Has your team recently implemented Hyperion Financial Management (HFM), but you feel it is lacking bells and whistles you would expect with an enterprise application? Sure, the application is a great consolidation tool and it handles some incredibly complex ownership and allocation calculations with ease; but are you looking for the next big splash? Automating your statement of cash flows might be a great enhancement to consider. First, the bad news: HFM cannot automate a cash flow statement in its entirety. However, the good news is that a well-built solution can get you most of the way, which will be music in the ears of your corporate accounting team.
Including cash flow within an HFM application will be a project well worth the effort. Modifications and edits to existing metadata, rules files and member lists along with the creation of new data forms are necessary steps in developing an effective solution. Once complete, HFM will automate the process of computing the change in balances for the period. It will pull needed values from the income statement and roll-forwards as well. The solution will also accurately calculate the effect of the exchange rate on the change in cash.
What’s more, assuming you are manually creating your cash flow statement using a spreadsheet, HFM will reduce error rates as so much of the heavy lifting will be automated. To go a step further, spreadsheet-based solutions are difficult to maintain. You are most likely using dozens of worksheets that source one another and one broken link can be disastrous. In addition, employee turnover can be a troublesome when that “we can’t afford to lose you because you are the only one who knows how this works” person actually leaves the company.
This solution will also improve productivity. The cash flow process can take upwards of two weeks when done manually depending on the size of the entity and complexity of transactions. Spreadsheet-based solutions simply do not have the capacity to meet the demanding reporting requirements of today. HFM will provide for a much faster close. By accelerating reporting cycles, HFM will deliver more timely results to internal and external stakeholders. After migrating to an automated cash flow solution using HFM, a recent client reported a time savings of 55% with the anticipation of having that number climb to 75% as familiarity with the new process grows. A faster close like this for your company will – without a doubt – free up employees to spend less time on processing and more time on value-added analysis!
Author: Joseph Francis, Performance Architects