Finance Transformation

​ Month End Close Optimization

Table of Contents

​ 3 ​ 4 ​ 5

High
CFO Ongoing Performance
Challenges Struggles Keys and
Barriers

​ 6 ​ 8 ​ 10

Teradata’s
Close Improving
Vision for
Process the Close
Financial
Optimization Process
Analytics

​ 11 ​ 12 ​ 14

Prioritizing
The Customer
the
Teradata Success
Assessment
Difference Stories
Results
2
CFO Challenges ​ Doing more with less
​ Given the economic realities of
the past few years and
uncertainty about the future
economic climate, finance
continues to face pressures to
maintain and/or reduce budgets
while also providing increased
services to the business and the
broader regulatory and
investment community along with
greater transparency.
​ Make better, faster
decisions
​ The CFO is really being pulled in
two different directions. Their cost
center is not unlike IT, legal or
other shared services, meaning
they are being pressured to take
cost out of their budget and
transform finance from report
generators to a value-added
analytic provider to the business.
As a strategist and not just a
bookkeeper, they can provide
meaningful and timely insight into
corporate financial close
information for executives to
adapt to market changes and
drive accountability through clear
performance metrics.
3
Ongoing Struggles

​ A faster month-end close

​ The reality in today’s world is that many public
and private businesses must fulfill multiple
complicated financial reporting packages in
a timely, efficient manner. It’s a constant
struggle to achieve goals by aligning the close
process between reporting units and
corporate consolidated financial statements—
while balancing competing internal and
external reporting requirements.

​ Mushrooming auxiliary spreadsheets

​ T ime constraints to properly analyze and
decide how to leverage technology to
facilitate the close process by automating
time-consuming accounting activities can
lead to the mushrooming of auxiliary
spreadsheets (outside of ERP systems) being
used to produce the financial close and
related analysis.
4
High Performance
Keys and Barriers
Monthly close
best practices
Business processes are
standardized
Automation of time-
intensive processes
Business insights and
scenario-based modeling
Single version of the truth
Monthly management
report packages address
management needs
​ Learning from the
leaders
​ What is standing in
the way?
​ High performing finance
organizations exhibit a number of
​ What is driving operational
inefficiencies and frustrating
key competencies, like: efforts to meet new initiatives?
Tangled, complex silos of
•  A passion for standardization
information. Financial systems
and simplification
historically have grown up around
•  Lean cost structure with a the functional silos of finance with
greater percentage of cost multiple sources and inconsistent
dedicated to value-added data sourcing, proliferating
multipurpose-built data marts, ad
services
hoc tools and processes,
•  Speed, timeliness, and short disparate reports and metrics, and
cycle times are the norm multiple departmental decision
makers.
•  Fewer metrics with the metrics
that are used focused on the
most important areas 
•  More time spent on analysis
and commentary, evaluating
the future with more investment
in predictive and early warning
capabilities
•  Leverage technology to
improve efficiency and
flexibility, and gain insight to out
think and out execute the
competition
5
Teradata’s Vision
​ Teradata’s vision state includes all required data available from a single
source (data warehouse) with data that is reconciled to the general

for Financial
ledger (GL) and transactional systems. All analytic applications source
and return enriched data to the data warehouse with key reports and

Analytics
analysis produced from the data warehouse with common portal,
hierarchies and information delivery processes. End-to-End data
lineage and governance ensures transparency and traceability, while
governance processes also ensure data quality and consistent use.
​ Integrated analytics
​ End-to-end data transparency
​ Data governance
Next Generation Finance Infrastructure
Reporting and
Accounting Calculation/ Analytics
Financial Systems HR
Hub Modeling Engines Statutory
Consolidation HR and Applications Reporting
Operational Accounting
Rules General Ledger PR Planning Profitability Management
Systems Reporting
Sub-ledger AP Purch AR FA PA Other
Risk AML
Member Regulatory
Product Reporting
Provider
Claims
Operational
Market DATA WAREHOUSE Analytics
Call Center Tactical Info
Third Party Delivery
DATA MANAGEMENT
Manual Entry
Hierarchy Security Metadata Data Quality & Master Data Workflow Rules
Management Management Management Governance Management Management Management

6
Finance Value Chain
​ Month-End Close
Procure to Pay
• Strategic Sourcing
• Procurement
• Vendor Management
• Invoice Processing
• Exception Handling
• Help Desk Support
• P-Card Processing
• T&E Management
• 1099 Processing
• Payment Run
• Payment Reconciliation
• Report & Control
Ops Reporting/IT Close
Sub-Ledger Close
(JE’s to GL)
Time to Data
Order to Cash Record to Report Financial Planning & Analysis
• Quotes & Proposals •  GL Accounting & • Segmental Reporting
• Order Management & Reconciliations • Cost Benefit Analysis
Fulfillment •  Intercompany Accounting • Price Modeling
• Customer Master •  Fixed Asset Accounting • Business Intelligence Reporting
Maintenance •  Treasury Accounting • Management Reporting
• Billing •  Audit Support • Planning, Budgeting &
• Credit Control •  XBRL Conversion Forecasting
• Cash Application •  Tax Accounting • Financial Statement Prep &
• Collections Analysis
• Customer Help Desk • Financial Reporting
• Bank Reconciliations
Reporting Close
Consolidation
GL Close Reporting Analysis
Reconciliation.
Adjustment Cycle Time to Decision
Data Quality and Governance
Risk and Internal Controls
Technology
7
Close Process ​ For one global hardware and software company, earlier
availability to results through its data warehouse
Optimization shortens the steps in the close process:

Business unit Final

Local results to Corporate allocations
review and and
business units consolidation
feedback eliminations
THE RESULT

Global Spend less Details in the Alternative

Consistent, automated
access time warehouse hierarchies in
management reporting
simplifies reviewing reduce the the
yields $6.1 million savings local with earlier need to ask warehouse
reporting visibility the field for support
Close process reduced by requirements throughout results streamlined
eight days and prompts the month. clarification, cost center
early error simplifying allocations
Global chart of accounts identification corporate
simplified, reducing and consolidations
consolidation elements correction. resource
by 70% needs.

Number of Work Days

0….…1….…2….…3….…4….…5….…6….…7….…8….…9….…10….…11….…12….…13….…14….…

Pre-Warehouse

Post-Warehouse Earlier availability to results shortens process steps

8
Close Process ​ Below are more specifics about the global hardware
and software company’s experience with its data
Optimization warehouse and close process optimization:

Who has How

Key
been Benefits Teradata
challenges
helped helps

•  Director of Corporate •  Complex allocations •  Accelerated lower cost •  Business units use daily access to
Consolidation monthly and annual results to resolve issues prior to
•  Multiple charts of
close process month end, realizing 33 to 75%
•  Director of Financial accounts
reductions in the close cycle
Reporting •  Simplified GL reduces
•  Multiple data sources
reconciliation efforts •  Detail in GL reduced by linking
•  Chief Accounting that typically require
during close summary account balances to
Officer spreadsheets and
sub-ledgers housed in the data
manual entries for •  Improved performance
•  Corporate Controller warehouse (Aptitude Accounting
integration purposes of ERP transactional
Hub)
•  Director of Finance systems during the
Architecture monthly close process •  Reduced user traffic in the ERP
system speeds transactional
•  Director of Financial •  Enhanced visibility into
processing while analytical work is
Systems geographically
done on the data warehouse
dispersed results across
multiple business units •  Data warehouse provides common
accounting rules and hierarchies to
easily access global trends and
details from a single source

9
Improving the ​ Achieving sustainable improvement in the close-to-
report cycle requires a holistic approach that considers
Close Process factors across all business dimensions, including:

​ Assessing people ​ Assessing the process ​ Assessing technology

​ Are the resources and financial
talents of the organization high
performing?
•  Evaluate roles and
responsibilities in the
organization
•  Review the close calendar to
determine if defined milestones
support accountability
•  Evaluate workload distribution
and resource alignment
•  Determine effectiveness of
communication throughout the
organization
•  Measure performance and
rewards
​ Are financial processes
streamlined, simplified, and
standardized throughout the
cycle?
•  Determine the effectiveness of
sequenced activities, and
whether or not work is
performed away from the
close
•  Manual steps outside the
process
•  Data calculation/
manipulation outside the
system
•  Evaluate appropriate use of
estimates and materiality
thresholds
​ Are the capabilities of systems
and tools properly leveraged?
•  Identify opportunities to further
leverage technology
•  Evaluate employee technology
proficiency for the current
systems or applications
•  Determine whether or not
intensive manual activities are
automated
•  Evaluate the use of data to
appropriately meet
organization reporting needs
•  Leverage tools to track status
real-time and promote
accountability

•  Review the issue resolution

process and determine the
effectiveness of root-cause
analysis 10
Prioritizing the
Assessment Results INITIATIVE PRIORITIZATION

Product
Profitability Product
v2 General Profitability
Accounts Ledger Redesign
Payable Analytics Product
Analytics General Profitability
Ledger Redesign
Accounts
PEOPLE Tax HR Analytics
Payable Analytics? Statistics
Analytics
Deferment
Analytics
Payroll
HR Analytics
Analytics Other HR
Analytics

Payroll
CPB/GL
Analytics? and Other A/P
Cross- ?
reference Attendance Process
Analytics
PROCESS
Business Unit
Costing Tax
Apportionment
CFR
Redesign
CPB
Repository Acquisition
Analytics

TECHNOLOGY

Business Value
Fixed Assets
Analytics

Effort to Realize
11
The Teradata
Difference
​ Accelerate and lower the
cost of monthly and
annual close processes
​ Daily updated views of results
throughout the month mean
business units spend less time
reviewing and correcting results
after the books close at month
end. Customers using Teradata
have seen close cycle reductions
in time of 33-75%.
​ Simplified GL reduces
reconciliation efforts
during close
​ Record fewer details in the GL by
linking summary account
balances to sub-ledgers housed in
a data warehouse.
​ Lower close process
resource costs
​ Reduced time spent performing
close and reconciliation activities
creates opportunities to transfer
resources from close to other
higher value actions, such as
forecasting. Customers using
Teradata have realized reductions
of personnel time spent on the
close process of 50-75%.
12
The Teradata
Difference
​ Improve throughput of
ERP transactional systems
during monthly close
process
​ Offloading financial data from an
ERP system to a data warehouse
provides a better segregation of
responsibility and control for GL
analysis. This eliminates the
problem of conflict and competi-
tion for log-ins (and unacceptable
response times) that occur when
a company relies on only
operational systems for analysis
during the close process.
​ Enhanced visibility into
geographically dispersed
results across multiple
business units
​ Standardized account and
geographical definitions
managed in the data warehouse
ensures that business units’ results
across countries are consistent
with corporate standards.
13
Customer Success
Stories
​ Nationwide
​ Finance Transformation Platform
​ Teradata connected disparate,
fragmented financial systems
environment into a single view of
enterprise financial performance,
reducing the close process from
15 to seven days and improving
the planning and variance
analysis process.
​ Medical Equipment
Manufacturer
​ Enterprise Performance
Management System
​ Source data came from more
than 400 global legal entities.
Financial systems could not
handle a major realignment. A
Teradata warehouse platform
delivers $6 million in annual
savings by reducing manual
processes, accelerating the close
and planning process, providing
flexibility to quickly reorganize the
business, and accelerating
integration of acquisitions.
​ NCR Corporation
​ Finance Transformation
​ Needed to transform from a
country-centric business model to
a centralized solutions focus.
Enterprise data warehouse
reduced the close process by
seven days and saved $50 million
in annual infrastructure costs and
improved asset management
($300 million sustainable reduction
in accounts receivable and
finished inventory levels).
14
Customer Success
Stories
​ SUPERVALU
​ Faster Financial and Tax Reporting
and Analytics
​ The merger of Albertson and
SUPERVALU financial reporting
created many challenges. A
Teradata solution helped reduce
close from 12 days to five while
improving enterprise reporting
accuracy and data transparency
and delivery of financial insight to
management.
​ United States Postal
Service
​ Accelerated Reporting and Data
Access
​ Had a lengthy, manually intensive
close process. New accounting
data mart gave managers access
to daily financial data at any
point in time to better manage
costs across 33,000 post offices,
reduced the close process,
provided analytic flexibility and
approximately $350 million in
savings, including maintenance
and support and reporting
architecture (fewer data silos).
​ HCA
​ Procurement and Vendor
Management
​ Sharing and integrating data on
multiple marts and platforms was
labor-intensive and time-
consuming. A Teradata solution
delivered $78 million ROI driven
through supply chain
improvements; lowered cost by
reducing vendors and product
items by 60%+; delivered
significant monthly close cycle
reductions with the revenue
reporting cycle moving from four
days to one and 75% fewer
analysts dedicated to monthly
and quarterly close.
15
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