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News < Back Sarbanes Oxley : Finance : Sarbanes Oxley A New Magnitude
However, Ventana Research advises companies to take a close look at their incumbent system to be certain their package(s) will enable them to support business initiatives such as accelerating their accounting close, broadening the scope of information used in management reporting, increasing sustainable compliance efficiency and cutting operating costs. Assessment Cartesis has released the latest version of its consolidation and reporting software package, ES Magnitude, into general availability. The company?s intent was to build on the previous version's strength ? its ability to address the needs of very large organizations ? while designing in enhancements that should make it attractive to a wider set of buyers. Magnitude already appealed to companies that needed support for large data sets, multi-GAAP, multi-currency, multi-language and complex ownership characteristics. By making fundamental changes to the software, it has made deployment easier, increased user productivity and supported a wider range of process improvements that will increase the effectiveness of the finance organization. In this latest release, Cartesis sought to substantially reduce the resources and time required to deploy the software. The latest release also supports a hierarchical chart of accounts and reporting unit hierarchies, and it incorporates sets of built-in roll-up rules to simplify deployment and maintenance. To help manage the period-end process with greater control and flexibility it added consolidation workflows and enhanced to the capabilities of its consolidation locking and sub-consolidation controls. Sarbanes-Oxley Section 404 has increased the importance of recording and tracing an audit trail in a compliance-sensitive area such as consolidation, and ES Magnitude has improved this capability as well. Our recent research study on financial reporting and consolidation revealed a majority of companies wanted to accelerate their accounting close, and that shortening this process was important to them. They also believed automating more of the closing process by eliminating manual steps, would speed the process. We advise corporations to look at all approaches to accelerate their monthly or quarterly closing. Companies required to file statements with the US SEC have had to deal with shortened filing deadlines and increased scrutiny of their accounting before they file. Speeding the purely mechanical steps enables finance, senior executives and audit committee members (now usually non-executive directors) more time for review. Companies using an older consolidation software package or those that now incorporate manual steps (e.g., for reconciliations) and/or use spreadsheets in their close should consider modifying their methods to automate as much of the process end-to-end as possible. If their existing IT systems cannot support this, we think they should replace the components preventing them from doing so. Similarly, we advise organizations to find ways to improve the efficiency of the management and statutory reporting functions. Market Impact Ventana Research concludes that ES Magnitude?s functional improvements and faster, easier deployment, coupled with increased sales and marketing investment in North America, will enhance Cartesis?s ability to compete in the market. Hyperion has been able to maintain a lion?s share of the consolidation software market ever since it introduced Micro-Control in the mid-1980s. We believe Hyperion?s strength stems from having focused on the needs of the broadest swath of companies and from maintaining a brand-name franchise in the switching-averse finance department. Competitors such a Cartesis and Longview responded by addressing the needs of the largest and most complex organizations. Having addressed the product issues that made it difficult for Magnitude to compete down market, Cartesis must leverage its investment in its North American field organization to raise its profile in this key market. In addition to Hyperion, we also see the company coming up against Cognos, whose strategy has been to increase its penetration of the Performance Management software market by focusing on increasing sales to finance departments. To that end, last year Cognos acquired Frango, a consolidation software company based in Sweden, in order to replace its previous consolidation software offering which, in our view, was a substantially weaker product than Frango. Recommendation Although most companies have addressed many of the significant issues that prompted them to invest heavily in reporting software, our research finds there is still much to be accomplished in improving management reporting efficiency, speeding the closing process and increasing the controllability of key parts of their accounting cycle. Ventana Research thinks many larger corporations that have issues with their older or more fragmented consolidation software systems will benefit from investing in systems upgrades and from rationalizing processes. We advise companies with more than 1,000 employees to assess whether their current systems are falling short, and if they are, to include ES Magnitude on the list of solutions to consider. Ventana Research is the preeminent research and advisory services firm helping our clients maximize stakeholder value with Performance Management throughout their organizations. Putting research in a business and IT context we provide insight and education on the best practices, methodologies and technologies that enable our clients to leverage assets to understand, optimize, and align strategies and processes to meet their goals and objectives. 
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