Optimizing Enterprise-Wide FP&A to Drive Value for PE-Owned Manufacturer
Project Type: Financial Planning & Analysis, Financial Data Scrub, Financial Statement, Financial Reporting, GAAP, Corporate Financial Planning & Analysis, Financial Reporting, Process Standardization
AMEND was sought out by U.S. based manufacturer, backed by a Manhattan-based Private Equity group with $5 – 6 billion AUM, primarily focused in middle market specialized manufacturing companies, to consolidate and automate financial reporting across all locations and brands within one of their companies.
Our initial assessment found a corporate environment plagued by siloed, inconsistent accounting practices, and financial reporting that was unreliable and inconsistent. Overwhelmingly manual processes led to reporting delays and errors, creating significant risk and an unpredictable financial standing. Our goal coming in was to standardize and align financial data and reporting practices across the company’s sites, and to provide the holding company with clear, correct, real-time financial information at both facility and consolidated levels.
- Leading multi-site specialized manufacturer going to market with 10+ commercial brands
- Headquartered in the Midwest with facilities across the country and into western Europe
Assessing the Landscape
- Our initial review disclosed that each independent site had its own financial processes, reporting, and timelines. Each site adhered to its own Month End Close schedule, performing overwhelmingly manual Finance and Accounting responsibilities that did not result in uniform or consistent reporting. The manufacturer was left unable to assess consolidated performance.
- Disparate data systems delivering siloed financial reports without possibility of rollup
- Manual, non-standardized accounting practices, slowing down Close process and increasing overhead costs
- Financial data delivered inconsistently and delayed, hindering decision making process for leaders as they lacked important information about drivers behind the company’s position
I. The Solution
Addressing the Root of the Problem: Introducing Standardization and Replication
The AMEND team began by assessing daily Finance and Accounting transactions throughout the company, developing a plan to standardize these transactions and allow for consolidation across sites and brands. Progressing through General Ledger accounts, we established a consistent GL and aligned each level of the company on a path that would allow for portfolio-level financial analysis, reporting, and success.
Through deliberate ground-level work and relationship building, our team developed an intricate understanding of the unique functions, metrics, and financial data flowing through each site. Establishing advanced financial reporting capabilities requires a solid, central foundation for Finance and Accounting functions. We built this foundation while preparing the company to take advantage of more sophisticated budgeting, forecasting, and problem-solving that would stem from reliable FP&A processes and reporting.
Providing a Real-Time Answer to the Question: “How are we doing?”
Prior to AMEND’s involvement, the Finance and Accounting teams created site-specific monthly reports from scratch, requiring months to evaluate and share results. Leaders attempting to understand the financial position at the brand, holding company, and/or portfolio level were left without a clear and timely answer. Finance and Accounting teams were overstretched and piecing together whatever data they had manually each month, leading to staggering overhead costs without a clear justification.
After building a foundation for Finance and Accounting processes, reporting practices, and GL accounts, we began assembling and circulating financial reports which could be replicated, so that each facility would be reviewing and comparing its financial data against consistent criteria. This allowed leaders to access a real-time, reliable snapshot of the financial standing at both the individual facility level, and for the consolidated holding company.
Our team has created a wide variety of reporting packages for leaders across the businesses. Our reporting packages span the following topics, and beyond:
- Budget vs. Actual
- Forecast vs. Actual
- Full Financial Statement packages (Balance Sheet, Income Statement, Statement of Cash Flows)
- Sales Expectations, Bookings, and Trends
- Operation reports and dashboards displaying financial Key Performance Indicators
Universal Financial Optimization
AMEND has led a complete renovation of Corporate Finance and Accounting departments and has developed clear financial reporting packages for a variety of levels.
Building Confidence, Ensuring Accuracy
Company-wide data scrub and validation for years of financial results that improved decision-making across the board through increased confidence in numbers.
Improving Turnaround, Streamlining Overhead
The Month-End Close timeline has dropped from an average of 10 days to a hard scheduled ending at 5 days, and headcount to achieve Close has dropped by more than 1/3 from pre-AMEND involvement.