A highly customized system meant continuous breakdowns
Logitech’s consolidation system was unreliable and lacked the required capabilities of a global company. Extensive manual work became necessary to complete the close process putting pressure on their ability to hold timely earnings calls. Archetype was selected to implement Hyperion Financial Management. The project exceeded expectations and delivered benefits to all levels of the organization.
Logitech’s previous consolidation system was not reliable. It was a highly customized system and the only support available was from one independent consultant in the U.K. With continuous breakdowns, there was a constant risk of not being able to close the books.
In addition, Logitech’s business model calls for supplementing internal product development with a combination of strategic acquisitions and industry partnerships. Supporting the company’s expanding operations was becoming more complex and time-consuming. The finance team struggled to manually reconcile intercompany balances as the number of entities continued to increase. With over 30 active currencies, management wanted currency translation adjustments (CTA) analyzed at the account level. They really needed a new system to process financial results quickly and accurately and provide better drill-down capabilities to support detailed reporting and analysis.
After a thorough evaluation process, Logitech selected Hyperion Financial Management for its strong functionality and proven stability, and Archetype for their expert guidance and implementation services. The recommended solution involved creating two applications – one to handle monthly consolidations and reporting, and one to manage foreign currency exposure.
- The Monthly Consolidation application performs consolidations and intercompany eliminations automatically. It includes both legal and management reporting structures to provide internal and external views of the company. A dynamic set of core financial reports can be generated at the regional or group level, including automatic production of cash flow statements.
- The Foreign Currency Exposure application measures the company’s worldwide foreign exchange exposure in the balance sheet at the end of each period.
In approximately five months, Archetype successfully completed the project on time and under budget.
Executives were impressed with the on-time and under budget results. Working side-by-side with Archetype consultants, Logitech’s project team achieved measurable benefits for all levels of their business.
- Leadership has confidence in the numbers and touted the new system to the audit committee and at a company-wide employee meeting. With the speed and accuracy of the new close cycle, Logitech has accelerated the timing of their quarterly earnings announcement. In addition, the project has created dollar savings by eliminating the need to purchase a separate foreign exchange system.
- The corporate finance group was recognized for completing a worldwide consolidation by Day 3 of the Close. Automating currency translation, intercompany eliminations, and multi-level consolidations have improved the productivity of the group. Since the regions now take responsibility for their own numbers, the corporate finance team can focus on analyzing results instead of just reconciling data.
- Regional finance groups are also more productive. They can enter data and review results as needed, without waiting for the month-end corporate close cycle. Because they now have visibility of intercompany balances in other region’s books, they can identify and resolve issues immediately.
- Comprehensive training gave end-users the confidence to master the reporting tools and get the information they need. The use of Hyperion Reports, Analyzer, and Excel Retrieve has replaced schedules prepared manually in the past.