Supports a 4-4-5 calendar

Description

The 4-4-5 calendar (also known as the 13-period fiscal year or retail calendar) is often used in financial planning. This calendar divides the year into 4 weeks, 4 weeks, and 5 weeks periods. It allows for a sharper, more accurate comparison of financial performance by eliminating weekends from the equation. CPM software that supports a 4-4-5 calendar is used by retailers and manufacturing companies looking for a reliable way to plan and compare prior periods.

Example Use Case

Scenario: A global retail company has stores across various regions around the world. The company wants to compare the sales performance between different stores for a particular period. However, traditional calendar systems do not provide a fair comparison due to varying weekends and holidays.

Solution: A CPM system supporting a 4-4-5 calendar can swiftly address this issue. This time granularity system ensures a uniform 13 periods of four weeks each, making it easier for the company to compare the performance between stores on an equal footing, regardless of location and local holidays.

Considerations

In CPM systems, 4-4-5 calendars (or any other calendar type for that matter) are often handed in a dimension called “Period” or “Time” where specific dates roll up to these 13 periods. In order to make this work the CPM system must allow for the customization of time dimensions to define months as either 4 or 5 weeks long, in accordance with the 4-4-5 structure.

One done, the system must allow each quarter to include two 4-week months followed by one 5-week month, totaling 13 weeks per quarter.

And lastly, adjustments must be made for the year by accounting for the extra day (or two in leap years) that does not fit into the 364-day structure by adjusting the fourth quarter.

The lower cost systems on the market will struggle to do this in large part due to their lack of dimensionality. Expect to pay more for the software and implementation when building out these calendars. Also expect to have an alternate reporting calendar should you need to report according to specific accounting rules.

Questions to ask a Vendor

• Switching Capabilities: In case needed, can the system easily switch between a standard calendar and a 4-4-5 calendar?
• Implementation: Will implementing this calendar make implementation more challenging? If so, why?
• Data Import: Will our data need to be formatted in a certain way to make this calendar type work well?