FinanceMay 28, 2024

The scope of the financial close has expanded. Here’s how we’ve enhanced CCH Tagetik to help you cope.

In this article, we'll explore changes in financial close and consolidation processes, delve into the new data requirements, and examine how CCH Tagetik enhances the scope, speed, and accuracy of the close and consolidation tasks. 

The scope of the financial close has expanded — and legacy consolidation systems aren’t keeping up.  

Comparing today’s enterprise financial close and consolidation process to processes ten years ago is like comparing Amazon Web Services to a floppy disc. Just as a floppy discs storage capacity is a fraction — of a fraction of a fraction — of Amazon’s cloud capacity, the close processes of the past required a fraction of the data needed today.  

With requirements only intensifying, traditional close systems are going the way of the floppy disc: extinct.  

The good news is CCH Tagetik has augmented the close's scope, speed, and accuracy with advancements to the tech behind its close and consolidation solution. In this article, we’ll discuss: 

  • Financial close and consolidation processes: What’s changed? 
  • New data requirements in the financial close   
  • How CCH Tagetik augments the scope, speed, and accuracy of close and consolidation 

Financial close and consolidation processes: what’s changed? 

In the 2024 Magic Quadrant for Financial Close and Consolidation Solutions, Gartner wrote, “Driven by increasingly complex company structures, evolving financial regulations, and multiple systems of record as well as the rise in remote working, organizations now need more efficient, compliant, and collaborative management of their financial close and consolidation processes.” 

There was a time when closing and consolidating the books meant just keeping on top of financials, but today’s end-to-end close and consolidation process accounts for processes that extend beyond close management and consolidation. In addition to financial statements, teams must close the books on data related to: 

As a result, we can now place financial close’s many moving parts into two categories: 

  1. Standard close and consolidation processes: Close management, financial consolidation, financial and management reporting
  2. Extended close and consolidation processes: Account reconciliation, transaction matching, ESG, lease accounting, insurance accounting, tax provision and reporting, integrated disclosure 

Traditionally, close and consolidation solutions only supported standard processes. But to adequately cover today’s end-to-end close and consolidation needs, solutions must provide functionality for everything that impacts actuals data — including extended processes.  

New data requirements in the financial close   

Financial close data used to originate solely from ERPs and various CSV files. But now, closing the books requires information from HR systems, data warehouses, tax systems, treasury systems, supply chain systems, commercial systems, and even EHS, carbon, and emissions systems. It’s not just financial data that’s required, but transactional, lease, insurance, HR, commercial, supply chain, tax, and ESG data too.  

This influx of diverse unstructured data poses challenges to the close and consolidation systems many teams use. FSN’s CEO, Gary Simon, explains, “Data management is becoming the pre-eminent concern, and legacy consolidation systems designed around the capture of monthly balances are ill-equipped to deal with the complex data demands of the modern era.” 

The problem with inadequate financial close systems 

Finance has reached an inflection point. Consolidation systems must change to accommodate enormous volumes of granular data across the organization. ERPs, spreadsheets, and point consolidation systems — or a combination of the three — have been the systems of choice for completing some or all financial close and consolidation tasks. But these traditional financial close systems are falling short. Here’s why.  

  • They’re rigid. Traditional approaches to close and consolidation put users into a box: the systems do what they do, and no more. Any customization required to accommodate new accounting, regulatory requirements – like ESG, tax and integrated disclosure – or business requirements — like M&A, divestitures, new products, or geographical expansion — must be coded or completed in yet another add-on system. They're not flexible, scalable, or agile.  
  • They’re limited. Meeting today’s monthly close requirements is no longer just a matter of consolidating financial data. It’s managing terabytes upon terabytes of disparate financial, operational, ESG, and tax data while connecting an ever-growing volume of different processes together. 
    Data requirements have exited the domain of the spreadsheet and entered the realm of generative AI and machine learning — but spreadsheets, ERPs, and point systems can’t expand to employ these technologies at the level finance needs. AI-autofill and suggestions are a nice touch, but they’re not enough for finance teams dealing with enterprise CPM needs.    
  • They’re siloed. Traditional approaches break up close and consolidation processes into remote islands, when these processes should be city centers of collaboration and connectivity. Close processes are completed at many levels of the organization — account, entity, and group levels, for example. When workflows are broken up by the systems and documents that make up each task, there’s no critical path between these close activities. 

What’s more, without adequate visibility into downstream processes where data is collected and validated, problems can arise when the data is subsequently merged and consolidated. This lack of traceability of the information often leads to delays in the close process and the need to carry out last minute manual interventions in the data and a lack of full trust in the values being reported. 

Financial Close & Consolidation
Manage your financial close and consolidation with CCH Tagetik's software from local close to group consolidation to regulatory reporting and disclosure.

CCH Tagetik Financial Close and Consolidation augments the scope, speed, and accuracy of the close 

CCH Tagetik Financial Close & Consolidation is an AI-based, data-centric solution that expands the core capabilities of close, consolidation and reporting enabling finance leaders to accelerate core close processes while automating close adjacent ones. We built this solution to grow with the close as it becomes more complex. As close and consolidation processes expand to include more data, diversity, and departments, our solution is equipped with the technology to augment and expedite all related tasks.  

How it augments scope 

CCH Tagetik Financial Close & Consolidation centralizes all enterprise data and supports all close processes in an end-to-end platform.  

This includes:

CCH Tagetik conso

While ERPs, point solutions and other consolidation software manage financial data, our solution goes above and beyond standard close requirements covering new operational dimensions and close-adjacent processes, including IFRS and insurance accounting, transaction matching, ESG, tax and integrated disclosure management. 

How it augments speed 

CCH Tagetik Financial Close & Consolidation employs financial intelligence, AI, and machine learning to accelerate the tedious tasks involved in the close.  

  • Our AI automapping automates data collection. It instantly reconciles data from different sources with different dimensionality and in different accounting languages.  
  • Our AI driver-based analysis detects business drivers by connecting the dots within huge data sets to get to the root of what’s influencing performance outcomes.
  • Our AI anomaly detection flags outliers and reasons for the deviation.
  • Our intelligent rules-based approach empowers Finance to tackle complex consolidation and regulatory requirements, significantly reducing implementation time. 

Our AI takes care of repetitive tasks, so your team can focus on higher value work.  

How it augments accuracy 

CCH Tagetik Financial Close & Consolidation is a workflow-oriented solution that employs data governance, audit intelligence, and AI-based automation to reduce human touch points — and human error. Our workflow governs all close processes, so Finance can manage everything from transaction matching to group consolidation to ESG and tax reporting into one unified workflow.  

CCH Tagetik has a consolidation cockpit that manages all data collection and establishes a submission flow which collects, validates, and audits the data from local level all the way to the final consolidated figures. It traces the life cycle of data, ensuring data quality from root to fruit. 

What’s more, administrators have the power to assign tasks to employees, entities, and groups, automate approvals, and track the progress of every task in a real-time dashboard.  

Augment your close and consolidation process with CCH Tagetik 

As Deloitte wrote, “There was a time when keeping on top of your manual entries meant you were on top of your finance information. Then, you switched to local spreadsheets. Then, you started sharing them on a server or the cloud. Evolution in finance data isn’t new; it’s just at a turning point. Getting serious about data is no longer an incremental need for finance. It’s a transformative one — or a reason transformation might fail.” 

The scope of financial close and consolidation has grown — and it shows no signs of stopping. With new data and process requirements come new technology needs. Learn how CCH Tagetik Financial Close and Consolidation is leading the market with its AI-based, end-to-end solution.  

Read the Gartner Magic Quadrant for Financial Close and Consolidation Solutions. 

CCH® Tagetik
Financial Close & Consolidation
With CCH Tagetik Financial Close and Consolidation Software, we manage the complexity so you can accelerate the close.
Back To Top