Excel spreadsheets are the most popular tool used by financial personal for performing reconciliation. Though excel provides many functions and formulas to perform reconciliation, collating the data from the source system to excel and performing the account reconciliation has always been a herculean task to perform.
The financial numbers that are published by any regulated or listed organization need to be accurate because these can influence the decision-making by the shareholders or its customers. When the finance controller or the CFO signs on the financial reports being published, they need assurance that the numbers are as accurate as they can be. From the auditor’s point of view, they should be able to go to historic financial numbers that were published and perform their inspection to ensure the right controls were in place in a manner to ensure that the financial numbers were accurately published.
A typical large organisation has a lot of source systems that have the data eventually flowing into the accounting system and hence posted into General Ledger(GL). Security is important in this case when the reconciliation is done because it ensures that the numbers have not been tampered with when they are being compared between the source system and the GL. Oracle EPM has a module called ARCS that provides such a platform to do these reconciliations in a manner that is acceptable by both internal and external auditors. The Oracle ARCS tool also has a data integration platform which allows you to automate bringing in data from different sources and it has pre-built connectors with Oracle Fusion General Ledger to bring the balances from the Oracle GL Essbase cube along with capabilities to perform data mapping, defining hierarchies, thresholds which enable doing reconciliations at different levels.
The reconciliation tasks when done manually also lead to storing confidential financial data to multiple shared drives as per the process owner’s convenience/practice or access availability. Only the person responsible with the activity & reviewer (if any) knows the path or location of such working files. Files end up being saved on different intranet and local storages with different naming conventions making it difficult to track and ensure data security of data.
The data stored in discreet location across multiple files often lead to security breaches and compliance failures.
Ensuring Data security and compliance throughout the reconciliation Process:
- Reconciliation requires data from multiple source systems has to be exported to a central location
- The data security access to this exported should be in line with the source system data security access
- once the reconciliation is completed the data should be properly archived or purged
Automated Reconciliation through Oracle ARCS
Oracle ARCS is a unified platform for catering to all reconciliation activity. It will act as a single repository for all reconciliations across an organization. Through automated reconciliation tools the data to be reconciled can be centrally stored, reconciled and secured with proper data access to approved personals as per the data security rules defined in the source systems.
Benefits of using Oracle ARCS
- Oracle ARCS tool will act as one stop for everyone in the organization who need to proceed with reconciliations. There is no need for the storage of data at multiple drives as data gets stored at this single repository when the data sources are configured into the system. Also, the output i.e. the reconciliations are also stored in the ARCS tool and one does not need to save them locally. It can even be reconciled directly from the tool
- ARCS tool uses logics or criterions that we define into the system to set the naming patterns for reconciliations. For example, we can define business segments and account ID’s and configure uniform naming of reconciliations based on combination of business segments and account.
- We could configure macro level data sources in ARCS tool and perform reconciliation on more aggregate level like an organization. For example, instead of reconciling accounts receivables at business segments or units we could reconcile it on an organization level and reduce unnecessary granular activity or efforts duplication.
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