We began our journey through the evolution of statutory reporting, looking at the impact of centralised delivery models. One of the main impacts was the greater control and ownership that central teams now had and the resultant ability to change and improve process. A large part of this change was the drive to standardise and ensure greater consistency in statutory reporting processes and financial statement content.
Regardless of which form of centralised model an organisation moves towards (full in-house, outsourced or a hybrid of the two) these models allowed central teams/owners the ability to standardise process and content.
Driving standardisation in centralised models:
Within fully in-house models, centralised teams – building on their growing knowledge and experience – began to identify where disclosures could be made standard. With standard notes being included across more and more legal entities, financial statements became increasingly consistent. More consistent financial statements allowed central teams to reduce the time taken in preparation and freed up time to review process to drive greater efficiency.
The process itself was now owned fully within the one team, a single consistent process could be deployed. This reduced potential errors, while driving greater accuracy and minimising time spent on preparing multiple versions of financial statements. Standard process also ensured that consistent account treatments could be applied, to minimise GAAP to GAAP adjustments and to reduce the bridge between US GAAP and Local GAAP.
The above examples are also true for organisations which adopted outsourced or hybrid models.
Driving standardisation in outsourced models.
For outsourced models, where the outsource provider provides a central delivery and relationship model, organisations partner with providers to ensure standard process and operating protocols are agreed. Integral to this is defining standard process delivery, with agreed sign offs and approvals. These agreed protocols, are then set out in Service Level Agreements (SLA), by which the organisation can manage and monitor on performance and delivery. In some cases organisations and providers will define a restriction on the number of GAAP to GAAP adjustments and link this to overall performance improvement indicators.
To drive standardisation organisations work with providers to identify standard notes, which can be consistently applied across various sets of financial statements.