Income Statement planning is included for multiple entities

Description

Multi-entity income statement planning in the context of Corporate Performance Management (CPM) software allows organizations to create, manage and analyze the income statements forecast for multiple business entities under one umbrella. This feature empowers businesses to streamline their budgeting and forecasting processes, ensuring cohesion and accuracy across different departments, subsidiaries or geographic entities.

Example Use Case

Scenario: A multinational enterprise operates with various subsidiaries spread across the globe. These distinct entities each have individual income statements that need to be planned for individually and together.

Solution: With CPM software that includes multi-entity income statement planning, each subsidiary can input their own income statement budgets, and these can then be centralized, consolidated, compared, and analyzed at the corporate level. This allows for an accurate understanding of the entire corporation's anticipated financial performance on an entity-by-entity basis.

Considerations

Most, if not all products on the market will include an Income Statement by default, as most organizations plan by this statement. For this specific requirement, we're looking to see if the vendor can break the IS down by subsidiary. In reality, if it can do that, it should be able to break it down by other dimensions as well such as location, product, and so on. Consider the power of this for analysis, being able to put two Income Statements side by side for a specific entity, a like product, and look at the difference in results. Or simply comparing a product across different geographies.

You may encounter certain entities requiring a different account structure for their Income Statement. Make sure this is possible if it matters to you.

Questions to Ask a Vendor

• Entity-Specific Customization: How does your system cater to entity-specific income statement planning? Does it allow for each entity to customize to its specific needs?
• Roll-Up Capabilities: How does your system support the consolidation and analysis of multiple entities' income statement plans?
• Real-Time Data Access: Does your software offer real-time data access across all entities for immediate analysis as income statement data is entered, or do we need to wait for a batch process?