Open Chart Surgery

Redesigning your chart of accounts as part of a financial transformation programme is a risky and expensive endeavour. Whether you are looking to standardize and optimise your business processes or improve your financial reporting, the impacts of changing the core structures that underpin your financial applications can be wide ranging.

Open Chart Surgery

Why undertake Open Chart Surgery?

Financial transformation initiatives tend to arise when financial structures and applications have become unwieldy through uncontrolled change. Whether you have grown by merger and acquisition, organic growth or simply need to redesign your chart of accounts to better support your strategic direction, it is imperative that you understand the key risks associated with transformation and how our approach mitigates those risks.

Key Risks

  • Business Engagement – All areas of your organization will have specific needs which need to be addressed as part of the redesign process. Without careful management and the right tools, this can become a highly iterative process which results in an aggregated, not standardized, set of structures.
  • Chart Validation – Management rarely have confidence in the new chart until they understand the impact on their key reports and month end processes. Many financial transformation and chart redesign methodologies depend on expensive trial conversions to make this information available.
  • Change Management – Your existing chart of accounts will continue to change during the CoA design and conversion process. This creates a challenging master data governance problem as master data created during this period needs to be extracted and included in the design process. Likewise, managing multiple versions of your new chart and its associated report definitions and mapping files can be difficult if you are not using a formal master data management solution.

Common Pitfalls

  • Treating accounting policies and practices as an afterthought – Many organisations only consider accounting policy very late in the project cycle. However, even a small accounting policy change can have a fundamental impact on your standard chart of accounts and all dependent applications. Accounting policy should be the first consideration, not the last.
  • Defining code logic before understanding reporting requirements – Reporting requirements should always be understood prior to defining the code logic. After all, the purpose of your new chart is to ensure that you can provide management with the accurate numbers to help drive your business forward.
  • Big Bang doesn’t work – Coping with the impact of change on your budgeting and consolidation systems is one of the major challenges of a chart conversion. A common pitfall is to attempt to change your chart in your ERP and EPM applications at the same time. This greatly increases the complexity of your initiative, puts increased pressure on your project resources and can create a highly iterative chart design process. Changes required to meet planning requirements drive changes to the chart design and vice versa. This is a difficult cycle to stop and will prove expensive and frustrating.

Our Approach

We use secure, multi-user, fully audited master data management application to allow your users to model and understand the proposed changes. We read your current structures, model your new chart and store the mappings between these two views. We then use powerful analytical tools to allow your team to report your current numbers on the basis of your new chart giving you the clarity that the new chart will work for your organization

Systems Health Check

Get our experienced consultants to review your approach, tools and processes that underpin your financial reporting

Get in touch