Increased scrutiny of the expensive cost of higher education has administrators asking tough questions. Answering those questions requires quality data and the analytic tools to access answers to this information. Hyperion Financial Management (HFM) can be a smart choice for colleges and universities for many of the same reasons commercial companies use financial close and consolidation solutions.
HFM has traditionally been associated with companies that require the specialized functionality to consolidate international operations. Many implementations involve complicated multi-currency consolidation of dozens of legal entities. This functionality, traditionally isolated in specialized software packages, is now an integral part of Oracle’s Enterprise Performance Measurement (EPM or Hyperion) suite of tools.
HFM enables improvements in a number of key areas. HFM’s functionality and structural independence from the general ledger (GL) allows:
- Consolidation of multiple sets of books or funds across separate general ledger systems
- Normalization of multiple charts of accounts (e.g., medical school combined with traditional university)
- Currency translation for foreign campuses or institutions
- Incorporation of data kept off-line (e.g., third-party endowment data)
- A separate security structure geared toward reporting rather than transaction processing
- Automated elimination of transactions at the institution or fund level
- Improved efficiency of the financial close through systemic processes and a closing calendar that extends beyond the general ledger
- Preparation of cash flow statement and supporting schedules like roll-forwards
- The collection of additional information during the close through data forms to support footnote disclosure requirements
- Allocations can be run after all data is collected within a single system
The HFM – EPM combination provides a number of benefits such as:
- Smart View integration with Microsoft’s Office products provides world class end user capabilities
- Shared metadata and statistical metrics create an integrated financial analysis environment
- Extended analytics provides an out-of-the-box star schema for financial reporting
- Reporting and analysis tools provide a platform for analytic rather than transaction-oriented reporting
These tools can help mitigate risk by:
- Enabling a more efficient transition from one GL package to another. Prior to the transactional system changeover, certain activities could be migrated onto HFM such as reporting, close management, etc. This would reduce the effort, timeline, and risk associated with the transaction system cutover.
- Shared metadata between analytic applications (HFM, Hyperion Strategic Finance or HSF, and Hyperion Planning) is more likely to achieve a single version of the truth
- Facilitates more robust ad-hoc analysis by enabling leadership to research emerging issues and more confidently respond in an timely way
The HFM – EPM combination is being successfully deployed in non-traditional situations to solve a variety of administrative challenges. The Higher Education market is one of those non-traditional areas that could extend EPM environments and gain these benefits.
Author: Ron Woodlock, Performance Architects