Accounts from the ledger can easily be grouped and planned as one account in the planning system

Description

This feature allows users to consolidate different accounts from the ledger, view them as one account within the planning system, and enter values at that summarized level.

Example Use Case

Scenario: A services company uses CPM software for its financial planning. The firm has multiple revenue streams, each associated with different ledger accounts. However, for strategic decisions, the finance team needs to view and plan some of these accounts as one unified account.

Solution: The CPM software groups these revenue accounts as one account in the planning system. This feature enables the team to plan on a summarized revenue level for multiple accounts simultaneously, making forecasting, budgeting, and summarization processes faster.

Considerations

When planning at a summarized level, most systems will still populate the accounts below it, breaking the value up evenly across them. This is because planning tools usually must have some data in accounts for certain calculations to work as they do not look at the summarized values. Same goes for reports.

That said, this feature is still very useful. What if you wanted to spin up a quick expenses budget and had 15 different travel accounts for flight, hotel, per diem and so on? Just lump those together for the quick model.

Questions to Ask a Vendor

• Grouping Capabilities: Is grouping accounts as easy as collapsing them with a button, or does it require some other type of setup?
• Impact on Underlying Data: Does the grouping of ledger accounts affect the integrity or consistency of the underlying ledger data?