Balance Sheet, Cash Flow, and Income Statements are produced during budgeting

Description

This functionality enables organizations to generate a complete three statement model when budgeting and forecasting. This means that all inputs in the system, both in the form of actuals and future-looking data, contribute to a Balance Sheet, Statement of Cash Flow, and Income Statement.

Example Use Case

Scenario: A large manufacturing company uses Excel for its annual budgeting process. Their investors require all three financial statements when reviewing the annual budget. Doing this in Excel is hard to maintain and complete in a timely manner.

Solution: With a CPM solution that facilitates the generation of balance sheets, cash flow, and income statements during budgeting, the company can accurately track assets, liabilities, and shareholders' equity. All three financial statements are produced in formats mandated by the investors.

Considerations

This requirement might sound obvious, however in the CPM world we see many products that only offer a P&L. This is because most businesses budget and forecast to that, not the balance sheet. If this is important to you, make sure the vendor will be providing all three statements on day one, out of the box.

There may eventually be a need to produce alternative views of your financial statements, such as GAAP and Non-GAAP, pro-formas, and so on. Make sure the financial statements are not rigid templates and can be modified or cloned, then modified.

Questions to Ask a Vendor

• Automation Capabilities: How does your system automate the generation of balance sheet, income, and cash flow statements during the budgeting process?
• Reporting Formats: Are we able to have multiple alternate types of financial statements, like GAAP and Non-GAAP?
• Formatting: How flexible is the system with formatting? Will we have to export into Excel to get the look we need?