BlackLine Magazine - Issue One

BLACKLINE

MAGAZINE

BLACKLINE

MAGAZINE ISSUE 1 - DECEMBER 2015

04

Therese’s introduction

Welcome to the Future of Finance

06

Cover Feature

Now, New, Next: The Future of Finance and Accounting

14

Product Perspective

BlackLine Products: Fulfilling the Promise of Modern Finance

16

CFO Rising

Why CFOs Need to Care about Modern Finance

18

Compliance

COSO Report Card: How Companies Are Measuring Up

20

Giving Back

A Formula for Giving Back – and Getting Back

22

Customer Story Dun & Bradstreet

Doing More with Less at Dun & Bradstreet

26

CFO Q&A

CFO Perspective: Manny Korakis

29

Security

Security Assessing SaaS Security: A Top-Down Approach

32

Customer Story Hyatt

Hyatt Using BlackLine to Track 200 Hotels, 120K–plus Accounts

36

Partner Spotlight

UHY Methodology Uses BlackLine to Bring Process Focus to Clients

38

Gary Simon

What’s in a Cloud? End-toEnd Support for Financial Processes, To Start

40

Tips & Tricks

Play From the Same Sheet and Drilling into ERP

THERESE’S INTRO

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ISSUE 1 - DECEMBER 2015

Welcome to the Future of Finance

By Therese Tucker

L

ast year in Chicago BlackLine introduced a new vision for the accounting and finance profession. It’s called Modern Finance, and it’s changing business - your business - in ways that might not have seemed possible a few years ago.

This first issue of our new customer

technologies such as cloud computing, Big Data

magazine is dedicated to telling you more

and analytics to bring the benefits of process

about Modern Finance and how it’s working for

improvement and better-informed financial

people at all levels of finance; for accountants,

strategies to all types of organizations.

controllers, auditors, CFOs and others.

You’ll hear how two CFOs are approaching

Finally, you’ll learn something about you: specifically, how customers come together with

Modern Finance; how some BlackLine

employees at each year’s User Conference to

customers are deriving the benefits of

volunteer arms, legs and hearts in helping out

transparency and standardization; and how

those less fortunate than ourselves.

companies can work with the new COSO

We hope and anticipate you’ll find

framework in mapping financial controls and

something in here of value to you, your

upgrading test procedures.

organization and your understanding of how

You’ll also learn, in our cover feature, how Modern Finance is making use of newer

Modern Finance can work to make your life better, today and in the future.

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COVER FEATURE

Now. New. Next.

The Future of Finance and Accounting

By Russ Banham

O

ver the past decade, one business function after another has been transformed by technology. The ways in which sales, marketing and HR are conducted today are vastly different. Finance and accounting was the latecomer to this party, but it is making the loudest noise.

The changes produced by the automation of repetitive, manual finance and accounting processes have set the stage for remarkable developments ahead: more insightful financial forecasts, vastly improved resource allocation, and extraordinary workflow efficiencies.

These advances are being called Modern Finance. They are occurring at the same time that the CFO function has metamorphosed to become highly strategic. They are changing the definition of what it means to be a corporate accountant, moving the position closer to that of a financial analyst. Most important, they are giving all-sized companies the tools to more effectively align their financial strategy with their business strategy.

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The changes produced by the automation of repetitive, manual finance and accounting processes have set the stage for remarkable developments ahead…

The future of finance and accounting is linked to

financial data and automating traditional finance and

adoption of these cloud-based technologies. Already,

accounting tasks, organizations make this gold mine of

these tools are providing organizations with enhanced

information searchable. Powerful algorithms make sense

visibility into the vast array of complex transactions at

of internal data sets in relation to each other, and these are

the heart of all businesses. They’ve resulted in faster

added to the immense array of external macroeconomic,

financial closings, greater confidence in the accuracy of

geopolitical and competitive market information on the

financial figures, worry-free financial statements, and far

Internet. The result: CEOs can plot smarter strategies to be

more assured regulatory compliance.

expertly navigated by their CFOs.

This is Modern Finance “now.” What is “new” and

“To do this, companies need access to the variable

“next” is paradigm busting. “There is this amazing

data sets that are stored in provider cloud systems,”

journey underway for finance and accounting executives,

he says. “These emerging capabilities will change the

where they are getting away from the mundane, tactical

role of accountants from validating the accuracy of the

stuff that has absorbed their time and effort forever,

numbers to making sure the CEO is creating the right

and moving toward functional excellence,” says Brian

business decisions.”

Sommer, ERP industry analyst at finance technology

Sommer is far from alone in this view. Chris Iervolino,

research firm TechVentive Inc. “The CFO is at last

a research director at Gartner, cited the improvements in

becoming the strategic business partner that CEOs have

finance and accounting efficiency that have already been

longed for.”

achieved by automating manual processes like account

Assuring this partnership is technology. By digitizing

reconciliation. But he is especially excited about what

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COVER FEATURE

Now. New. Next. The Future of Finance and Accounting

these digital tools offer companies in future.

“Cloud-based reconciliation tools have enhanced efficiency and improved visibility into workflows across the business,” he says. “They also have the potential

management and determining where the profits are in the business,” says Nick Castellina, research director at Aberdeen Group.

Robert Ployhart, Bank of America professor of

to provide new analytic capabilities; this seems to

business administration at the University of South

be where these automated reconciliation tools are

Carolina, equates the above to “Staring at your feet

headed. This will help the CFO guide and support

while you’re walking, versus looking down the street at

more organization-wide initiatives. As the role of the

where you’re going and what lays ahead.”

accountant evolves, their specialized expertise will be put to more strategic uses.”

Yesterday’s Finance & Accounting This is undoubtedly good news to many accountants

He says “Automating rote manual processes, assuming this is available for a particular business function, is a `no brainer.’ You liberate intellectual assets to apply their expertise to more beneficial purposes.

Accountants can’t do that when they’re plugging in

stuck in the trenches performing manual tasks like

numbers. There’s this tremendous opportunity at hand

account reconciliations, transaction matching and

to enable them to become strategic thinkers, in ways

variance analyses. As the pressure intensifies to

that weren’t possible before.”

close the books each month, these tasks become excruciatingly burdensome and anxiety-ridden, given that senior executive leaders are raring to access the

Today’s Finance & Accounting The use of cloud-based software to automate finance

financial data to possibly make adjustments in strategy

and accounting processes has become a competitive

and tactics.

differentiator. Boards, shareholders, analysts and

When uncertainty about the accuracy of a journal

other stakeholders have come to expect more refined

entry arises, accountants must dig through a mountain

forecasts of business performance and more rapid

of spreadsheets to prove the balances are correct.

identification of growth opportunities and related risks.

Without an automated system attending to this chore,

Many businesses have yet to realize these

there’s simply no visibility into the underlying data.

emergent expectations. “There are many dysfunctional

Literally thousands of multi-line-item spreadsheets

companies still stuck on spreadsheets and out-of-

must be analyzed, a Sisyphean effort challenged by the

date technologies,” says Sommer. “This is unfortunate

different ways the spreadsheets were created and used

because functionally excellent companies are where

across the business.

things get really cool. They’ve shifted to (using) cloud

These complex workflows make sorting out a single

accounting and finance workflow management tools,

version of the truth an exercise in frustration and futility.

where manual processes remain for exceptions only.

All the while, accountants are aware that a fast and

This fosters greater collaboration up and down the

error-free closing is critical to the organization’s bottom

value chain - or what I call the `automation everywhere’

line, compliance responsibilities and reputation. As

business organization.”

the minutes tick away to close the books, no time is available to do anything else.

This is not Modern Finance. “You’re taking time away

By automating rote tasks, people are freed to apply their skills to more strategic needs like financial analysis.

The same automation also sets the stage to undertake

from these human resources when they can be adding

these examinations. “By digitizing the financial data

value, doing things like revenue forecasting, cash flow

and storing it in a centralized repository in the cloud,

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…accountants can apply their expertise to ensure compliance. “It just makes the whole process easier,” Castellina says. “You’re less likely to be audited, and if you are audited it’s less likely to cost you.”

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COVER FEATURE

Since users have unprecedented visibility into the progress of all processes involved in the financial close, the ability to validate the accuracy of the data is vastly enhanced. “No longer will accountants have to deal with inexact numbers, which drives them nuts,” Sommer says.

companies make this information searchable, facilitating real-time calculations,” Castellina says.

What might these calculations be? For one thing,

required corrections.

Since users have visibility into the progress of all processes involved in the financial close, the ability to

accountants can apply their expertise to ensure

validate the accuracy of the data is vastly enhanced.

compliance. “It just makes the whole process easier,”

“No longer will accountants have to deal with inexact

Castellina says. “You’re less likely to be audited, and if

numbers, which drives them nuts,” Sommer says.

you are audited it’s less likely to cost you.”

Iervolino agrees: “Assuming visibility into the

Others in the organization can be offered the same visibility into the financial data to improve the

financial data, companies can expect definite

services they provide the business, Castellina notes.

enhancements from an auditability standpoint.”

“Not only is it easier to share this information across

Easier calculations also facilitate a faster close.

the business, you quickly learn that you can do the

With an automated account reconciliation system,

same tasks with fewer people, resulting in significant

data is imported from the ERP system into this

resource efficiencies.”

system’s online document repository, which stores

Rather than manually crunching numbers, human

and safely archives all supporting documentation.

resources are applied to tasks that are strategic by

Accountants can search through the details of account

nature. These are prized benefits of today’s Modern

balances across all balance sheet accounts, explore

Finance, available to companies right now.

any discrepancies that pop up, and then make the

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Tomorrow’s Finance & Accounting What is coming down the pike - the application of Big Data and analytics to financial data - promises the greatest change in finance and accounting in its history, upending the role of the CFO and his or her staff to navigate the business going forward.

The same tools now used to automate manual accounting tasks will be leveraged to create workflow efficiencies and inform strategic financial analyses. “The overarching goal is for businesses to be able to ask questions of their data to plot more assured strategies, manage workflows more efficiently, and allocate resources toward where they will achieve the biggest bang for the buck,” says Sommer.

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COVER FEATURE

Predictive modeling of financial data is close to the point of describing current workflows in relation to task performance.

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Now. New. Next. The Future of Finance and Accounting

Much work in this direction is currently underway.

sports analogy, it’s the difference between being a

“Predictive modeling of financial data is close to the

scorekeeper and a coach. The scorekeeper tallies the

point of describing current workflows in relation to

numbers; the coach is looking strategically five plays

task performance,” says Therese Tucker, founder

ahead on how to win the game.”

and CEO of BlackLine. “The models will help identify

The CFO is this coach. He or she has become

opportunities for improvement in finance and

so vital to their companies’ corporate performance

accounting workflows, which in turn will help staff

management (CPM) that Gartner recently split its

become more productive for strategic purposes.”

tracking of CPM into two areas - strategic CPM and

Since providers of enhanced financial automation tools are repositories of an enormous amount of

finance CPM. “We see a definite trend, from automated tools

financial data across different industry verticals

that increase efficiency and support the process

- imagine how much account reconciliation data

of planning, through more transparent workflows,

these firms have stored - it is expected that such

and toward finance using these tools for predictive

companies will lead the effort to develop these

modeling and improved analytics,” Iervolino says.

predictive models. When they do, finance and accounting will learn where they are ahead of the

It’s tomorrow’s Modern Finance, whipping into shape today.

eight ball or behind it, process-wise.

For instance, say that finance and accounting in a manufacturing firm wants to learn whether or not the volume of account reconciliations it rejects is consistent with the experience of other manufacturers. By acquiring information on the average volume of rejections, it can learn if its practices are below the mean. This metric for benchmarking purposes would be available from the financial automation services provider.

Even better, the provider can leverage predictive modeling to provide going-forward advice. By understanding the factors causing deficient performance, for example, a company can reengineer its workflows to improve its score. As more clients take these steps, this adds to the provider’s data storehouse, feeding the expanding knowledge of account reconciliation best practices.

“The promise of Big Data in finance and accounting is its ability to identify patterns involving time and resources and how better to utilize them,” says Ployhart. “When you’re stuck spending all your time on validating the accuracy of the data, there’s no time left to discern these patterns. To borrow a

Russ Banham is a Pulitzer-nominated business journalist and author of 24 books. He has written for all the major business publications and is an expert on the evolution of the role of the CFO, writing on this subject in hundreds of articles for CFO Magazine.

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BLACKLINE PRODUCTS

BlackLine Products: Fulfilling the Promise of Modern Finance BlackLine’s 2015 Product Announcements Flesh out the Details

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M

odern Finance delivers transformative benefits for financial processes of all types.

This year’s announcements demonstrate how Modern Finance can benefit users at all levels of the enterprise:

Process Analytics Automation is the beginning, not the endpoint,

The Intercompany Hub is a centralized repository that helps automate validation,

of Modern Finance process transformation. Today’s

processing, invoice creation, journal generation,

businesses face constant change, and business

posting and settlement of intercompany

processes are required to adapt. Financial processes

transactions. Benefits range from improving end-

are uniquely challenged because they are time-

to-end visibility to reducing process complexity and

sensitive and risk-averse.

financial risk.

BlackLine Insights is a continuous-improvement tool that will grow to give CFOs the ability to fine-tune their financial processes by measuring performance against industry benchmarks. The initial offering includes measurements such as percent-of-reconciliations-automated and reconciliation-rejection-rates-by-role. Near-future updates will expand the number and range of

Making Better Use of Accountants’ Time A goal of Modern Finance is to help accountants spend more of their time on high-value projects and less time on tasks that can be standardized and automated. Three BlackLine product upgrades address the challenge: Automated Journal Entries lets users create pre-

insights; longer term, BlackLine’s analytics tools will

defined logic to automate recurring journal entries in

include prescriptive and predictive functions.

areas such as cash settlements, credit-card and bank

Process improvement is valuable throughout the organization, but it’s especially important with the increasing strategic value of financial processes.

As business operations grow more complex, the importance of agile financial processes becomes more acute. That’s why CFOs look to analytics for the means to adjust and adapt financial processes to business goals.

fees, allocations, amortizations, and numerous other entries. Also, a Journal Master feature facilitates building recurring journal entries by automatically inserting role assignments, header information, journal lines and other information for each period.

Innovations like these can cut significant effort out of posting journal entries, a major time-sink in most businesses.

An integrated-spreadsheets feature for account

A Multi-Company Clearinghouse Global reach is a hallmark of modern business.

reconciliations lets accountants use spreadsheets that are fully integrated into BlackLine’s Account

More organizations than ever before are working

Reconciliations product. This makes it easier for

across multiple business units, lines of business,

accountants used to handling spreadsheets to

continents and currencies. Company accountants are

benefit from BlackLine’s automation and integration

challenged to take into account pricing agreements,

features without having to give up their well-earned

exchange rates and taxes. The result: uncertainties,

knowledge and experience.

delays, and errors in intercompany accounts.

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CFO RISING

Why CFOs Need to Care about Modern Finance

By Claudia McDonald

Mark Partin

T

oday’s CFOs are being held to a higher standard than ever before, whether in terms of the technology and other equipment their organizations buy, the people who are hired, or the processes that are put in place to seize competitive advantage on the global stage.

That’s the view of Mark Partin, BlackLine’s CFO. High standards are in Partin’s wheelhouse - he’s a competitive triathlete who looks a decade younger than his 47 years. In many ways, he embodies the Modern Finance CFO of today, a skilled financial person not just looking backwards at historical sales figures and capital expenses, but also looking forward at where the CEO’s strategy is taking the company and what might be in the way.

“Finance is the group that is supposed to be the most forward-thinking in an organization, yet many CFOs are still solving problems the old ways,” he says. “To become more strategic in our roles requires more strategic people in our employ and more strategic investments in technology.

Otherwise, the CFO will always be the `reluctant accountant.’”

Asked what he means by the term, Partin explains that accounting is where many CFOs start their careers, but this is just one function of the role. “You need to do that to ensure the accounting and the financial statements are accurate, but much more is demanded of today’s CFO. Just like other parts of the organization are being held to a higher standard of performance, world-class companies are asking the same of their CFOs. “Modern Finance should be the goal, leveraging technology to automate rote, repetitive accounting processes and improve operational excellence.”

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Better Controls, Greater Accuracy, More Informed Forecasts To ensure more efficient processes, a faster monthly close, more accurate financial statements and a reduced risk of accounting irregularities, CFOs should care about automating account reconciliations, journal entries, and a wide range of external and internal transactions.

The faster the monthly close, the sooner business leaders have access to the organization’s financial data to make adjustments in strategy and tactics. The less time left to close the books, the greater the risk of making a mistake. Error-free financial closings are critical to a company’s compliance and fiduciary responsibilities and, by extension, its reputation.

When blunders occur in the manual process of validating accounts and transaction balances for compliance purposes, accountants must manually correct them. This heaps more work onto their desks or compels companies to hire more accountants to handle the overload. Small wonder that accountants have been one of the “ten hardest jobs to fill” in industry researcher Manpower Group’s last three annual talent shortage surveys.

The time that accountants save from not having to manually attend to rote tasks using spreadsheets can be put to more strategic needs like predictive analytics, providing the CFO with data-driven, forward-looking guidance to navigate the company’s growth initiatives with a better understanding of the related financial and market risks.

“Like all CFOs, I need visibility into our operations to gauge the risks to our strategy,” Partin says.

“At the same time, I want to be sure my view of operations is accurate. You can’t manage finance and accounting without trust in the numbers.”

To do that requires the ability to not just validate the numbers but also verify them, which demands unimpaired visibility into financial and accounting data to detect mistakes and deficiencies before they become a problem.

Cloud Levels the Playing Field In today’s fast-paced business environment, having a world-class technology infrastructure has become a competitive differentiator, particularly for midmarket companies presented with myriad market and geographic growth opportunities.

In recent years, one business function after another has seized significant advantages by implementing cloud-based tools for sales, marketing, supply chain, inventory, HR and other purposes. Finance/accounting has been late to this party. For CFOs to achieve the high standards that Partin advocates requires similar investments.

“The more complex the organization, the more tools like ours are needed,” he said “For today’s CFO, this is now the price of entry.”

Claudia McDonald is associate editor of BlackLine Magazine

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COMPLIANCE

COSO Report Card: How Companies Are Measuring Up

By Jim Buchanan

T

he practice of accounting is orderly, measured, and demands the highest levels of precision and accuracy. The new COSO framework, however, is somewhat the opposite.

First announced in 2013 and still under adoption by some, it’s more interpretative than specific, qualitative than quantitative.

Bob Hirth

True, the new version gives companies the ability to map internal controls to 17 newly codified principles. But organizations looking for strict, by-the-numbers guidance to fulfilling COSO to the letter won’t find it. Instead, they’re finding that fulfilling the spirit of COSO means relying on their own good judgment; that, along with the help of their auditors.

Bob Hirth, current COSO chair and a former senior managing director for Protiviti, notes that COSO 2013 adoption is strong, at nearly 80 percent currently. Still, public companies and auditors face the challenges of satisfying the still-evolving interpretations of the framework. Hirth expects that what he calls “generally accepted COSO documentation” will emerge at some point in the future. But for now, he says, “Questions about completeness of controls really come down to ‘How much is enough?’”

These questions apply in a number of areas:

Anticipating SEC Requirements The SEC wants to see a “suitable” framework in place for financial controls, and it considers the new COSO suitable, but it stopped short of mandating any new framework through a rule-making decision. Although the SEC hasn’t set a deadline, Hirth feels that any company that hasn’t transitioned by the end of 2015 should expect tougher questioning on risk assessment and controls from the SEC.

Determining Control Precision Control precision gets to the essence of control quality, and plays into principles such as those supporting the risk assessment category. There’s plenty of gray area in determining what level of precision is enough for any given direct or indirect control.

“Say you’ve got a $40 million balance on your financial statement,” says Hirth. “To check that balance for accuracy, a mid-size company might feel it’s sufficient for management to have a meeting

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and review the balance for reasonableness.

“But that might not satisfy the auditor, who feels that the $40 million is of material importance because of the size of the company.

So you may have to dig deeper to get the auditor’s approval – to validate and test some of the transactions that went into that number.”

people who are involved in financial reporting can understand the risks of fraud and can take preventive measures.”

Leveraging Technology, Auditor Relationships Hirth says that the new framework’s expectations are higher than the old, in part

Evaluating Outsourcers The new framework references outsourcing

because the advent of technology makes it possible for companies to see their financial

in a number of areas, noting specifically that

processes more clearly, and to safeguard them

a public company should maintain as much

more effectively. Various software tools help

responsibility for outsourcer controls as for its

companies map their internal controls to the

own safeguards.

principles and their supporting points-of-focus.

“The reporting convention was you’d be

And process automation helps companies

satisfied with the outsourcing entity’s SOC

standardize financial reporting tasks. Automation

reports,” says Hirth. “Not any more – just getting

can reduce human error and help prevent

SOC reports doesn’t relieve you of responsibility.”

fraudulent review-approver relationships.

It’s now the outsourcing user’s

Hirth notes that companies should fully

responsibility to test the outsourced product

engage with their auditing firms for help in

– say an investment management report – for

implementing and carrying out their COSO

reasonableness. “The SOC reports tells you about

adoption.

the vendor’s controls,” says Hirth, “But it’s up

“The auditors pay close attention to the Public

to your management to test the product you’re

Company Accounting Oversight Board, and

getting and ask questions if necessary.”

the PCAOB will be determining what’s working and what’s not as they gain more experience

Assessing the Risk of Fraud One of the new framework’s 17 principles

overseeing framework adoptions,” he says.

“For one thing, the auditor can be a great help

deals specifically with identifying and analyzing

with setting expectations for entity information

any risks of fraud that may exist. The principle

baselines, something that’s important because

and its four points-of-focus are clear, but they

it determines the quality of subsequent controls

don’t include step-by-step instructions. As with

and testing information.

the other COSO elements, it’s up to the company,

“And even though companies may see a slight

although fraud risk assessment is another area

increase in deficiencies from their auditors, that’s

where Hirth expects efforts will eventually

to be expected with any new program. Just think

coalesce around some common solutions.

of it as a bump along the road to getting the

“Fraud risk assessment efforts vary,” he

most out of the new framework.”

says. “For some, it might just mean completing a memorandum concerning management’s thinking. For others, it might mean holding regular meetings throughout the organization so

Jim Buchanan is editor of BlackLine Magazine

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GIVING BACK

A Formula for Giving Back – and Getting Back

D

iane Romualdez is BlackLine’s director of corporate events. At any given moment she’s watching over trade shows, seminars, conferences and other events. She estimates that her group handles about 200 events in a year. And the number keeps growing.

Chief among her responsibilities is arranging for BlackLine’s annual user conference, and an important aspect of each conference is organizing a company tradition called Giving Back Day. The first Giving Back Day took place in 2010, when BlackLine volunteers joined volunteers from BlackLine customers to work with Habitat for Humanity in rebuilding homes damaged by Hurricane Katrina. Romualdez joined the company the following year, and since then her group has organized projects in San Francisco, Los Angeles and Chicago.

BlackLine Magazine: It’s great when companies donate resources to the community. How did BlackLine go about choosing to do it in this way?

Romualdez: It’s something close to Therese’s heart. She’s a regular benefactor to nonprofits, with a focus mainly on homelessness and families – particularly women and children. She gives back personally quite a bit. I think it’s something she’s wanted to build into the culture at BlackLine. And she was somewhat inspired by the need for help following Katrina.

BlackLine Magazine: How do you go about organizing a community project?

Romualdez: At the time we open up the conference registration we also create an option for people to join us for Giving Back Day. We typically get 100 to 125 volunteers; most are employees, but usually 20-orso non-employees join us.

To make the most of the event I try to arrange for at least two half-day projects – the program started with just Habit for Humanity, but now that we’ve grown we work on two projects for each conference. A project might go from seven in the morning to two or three in the afternoon. And we try to strike a balance to appeal to different people. There might be some heavier work, like framing houses or banging nails, and some lighter work like putting hygiene kits together.

Mainly we want to make the day worthwhile – to our volunteers as well as the people we’re helping.

BlackLine Magazine: How do you arrange the schedule?

Romualdez: During breakfast we kick off with some basic orientation, like background on the organization and what their cause is about. Then we go right into dividing up the teams and they

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BlackLine Charities

Giving Back Videos

WORKING WITH GLIDE IN SAN FRANCISCO

GIVING BACK IN THE WINDY – AND COLD – CITY OF CHICAGO

head for their projects. When it’s possible we like to be able to switch up projects during the day. This way everyone can get the feel for the different parts of what the day entails, and each volunteer can participate as fully as possible.

BlackLine Magazine: Is there any problem with you bringing in so many people at once?

Romualdez: Not really. We prepare well. We start a conversation with the agency about six months in advance and set a placeholder for the date, so they know what’s coming, and so we have a sense of what our people will be doing. We also make a dollar contribution to cover supplies and other things we’ll need like equipment, paints, and brushes, for example, plus food and transportation.

We make a regular donation, too, and at registration we give the attendees the option to donate.

BlackLine Magazine: What would a typical project look like – how would it work?

Romualdez: In 2012 we were in San Francisco and we worked with a fantastic and well-known organization called Glide. Our clients and employees prepared food and served in the breakfast line. They also made facilities improvements, like painting. We also packed lunches – everyone got a chance to do a little of everything.

In 2013, in Los Angeles, we went to the Dream Center and to Los Angeles Mission – Therese is a regular supporter of LA Mission. We split up the groups between those two locations and packed hygiene kits, distributed clothing and interacted with their clients, playing with the kids whenever we could. Interacting with the kids and families and clients is the best part of what we do, and we try to encourage it.

BlackLine Magazine: What’s in store for this year?

Romualdez: This year we’re working with Habitat for Humanity and Hands on Atlanta. We’re doing a house build with Habitat for Humanity. With Hands on Atlanta we’re doing a project with the United Methodist Children’s Home, which does a lot for the people of Atlanta. It places children into safe and loving foster care homes and also provides housing and support for families at risk of homelessness. We’ll be building picnic tables, painting, landscaping, and helping in the administrative office.

BlackLine Magazine: You said that the experience is rewarding for the volunteers. What did you mean?

Romualdez: Well, we like to end the day by getting back together and reflecting on what we’ve done and who we’ve met. We realize that we’ve gotten to know some fine people, we’ve gotten to know each other, and maybe we’ve even gotten to know ourselves a little better. Being able to work side by side to help people is a great experience, and it’s not unusual for attendees to tell us that the day was a high point of the conference for them.

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CUSTOMER STORY

Doing More with Less at Dun & Bradstreet

By Claudia McDonald

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S

ince 1841, Dun & Bradstreet has been a trusted provider of commercial data to business, addressing such traditional information needs as counter-party risk exposure and credit history, as well as more modern social-identity matching. Today, nearly 90 percent of the Fortune 500 and other of the world’s companies rely on Dun & Bradstreet’s data, insights and analytics to drive business decisions. The company’s reports effectively grease the wheels of commerce.

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CUSTOMER STORY

Like all enterprises, Dun & Bradstreet is focused on growing its own business. In this regard, it found that it was challenged to execute its financial close with the most efficient processes and assured controls. “We wanted to do more with less,” says Gretchen Sikora, Dun & Bradstreet’s senior finance leader.

Complicating this ambition was the company’s rapid geographic expansion over the past two years. Finance/accounting team members and processes were all over the world, making each local market’s financial close an independent and separate exercise. “We have over 70 operating entities worldwide, and at any one time we never knew the true status of key financial processes,” she says. “It was a challenge to ensure our controls were consistently improving.”

The challenge was significant. The control organization had no way of knowing if account reconciliations were properly completed, documented and reviewed. There also was no mechanism to capture risks and opportunities in a methodical way. As a result, it was not uncommon to worry about possible “surprises” during the financial close process, creating a reactive control organization instead of a proactive one, Sikora says.

From a compliance standpoint, there also was no knowledge of how Dun & Bradstreet’s SarbanesOxley-mandated controls were being executed across the business. “Due dates and delivery of quality data were questionable and always a challenge for our controller organization,” she says.

Taking Charge The need for transformation was acute. To kick things off, the control organization in 2012 created a Center of Excellence to support the standardization

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and centralization of key financial and accounting

Sikora and her team nonetheless worked closely

functions worldwide. Everyone in Dun &

with the CoE’s accounting team to train them in the

Bradstreet’s control organization, no matter where

tools’ use. Once they had become experts, they

they were located, would execute the financial close

endeavored to train global colleagues, until the

processes using similar formats and following best

effort “ramped up like a virus,” Sikora says.

practices to ensure a timely close.

Strategic objectives were established. The

She remembers several team members commenting on how the tools saved substantial

company wanted to standardize and improve the

time and eliminated much of their non-value-

control environment; improve organizational depth;

added work, especially with auditors. The control

implement best practices; eliminate redundancies;

organization had similar positive comments, with

and create career opportunities.

Dun & Bradstreet’s audit and Sarbanes-Oxley

As part of this ambitious agenda, Sikora was

managers “entirely comfortable” in stating that the

tasked with overseeing transactional accounting on

company now has sufficient controls in place and all

a global basis. Her obligation was to find a way to

supporting documentation.

better track and monitor key functions like account

“As leaders, we now have a tool that globally

reconciliations. To do this, she evaluated different

provides transparencies and insight 24/7 from the

providers of best-in-class finance controls and

preparer standpoint up to the Corporate Controller,”

automation technology. The criteria in choosing the

Sikora says.

provider were whether or not their software tools

The irony in this story is that five years earlier a

would accelerate the financial close, provide process

Sarbanes-Oxley manager had introduced Sikora to

automation, improve the control environment, and

BlackLine, but it was premature at the time for Dun

centralize the preparation, review and monitoring of

& Bradstreet to consider its implementation.

financial data.

In the Bag In BlackLine, Sikora found what she sought. “To

“I will always tell someone, `I wish I would have engaged BlackLine years ago,’” she says. “BlackLine has become the central and most important tool we use in accounting. The automation, improvement in

me it was all in one bag,” she says. “I now had a tool

controls and, most importantly, the peace of mind

to meet our key strategies.”

that BlackLine brings is more than enough to share

Aside from the quality of BlackLine’s products, Sikora was impressed by the sales support she and

(its value) with others.”

She adds, “And I can sleep at night now.”

her product review team received during the vetting period. Other factors included the tools’ reporting and monitoring capabilities, ease of use, and the end results of this use.

Adoption of the tools was straightforward, she explains, as the company had already created the structure for the Center of Excellence (CoE).

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CFO Q&A

CFO Perspective: Manny Korakis

E

mmanuel “Manny” Korakis had been on the job only four months when he spoke with BlackLine Magazine, his job being CFO of S&P Dow Jones Indices, one of the world’s leading providers of financial market indices and home to the S&P 500 and Dow Jones Industrial Average. For nearly nine years he had been senior VP, corporate controller and chief accounting officer at McGraw Hill Financial, and before that he worked at several public accounting firms, beginning his career at Arthur Andersen. Korakis is only 41, but through the years he’s watched the CFO function morph from a back office number cruncher to the strategy-savvy, forward thinking Modern Finance officer of today.

BlackLine Magazine: How do you think the CFO’s role is changing?

Korakis: I worked with a lot of CFOs when I was in public accounting. Their number one responsibility then was crunching the numbers, which is much less important today than making sense of the numbers. The old stuff is pretty low on the list of things that concern me today. I’m focused on the changing landscape of regulation and the globalization of markets, industries, businesses, our competitors and our customers. Keeping pace with all that and the increasing demand for timely and actionable information is what absorbs much of my time. Notice I said information, which is different from data.

BlackLine Magazine: Data and information are two different things?

Korakis: Yes, and it goes back to what I was saying about the evolution of the CFO’s role. Number

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crunching was a way to get the historical view

Korakis: I’ve come to the point where I no

of what was happening. You looked in the

longer believe there is a single set of metrics

rear-view mirror at your performance to guide

that you can use to determine success broadly.

decisions on the business going forward. Today,

The most important determinant of success is

you take what has happened historically - all

making sure the financial plan is well aligned

this data - and you apply your intellect to this

with the business plan. They have to be in

data and turn it into information. You use your

lockstep. Having metrics around that is relevant,

analytical skills to forecast the future the best

but they have to change year to year. For

you can, and then align your business strategy

instance, you may have a year where you think

accordingly. It’s forward thinking finance.

a certain set of objectives are most important to

BlackLine Magazine: It sounds more exciting

the business, and then something happens that

than the old CFO description, but also more

forces you to change your plans. Locking into

demanding. How do you stay current?

metrics can cause you to be shortsighted and

Korakis: It’s probably one of the hardest parts of my job; you can’t know everything

too focused on the short-term.

BlackLine Magazine: That makes

about everything. The trick is to know enough to

tremendous sense, particularly in today’s

know when to react or to reach out to an expert

dynamic business environment. How do you

before you react. It’s important to stay close

determine where to expand the company’s

to customers, to get on the phone and talk to

market and geographic footprint and where to

the larger ones, and get their view of what they

hold off?

see in the market. The same goes with talking

Korakis: In today’s global economy,

to vendors, peers, competitors and colleagues.

companies have only so much bandwidth - you

You need to be a good listener, taking in others’

can’t go to every country and engage every

perspectives. After that, you follow your own

market and expect to get a good return on

instincts.

your investment. So it’s up to me and others to

BlackLine Magazine: So today’s CFO is left

investigate the local customs, culture and tax

brain and right brain, someone with accounting

laws to determine whether we need to replicate

savvy, analytical gifts and conversational skills.

every function in this market or region or serve

What else has changed?

these needs from another region. Are there

Korakis: Back in the day, the CFO would

skill sets available in the market? Should we

prioritize the financial goals once a year. You

maybe engage in a partnership as a better way

can’t do this today. Business is more dynamic

to protect the brand? My point is this is not a

and fluid now, even if the basic principles remain

one-size-fits-all answer, where we simply do

the same. New ideas are constantly being

the same thing with each growth opportunity.

generated to make the business more efficient

You need a business plan, but you also need

or bring in more revenue. You have to be agile

flexibility to dial up or down parts of the plan.

as the CFO to allocate or reallocate investment dollars where they will have the biggest impact.

BlackLine Magazine: What are some of the measures you use to ensure finance is going in the right direction?

BlackLine Magazine: What’s your take on process and technology as related to business strategy?

Korakis: The ERP system may not be best suited to solve all problems. That’s when cloud

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CFO Q&A

applications make sense, assuming integration with the backbone ERP system, whether it’s on premises or in the cloud. Changing a process is more problematical because of the sheer volume of data that comes through that process. An example is the thousands of individual transactions being reported in different ways using spreadsheets. There’s too much risk of a mistake when you have multiple people touching all these elements. To drive critical business decisions, you need information that is accurate the first go round. The faster you have that information, the more informed and quicker your business and financial decisions.

BlackLine Magazine: How do you drive continuous improvements in your finance group?

Korakis: You need to establish clear performance metrics measuring where you are going.

Understanding what these metrics are is difficult and takes some time. But once you’ve defined them you can drive a culture of accountability.

BlackLine Magazine: Is SaaS the future of finance? We ask because the finance function has been late to the party, slow to adopt cloud applications when compared to sales or HR. Korakis: I get asked that question a lot. I think the slowness has to do with people’s fear of letting go of their current systems and the data that goes along with them. For me, the primary concern is, `Does this app have the right functionality to drive the results we are looking for?’ If the app offers this, then I move to the next step of whether or not to have it hosted or run it internally. That decision rests with how much customization of the application I need, which would lead me more towards internal control. Otherwise I am fine with a trusted third party managing the app for me.

BlackLine Magazine: Where do you see the current use of business and financial applications headed?

Korakis: The world is so connected today; mobile apps make our work more efficient. Last Saturday, I sat on the beach approving expense reports using an app on my smartphone. A few years ago, I’d have to be in my office doing that, which is not where I want to be on a Saturday. I use apps to approve invoices for payment on my phone. When you have apps like these, you have great visibility into the data, which is on hand 24/7.

BlackLine Magazine: Meaning you can work and catch a tan at the same time.

Korakis: Then, go for a swim.

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Assessing Security

Assessing SaaS Security: A Top-Down Approach

By Jim Buchanan

C

onventional wisdom has it that SaaS vendors – that is, those that market cloud-based software-as-a-service – often maintain higher levels of information security than their clients. The reason: security is closer to the SaaS vendor’s business model, and thus its profitability, than it would be for a non-SaaS vendor. Also, early SaaS sales often went to early adopters, who were smaller and less security conscious than their larger competitors.

That formula is changing. Today’s SaaS contracts are going to large and sophisticated customers, and SaaS solutions are increasingly used in business-critical applications. So if you’re shopping for a SaaS offering, such as BlackLine’s, that will function within strategically important process chains, you have every right - indeed, responsibility - to assess your prospective vendor’s security complement with a critical eye.

According to Max Solonski, BlackLine’s VP of information security, due diligence should start at a high level, and then work down to the details. First, he says, look for a framework that suits your organization’s security and business needs. That framework will shape the policies, processes and personnel that make up the information security architecture.

“If the vendor bases its information security system on the ISO27002 framework, that’s a great start,” he says. “It’s all-encompassing and time-proven. But ISO27002 takes a lot of effort and expense to implement. It’s too much for some SaaS vendors.”

Still, the vendor’s framework should be sufficiently comprehensive to address all the organization’s security risks. And the more familiar you are with the ISO27000 series of standards, the better you’ll be able to evaluate the vendor’s information security capabilities.

Solonski says you should then look closely into three main areas: qualified personnel, adequate controls, and effective governance.

Starting with People Information security should be governed and operated by a dedicated staff, trained in information security. The info security function should report to a high-level executive, preferably outside of IT. To avoid conflicts of interest with other technical teams around security controls, that executive should report to the CEO, CFO, or to the legal office. Ideally, the info security group’s budget will be separate from the others, and info security will have the commitment of C-level and board executives.

Assembling a dedicated staff is just a first step in creating an effective info security personnel

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ASSESSING SECURITY

policy. Next, info security staff should collaborate with other employees to determine

Setting Controls Technical and administrative security controls

who’s best suited to carry out the various

should be placed strategically throughout the

security- related functions.

organization. At a high level, controls exist

“People shouldn’t think of info security as

in administrative policies and governance; in

a bucket where they can toss everything that’s

vendor management, accounting, and so on. At

security-related,“ says Solonski. “In most cases,

a lower level, they’re present in hardware and

security tasks that are related to non-security

software, in everything from network firewalls to

employees’ functions should still be done by

physical plant security.

those employees. Info security people should be

These should all be inspected and tested

used for educating employees and facilitating

regularly, just as one would test backup and

employee interactions with security.”

continuity processes to make sure that the

He points to a company doing application

systems will be effective in an emergency.

development as an example, where software

And the vendor should have well-defined

engineers will collaborate regularly with info

and tested policies and procedures in place for

security engineers to determine the best way to

responding to all incidents, whether security-

incorporate information security into software

related or not. An outage or other incident

design. That collaboration saves time during

can turn out to be security-related. Effective

QA and security testing, and can help shorten

procedures will allow for quick containment to

development cycles.

limit the damage.

Finally, the responsibility for, and

“A network might slow down for no apparent

commitment to, security should extend out to

reason,” says Solonski. “In this case network

all employees in the organization.

engineers will have a procedure for identifying

“At the end of the day, even the best

the cause. But incident response procedures will

safeguards can’t fully protect a company if

also determine if there’s a security component

the employees aren’t careful,” Solonski says.

to the incident. If there is, a security incident-

“Employee security-awareness is a necessary

response process should evaluate the risk and

component to maintaining across-the-board

trigger the remediation.”

info security success, and it’s up to the security

You should also look for policies and controls

people to promote security consciousness

specific to that vendor’s information architecture

through training and other programs.”

and business model. For instance, a vendor

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might be running a legacy application that’s

report - which you should ask for - will describe

been “modernized,” or they might be exposing

how an organization compares against a set of

often-exploited technologies such as PHP or

prescribed controls that a service provider is

WordPress to the Internet. In these cases, you

expected to maintain.

should look for the presence of purpose-specific

Finally, pay close attention to the scope and

compensating controls such as web application

subject of the audits. The audit report should

firewalls or strict connectivity limitations.

cover the SaaS vendor and not just that vendor’s

Let’s Review – and Audit A commitment to regular, ongoing review

sub-provider, because the sub-provider report won’t include a description of the SaaS vendor’s security posture. Also, make sure the report

and feedback is essential to the success of the

covers all the vendor’s facilities and locations -

info security program. The SaaS vendor should

not just the data center that houses

perform regular internal risk assessments and

the application.

reviews of its controls, and should contract with independent auditors for periodic audits of the entire info security infrastructure

Striking the Balance As a SaaS prospect or customer you should

“Customers can expect their vendors to

expect a strong level of communication and

disclose the state of their controls and security

a fair level of transparency from your vendor.

practices” says Solonski. “Typically this is done

Communicating security processes, audit

by the means of third-party audit reports such as

feedback and related information to customers

SOC2 Type 2. Some vendors go beyond that and

is good business, and SaaS vendors know that.

let prospects and customers perform controlled

Transparency into controls, personnel, and other

penetration testing of their applications.

security-related details can be useful, too, in

“But bear in mind that not all certifications and audit reports are the same,” he says.

“A major certification like ISO27001-2013 shows that the vendor’s info security functions have passed stringent independent audits.”

Other standards-based audits may not be

helping you appreciate the vendor’s commitment to keeping your information and applications secure.

But you should realize that at some point the vendor has to go quiet, especially when it comes to proprietary security methods or tools. So

as encompassing. For instance, the SOC1 Type

don’t expect complete disclosure when you’re

2 (also known as SSAE-16) audit validates the

investigating SaaS vendors. After all, the data

list of controls that an organization provides

the vendor is protecting might someday be

to the auditor, while the SOC2 Type 2 audit

your own.

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CUSTOMER STORY

Hyatt Using BlackLine to Track 200 Hotels, 120K–plus Accounts

By Claudia McDonald

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F

or Jeanette Nimmo, global process owner/GL for Hyatt Shared Services, BlackLine has helped boost accounting efficiencies in a number of ways. Auditing is an example. “Auditors get direct access to BlackLine. They can pull all the information and all the backup they need. Our group just gets them into BlackLine and then takes them out when they’re done - it’s a huge time savings,” she says.

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But the built-in auditor function was just one of several reasons Hyatt

CUSTOMER STORY

chose BlackLine in 2009 to complement its outsourced accounting model. The main reason: BlackLine would bring integration, automation and visibility to the company’s complex array of accounting processes.

Nimmo’s team watches over 200 hotels and about 122,000 accounts and 31,000 reconciliations from offices in Moore, Oklahoma. They were and still are - using an outsourcer, Genpact, for accounting. Outsourcing operations work smoothly, but the hotels were spending lots of time closing books for their monthly handoffs, as well as preparing for their internal and external audits.

“We wanted to get more timely visibility into our operations, particularly the hotel reconciliations,” she says.

Before, Hyatt had to go through Genpact to see the hotels’ closing status. “Staying ahead of all this was hard because we’d have to rely on reports that could be a half-day behind. So we might end up calling the hotel on an issue that had already been resolved.”

A Variety of Auditors Timeliness was critical for year-end closings because Hyatt’s hotels use a variety of external auditing firms for these. Even the monthly internal closings could be hampered when, in some cases, a hotel might release numbers to the outsourcer before they had been certified by the hotel’s controller.

Nimmo’s group can now monitor the hotels’ financial status in real

Hyatt’s 400-plus BlackLine users work with account reconciliations and

time, and can spot a problem, such as a missed reconciliation deadline, before it happens. Meanwhile, the hotels can work with Genpact through BlackLine, which saves on the many emails, messages, and phone calls they used to need.

Now the hotel uses BlackLine’s approval workflow to certify the task.

Once certified, the account is handed off to Genpact for processing.

“We like the fact that BlackLine won’t let the hotel hand off the task until it’s certified,” says Nimmo. “That’s one of the ways that BlackLine

task management

helps reduce complexity and risk.”

modules. Nimmo

to auditing. She estimates that her team saves more than 700 hours

expects to bring up

as important, BlackLine’s approach to Modern Finance is helping

Journal Entry in the

productive work.

near future.

spend more time on real issues than on mundane tasks,” says Nimmo.

BlackLine is also helping to save time, especially when it comes a year by being able to give auditors direct access to BlackLine. Just employees replace the time they spend on mundane tasks with more “Overall, our process improvements and automation are letting us “This is an important benefit for the hotels. BlackLine lets us take the mundane work out of their hands so they can focus on what they need to do for their customers.”

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BlackLine gives Hyatt a number of automated controls over the accounting process.

An example is BlackLine’s segregation-of-duty control, which is embedded in the approval workflows across all BlackLine modules.

It gives customers the option of mandating that no single person can perform more than one function in the standard approval chain of preparer, reviewer and approver.

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PARTNER SPOTLIGHT

UHY Methodology Uses BlackLine to Bring Process Focus to Clients

T

here’s a reason why Atlanta-based UHY Advisors is one of the leading professional services firms in the field, and why they’ve also reached Platinum Partner status with BlackLine: UHY thinks of financial/accounting solutions in terms of the overall process, and the firm approaches client implementations the same way.

UHY Advisors is an audit, tax, and business consulting company and a member of the UHY International worldwide network. Formed in 2000, UHY Advisors is one of the largest CPA professional services firms in the US. The company became a BlackLine partner in 2006.

“The minute we saw BlackLine we knew it was something special,” says Brad Baer, principal for UHY Advisors. “We saw the automation – of account reconciliation and other elements in the recordto-report process. It was like nothing we’d seen before.”

Baer also saw that BlackLine would help UHY Advisors take a process-centric approach to client engagements.

“Rather than just look at a trouble spot, we like to see the client’s entire process,” he says. “That’s the best way to prescribe a solution that doesn’t just fix the initial problem, but produces long- term improvement.”

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Reviewing Balances UHY’s methodology begins with a balancesheet review, then goes to an examination of accounts to find what data, ERP systems and subsystems drive the accounts.

“We’re asking detailed questions, but we’re also looking at the overall process,” says Baer.

“Like, what are the business processes, and what specific problems does the client need to solve?

“For instance, one company was using an ERP system for the balance sheet. We asked how

seamlessly across all modules. That gives UHY an end-to-end view for using root cause analysis and other process-improvement tools.

The unified code base also lets UHY help companies overcome some of the limitations of their ERP and other enterprise systems.

Overcoming Limitations “There are three basic technologies that you see in enterprises,” Baer says.

“You’ve got ERP for the main business

they did cash reconciliations, and they said that

functions, CPM for performance management,

they were automated – meaning, by the ERP

and GRC for governance and compliance.

software. Of course, the term ‘automation’ can

BlackLine performs tasks that are essential to

mean different things to different people.

each one. And because of its unified platform, it

“So we asked what happens when things don’t match, and they said they just dump the exceptions into spreadsheets and do them

makes sure that the core financial information in each is accurate and consistent.”

Maintaining accuracy and consistency is

manually. Then we asked how many of those

challenging to people working with a variety of

were processed manually, and they told us about

ERP, CPM, and GRC applications because those

5,000 – each month.”

systems typically use different databases.

“With BlackLine, you can do account recs

Where BlackLine Fits BlackLine’s process-automation capabilities

and journaling for ERP, financial close reporting for the CPM group, and controls assurance and

are vital to the UHY approach, as is BlackLine’s

transaction matching for the GRC team,” Baer

ease of implementation.

says. “And even though the review workflows

“BlackLine’s core technology is so powerful

are routed from one module to the other, users

that you don’t need custom development,” says

know they’ll all be getting data and reports

Baer. “It’s all in how you configure the system

based on a single set of data.”

out of the box. Want to upload balances? Just use the import templates.

“This means we can create, test, and iterate solutions for clients at a speed that’s uncommon in the enterprise software space.”

Perhaps most valuable to UHY’s processcentric approach is BlackLine’s core platform, which features a unified code base. Thanks to its unified platform, BlackLine’s workflow, transaction-matching and other functions work

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GARY SIMON

What’s in a Cloud? End-toEnd Support for Financial Processes, To Start Analyst Gary Simon explains why the cloud is uniquely suited to integrating and automating the many steps required in modern-day closings

O

ver the last decade the financial close process - which runs from period close in subsidiaries through to electronic filing to regulators - has been continuously stretched by regulation, broadened information needs, and increasing business complexity. But financial close applications have hardly changed, and this has created large gaps in functional capability and process support, most notably around account reconciliations, task management, transaction matching and even journal entry.

Some of these needs have been met by software vendors on a piecemeal basis, but smart CFOs know that straight-through processing - getting everything right the first time - requires end-to-end process support. Without such support, and as a result of the shortcomings in the process, business analysis and decision-making, which rely on effective financial close management, remain fraught with difficulty for many organizations.

Cloud Platforms Emerge For these organizations, however, there is good news. The advent of the cloud, along with cloudbased financial control and automation platforms, is making it possible to bring together essential accounting components into a single sharable environment. Here, applications are built to a common design standard and they can share cost centers, accounts and other metadata, as well as security, user set up and user interface.

The scalability, immediacy and accessibility of cloud platforms such as BlackLine enable all parts of the organization to enjoy access to whatever functionality is needed, regardless of where it may reside. This brings distinct benefits to the financial close, where there is a need for: •

Accounting processes and workflows that can reach out across the organization with high user participation;

•

Management to have complete, on-demand visibility into the process; and

•

Collaboration support among individuals within and between business functions.

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Promoting Collaboration Collaboration among users is essential to helping finance processes evolve from the past - in which close tasks were handled sequentially - to where many key processes can be managed in parallel.

This allows the finance function to take care of a significant number of account reconciliations outside of the critical path of the close, rather than in the middle of it, which is a traditional way to handle reconciliations.

And it’s not just balance sheet account reconciliations that can be shifted off the critical path. It is also possible to bring forward detailed transaction matching and journal entries, which play essential roles in close tasks for subsidiaries and the corporate center.

Cloud-based task management allows the tasks and issues that are intrinsic to the financial close to be maintained in a central and secure environment. These tasks include everything from audit evidence and management commentaries to externally generated documents such as balance confirmations, compliance sign-offs, checklists of close tasks, and regular instructions And embedded workflows allow tasks to be routed among the different users in a process chain. This can be done to obtain a compliance approval, to escalate an issue to a supervisory level, or simply to invoke the next stage of the process. Linked to email and alerting systems, including mobile devices, such workflows give organizations the means to expedite the close process while maintaining appropriate levels of control.

Once tasks are accessible in a single shared environment they become visible to authorized users anywhere in the process. Their status can be captured, thanks to the integrated workflow, and they are open to measurement. A rich repository of performance built up over time and embedded in the application helps identify whatever delinquent tasks might hold up the overall financial close, making it easier to take care of them earlier in the process.

A Way Forward With the increasing pace of market, regulatory and technology activities, there’s every reason to expect that the financial close process will continue to become more complex and challenging in the years ahead. That’s why the shift to digital technologies and the emergence of cloud-based financial controls and automation platforms is so important: it provides a step-change in capability and a dependable way forward for process improvement.

Gary Simon is group publisher of FSN Publishing Limited and leader of the Modern Finance Forum on LinkedIn. He is a graduate of London University, a Fellow of the Institute of Chartered Accountants in England and Wales and a Fellow of the British Computer Society. Simon has authored four books, and is a leading authority on finance and technology.

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TIPS & TRICKS

Play from the Same Sheet Problem Whether gathering tables of transactional data or executing formula-heavy reconciliations, accountants love the power and familiarity of spreadsheets. But spreadsheets are often used by different people, and this can lead to multiple versions being emailed back and forth, and that can lead to critical errors…not to mention the time and costs wasted in trying to recover.

Solution BlackLine’s new Integrated Spreadsheet function now lets you open a spreadsheet from within the Account Reconciliation module. Select the Worksheet with Calculated Balance command to display a fully functional spreadsheet that’s integrated with BlackLine’s unified platform, so the changes you make will be automatically reflected in all other related modules. You can build a spreadsheet from scratch, or you can import your existing spreadsheet into BlackLine to get started.

Drilling into ERP Problem You’re trying to reconcile a monthly general ledger account from your SAP ERP system, but the account isn’t reconciling and you can’t figure out why. You suspect that some transactions in transit haven’t been accounted for, so you need to dig into the ERP system. But you’re under a tight deadline. You don’t want to waste the time to open a new browser tab, log in to the ERP system, find the account, adjust for the time period, and hunt for the missing transactions.

Solution With BlackLine’s ERP Drill Down function you just click the ERP system’s hyperlink, which is displayed in your account reconciliation page right next to the GL Balance. The link jumps you straight into the details of the account, for the period you need. If you haven’t yet logged in, you’ll be asked to sign into your ERP system as you normally would – BlackLine doesn’t store these credentials – then you’ll be taken to the general ledger account.

Your system administrator typically sets up the link - or links, if you have multiple ERP systems – by going into ERP Drill Down Settings to build a link to each ERP system. Once that’s done, your organization’s preparers, reviewers and approvers can see a link back to the specific account in question any time they reconcile an ERP account.

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ISSUE 1 - DECEMBER 2015

Under Armour runs on SAP速 software and closes with BlackLine.

BlackLine Financial Close Suite for SAP Solutions is an SAP-endorsed business solution.

BlackLine helps businesses reduce risk and increase the efficiency of the financial close. It offers one of the SAP-endorsed business solutions that are complementary to SAP software offerings. See why hundreds of SAP customers trust their financial close to BlackLine at BlackLine.com.

ISSUE 1 - DECEMBER 2015

BLACKLINE MAGAZINE | 41