forced to use spreadsheets or add-on reporting software to accomplish these monthly tasks, both of which reduce productivity, increase costs and lead to errors. And as software companies grow, so does the complexity and effort. The more offices they add, the more regions they expand into and the more business entities they encompass the harder it becomes to consolidate financial information and get a single consolidated view of the truth.

It's not uncommon for a relatively small US-based software company to have a development center like India or China, customer support offices in Ireland or Asia, and Sales offices in multiple locations. Each location usually operates as a separate business entity subject to different currency, tax and reporting requirements. TO further complicate matters, software companies that grow through mergers and acquisitions may find that they have acquired different financial systems as well.

The true cost of consolidating, reporting and analyzing financial and operational information across multiple business entities.

When spreadsheets and add-on reporting solutions are used in conjunction with traditional financial management systems, it's almost impossible to automate financial consolidation, reporting and analysis processes. Data from multiple entities must be manually collected and consolidated. Currently conversions must be calculated and inter-entity adjustments and eliminations must be performed. This leads to:

• Increased Finance Staffing Costs: It takes a lot of time to gather and consolidate data in spreadsheets from multiple business entities and financials systems, to calculate currency conversions and perform inter-entity adjustments and eliminations and to correct inevitable errors – especially when updates must be made manually and data is often duplicated. When full-time employees cost the company $120,000/year, all of this extra work adds up quickly.
• Longer Financial Close Processes: All of the hours and days spent collecting and consolidating financial data increase the time needed to perform period-end financial closes. The only way to accelerate this time-consuming process is to add finance staff – and overhead.
• No Real-Time Business Visibility or Consolidated View of Your Business: Traditional financial management solutions can't deliver the real-time visibility software company decision-makers need – especially those in multi-entity companies. They can’t get a consolidated, real-time view of the business with the ability to drill down to supporting transactional level details. They can't compare performance across regions, which leads to sub-optimal, untimely business decisions. Even worse, they may have different versions of key reports, causing confusion and management misalignment.
• Increased IT Costs for Add-on Financial Consolidation Solutions: Companies looking for accounting workarounds may invest in add-on financial consolidation solutions. The problem is that their IT costs and complexity also increase – and they still won't get the real-time global and local visibility they need.

Timeline: A growing consolidation nightmare.

• 2005 – A software company is founded in San Francisco, CA, USA.
• Employees: 30
• Currency: US$
• 1 Staff Accountant is required.
• Company closes the books on a quarterly basis.
• 2006 – An Engineering office is added in Bangalore. Growth =40%.
• Bangalore Employees: 4
• Currency added: Rupee
• A separate foreign business entity is created to support the new office.
• Days required to manually collect and consolidate data: 14. Additional days to close the books: 5. Days to period-end close: 19.
• 2007 – Sales offices are opened in the UK, Canada and Beijing.
• International employees added: 38
• Currencies added: CAD$ and Yuan
• More foreign business entities need to be established, and the company must now support revenue transactions in foreign currencies, currency translation, foreign exchange gain/loss accounting, local reporting and more complex financial consolidation. Management is now at risk of losing operational visibility into the business.
• 2 additional staff accountants are needed at Headquarters at $120,000 each along with the addition of local accounting support in each country.
• Days to period-end close: 30 days.
• 2008 – A small competitor is acquired.
• Dallas Employees – 24
• Currency: US$
• A smaller competitor is acquired, adding 24 employees and 1 new accounting system. The company now needs to consolidate across different accounting systems.
• Days to period-end close: 34 days.
• 2009 – Irregularities discovered.
• Auditors discover irregularities in spreadsheets which introduces financial restatement risk. Increased auditing requirements increases costs by $20,000.
• 2010 – CFO comes under fire.
• The company’s CFO comes under fire from the CEO for lack of real-time business visibility, lengthy close cycles and rising departmental expenses.

Today there are more than 60,000 multinational companies, and while the number continues to grow, their average size is falling.* Find out how all of them can simplify financial consolidation in the next section.

*Source: "How startups go global," Michael V. Copeland, Business 2.0 magazine, June 29, 2006.

Click, consolidate and regain command of your multi-entity software business via the cloud.

Cloud-based financial management solutions are ideal for multi-entity software companies. Why? Because there are no barriers to real-time, on-demand financial visibility. Everyone has access to the same, consolidated data. What’s more inter-entity eliminations and currency translations can be automated. Ideally you would be able to:

• Efficiently handle the management of your complex, multi-entity business.
• Intacct provides robust support for:
• Multiple business entities with unique business structures
• Local vs. corporate currencies, taxes and reporting requirements
• Automated inter-entity transactions
• Minority interests and partial ownership situations
• Multiple charts of account
• User the currencies you need – and ensure FAS-52 compliance.
• Intacct allows you to:
• Operate each entity in its own base currency
• Use an unlimited amount of transactional and reporting currencies
• Automatically leverage real-time exchange rates and perform currency translations in real time
• Easily calculate unrealized currency gains and losses and ensure that your financial reporting is up-to-date and accurate
• Track both gains and losses from currency translations over time with Cumulative Translation Adjustments to ensure FAS-52 compliance
• Automate the consolidation process and get a clear, comprehensive audit trail.
• With one click, Intacct allows you to:
• Consolidate financials from all of your business entities
• Automate inter-entity eliminations to keep each entity in balance
• Maintain a comprehensive audit trail including day, time, user and currency rates
• Get end-to-end real-time visibility across your entire business.
• Intacct gives you:
• A graphical view of your organization’s structure – no matter how complex
• Real-time, consolidated reports and key performance indicators (KPIs) to keep your finger on the pulse of your business
• Ability to do side-by-side performance comparison on both financial and operational KPIs
• A live drill-down from consolidated corporate data to local business entity data to examine transactions in detail

"Intacct has dramatically reduced the time we spend on our financial processes across the board, including consolidations and revenue recognition." – Corporate Controller, nCircle

Intacct benefits for CFOs and Controllers.

1. Anytime, anywhere access to real-time information via the cloud
1. Ensures data consistency
2. Improves management alignment
3. Allows 24x7 access from any web browser
2. Automated finance workflows
1. Increases finance productivity, lowers overhead
2. Eliminates spreadsheet maintenance, data entry and data duplication
3. Accelerates period-end close processes with one-click consolidation
4. Reduces the need to hire additional staff @ 120k/year
3. Real-time multi-dimensional analysis
1. Improves decision-making
2. Enables business analysis along different dimensions – by business entity, region, country, product or currency
4. Comprehensive audit trails
1. Simplifies the auditing process
2. Gives auditors what they need faster, reducing audit costs by $200/hour
3. Enables tight control over finances and post-consolidation adjustments if necessary

The net worth.

Multi-entity software, SaaS and cloud computing companies juggle an increasing amount of complexity resulting from varying business structures, multiple currency requirements, as well as local tax and reporting requirements. Consolidating information across multiple entities – which usually involves manually collecting and consolidating data in spreadsheets and making any necessary currency and inter-entity adjustments – results in lower finance productivity, higher costs, slower financial close times and poor business visibility.

As the only clod-based financial management solution designed for software companies, Intacct has been proven to outperform traditional financial management and accounting solutions due to its cloud-based delivery and extreme flexibility. More than 3300 businesses with more than 15,000 business entities are enjoying faster closes and better reporting and analysis with Intacct. Financial consolidation happens in real time with one click. And stakeholders get one, cohesive view of the business, which increases management alignment and improves financial reporting and operational decision-making.

"It used to take us as much as two days to put together our company-wide financial reports. With Intacct Global Consolidations we can run a consolidation and have our reports available in a matter of minutes. This frees up my time to focus on managing our finances and helps our executive team to analyze the results faster to improve decision making." –Revenue Manager, Vovici

Additional Resources:

• Intacct Global Consolidations Web Page
• Customer brief: Voltage Security
• Intacct Global Consolidations Datasheet

About CFO Insights

CFO Insights is a leading online resource delivering all the information savvy finance professionals in software, SaaS and cloud computing companies need to know. Get insight into how software CFOs like you are overcoming today’s toughest financial management challenges.

Streamline your quote-to-cash process

Save time and money now. Leverage cloud computing-based CRM and Financial Management systems to connect Sales and Finance.

Every year, software, SaaS, and cloud computing businesses lose millions because their financial systems aren't integrated with their CRM applications. Finance organizations have to manually re-enter and verify customer, order and pricing information already captured by sales in the CRM system—which costs you dearly in terms of lost productivity, data entry errors, revenue leakage, and downstream invoice dispute resolution. Additionally, since Sales doesn't have access to information in the finance system, you waste time with one-off responses to Sales inquiries about invoice, payment and collections status.

Fortunately, there's a solution to address these challenges, streamline quote-to-cash and connect Sales and Finance: Intacct. This unique financial management and accounting system seamlessly connects to leading CRM systems like salesforce.com.

The true cost of Sales and Finance silos.

When sales and finance data exist in disconnected silos:

1. Sales and finance may end up using different SKUs and pricing, leading to inaccurate orders, fulfillment and invoicing.

2. Inaccurate or inconsistent customer contact information creates order booking and invoicing problems.

3. Sales must manually prepare contracts, reducing their productivity.

4. Contracts may include non-standard or incomplete terms, leading to inaccurate orders, invoices and revenue leakage.

5. Manually re-entering order information into a financial system reduces productivity and introduces errors that can complicate downstream fulfillment, invoicing and collections.

6. Limited visibility into renewal opportunities prior to the actual renewal date reduces upsell opportunities and impacts customer retention.

7. Customer contact information in the CRM system may not match the information in the financial system, leading to duplicate customer accounts and an incomplete view of the customer relationship.

8. Finance must manually create invoices, which can delay billing—especially in recurring or renewal situations—increasing errors, and reducing productivity.

9. Without any visibility into billing and collections data, salespeople continue to take orders from delinquent customers, adding bad debt to the balance sheet.

10. Finance must deliver order, invoice and payment status updates to Sales via email or phone, increasing the burden on finance and taking time away from strategic initiatives.

11. Invoice errors increase customer frustration and delay collections.

12. Calculating revenue recognition manually means entering data into complex spreadsheets, which introduces errors, reduces productivity, complicates revenue forecasting and makes restatements more likely.

Streamlined Quote-to-Cash with Intacct

When sales and finance systems and data are tightly integrated:

1. Information is automatically synchronized so sales and finance have end-to-end visibility for a complete, consistent, real time view of the customer.

2. Automated order management, billing, revenue recognition, and renewals ensure accuracy while boosting productivity.

3. Sales has real-time access to customer data, order data and renewal opportunities; Finance spends less time supporting sales requests.

4. Increased accuracy and timeliness reduces errors, eliminates revenue leakage and increases customer satisfaction.

5. Revenue recognition is automated, eliminating complex spreadsheets and delivering real-time visibility into recognized and deferred revenue.

Protect your CRM investment while bringing sales and finance closer together.

You don't have to rip out and replace your CRM system to get the benefits of a seamless, streamlined quote-to-cash process. In the next section, we'll examine how deploying Intacct together with Salesforce CRM satisfies sales and finance, without sacrificing your CRM investment.

Keep the CRM system Sales loves and reduce your risk.

With Intacct, you get the benefits you want, faster.

The last thing successful companies need is to upset the sales process. When Salesforce or any other leading CRM system is deeply entrenched in a sales organization, the easiest—and best—way to streamline the quote-to-cash process is to find a best-of-breed financial management and accounting solution that works with it. Fortunately, Intacct makes this easy, allowing salespeople to continue using the tools they know and love—and keep their focus on growing the business. But Sales isn't the only team with skin in the game. What about Finance? In many cases, the finance team is either stretching the limits of a solution like Quickbooks, or looking for a financial system designed for the needs of software, SaaS and cloud computing companies, not generic financial applications from Microsoft, Sage, Lawson or Oracle. Intacct satisfies Sales and Finance by enabling several key benefits for software, SaaS and cloud computing companies:

1. Increased productivity and accuracy through automation Customer Testimonials:

“We're able to more quickly create the reports management needs to make important business decisions. Instead of exporting data and fumbling around in spreadsheets, we simply press a button to run the report we need.”—Controller, Acceller

“With Intacct we save dozens of hours a month, which used to be spent integrating financial information from each branch.”—Senior Vice President, Check Advance, Inc.

“The improvement Intacct offers us in visibility and automation makes it possible for us to improve the way we run the entire company; but they also improve our efficiency. We believe we'll be able to grow much larger with the same finance staff we have in place and avoid hiring two to three full time people over the next 18 to 24 months, so the hard dollar ROI is very compelling.”—Vice President Finance, OpSource

2. Reduced revenue leakage. Customer Testimonials:

“Intacct impressed us with its ability to efficiently track our recurring revenues and manage deferred revenues from maintenance and service contracts. Intacct offers a broad financial solution set that provides flexible, on-the-fly financial reporting and dashboards that will improve visibility into our financials.”—nCircle

“Intacct is a robust financial management system with all the modules we need, including advanced revenue recognition.”—VP of Finance, JasperSoft

3. Faster period-end closing. Customer Testimonials:

“It used to take us as much as two days to put together our company-wide financial reports. With Intacct Global Consolidations we can run a consolidation and have our reports available in a matter of minutes. This frees up my time to focus on managing our finances and helps our executive team to analyze the results faster to improve decision making.”—Vovici

“Intacct provides all the functionality a growing company like OpSource needs to efficiently manage our global financials. Our close and consolidation process across our four entities now takes only days versus weeks.”—CFO, OpSource

4. Lower cost and risk of integration. Customer Testimonials:

“The integration between Intacct and Salesforce CRM has really helped our company with accurate reporting and providing greater visibility and communication between our various departments in the company. As the Staff Accountant handling all the AR functions, the quick and easy transfer of information from Salesforce CRM to Intacct and back really makes my job easier.”—Big Machines

“We have been using Intacct MAX for Salesforce CRM for two years and it is working extremely well for us. Having an integrated lead-to-cash process has eliminated the time-consuming manual data-entry, lack of visibility and insufficient reporting capabilities of our previous accounting application.”—Controller, decipher

5. Better reporting and visibility. Customer Testimonials:

“Intacct has enabled immediate updates of information that previously would have taken days to access. As a result, we are making business decisions more quickly and accurately than ever before.”—Senior Vice President, Check Advance, Inc.

The net worth.

Software, SaaS and cloud computing companies that already enjoy the accessibility, security, affordability, robustness and flexibility of cloud computing-based business applications like Salesforce CRM will be happy to know that they can streamline their quote-to-cash processes with Intacct's equally agile, cloud-based financial management and accounting applications. By deploying Intacct and Salesforce CRM together, CFOs and other finance executives gain end-to-end real-time visibility of their companies' financial outlooks. Intacct also increases productivity, reduces costs, helps close the books faster and dries up revenue leakage—all through automation. Learn more.

Get the ROI facts. Read more than 50+ reviews on salesforce.com's AppExchange.

Additional Resources on the Web:

“Faster Quote to Cash, Speedier Customer Response, More Informed Decision Making.”—an IDTech White Paper