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Fusion 11.1.1.2, HFM & Reports

Equity Pick-Up module &

Customized Intercompany Matching

November 26, 2009

Evoluon Eindhoven

Using the Equity Pick-Up module and an alternative way of doing intercompany matching in one of the latest releases of HFM. Advantages

and disadvantages for the closing process, the users and the administrators and the impact on the quality of data reported.

Agenda

Introduction of Pearle Europe

Equity Pick-Up in Fusion 11.1.1

New Intercompany matching Process

Questions

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Introduction - Pearle Europe Profile

Professional optical retail company

Started in 1996 with the acquisition of Pearle Netherlands

Since 1996 the Group has entered new (European) markets

every year through the acquisition of strong, local retail formats.

Present in 27 countries and 4 continents

Stores: 2,750 optical retail stores (of which 25% franchise)

Sales: over € 1,5 billion in 2008.

FTE’s: 10,400 across Europe.

Main shareholder: HAL, which is listed at Euronext

Apollo: Germany

Pearle: 1 of 2 brands in the NetherlandsSynoptik: brand in DK & SW

Avanzi: Italy

Brand examples

Pearle Group Accounting targets / strategy

Save time on reporting data (Users & Administrators)

Improve quality of data

More focus on data analysis

Extend the use of management reporting in HFM

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Focus of this presentation:

Equity Pick-up

Intercompany Matching

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Pearle’s Equity Pick-Up in HFM v3.4

Equity Pick-up in (Sub) calculation rules

Time consuming manual calculation/translation/consolidation

procedure for consolidation from bottom to top level (hours)

Static solution

Extensive code in rules (> 1000 lines)

Poor maintainability

No transparency

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Output

Investment of Holding equals Equity of Subsidiary

Result Participations equals result of subsidiary

Input

Shares

Exchange rates

Multiple Equity/P&L accounts

EquityPickUp routine

Runs for all entities with shares in subsidiaries

Source and destination accounts can be chosen

EPU Calculations can be a automatic booking or a correction

Equity Pick-Up Module – requirements

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Dynamic Just 100 lines

of code

assets Subsidiary eq/liab

… Income o/t yr 500

Equity Pick-Up calculations – An example

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assets Holding eq/liab

Investm inc 500

Investm inc cta … Income o/t yr 500

Investm div …

investm …

Holding P&L

Result Subs 500

EPU rules

Standard rules

Equity Pick-Up Module – The process

1. Load Data 2. Run EPU

3. Check Results

Without details

which are

calculated by the

EPU routine

Takes a few

seconds

Customized report

displays all EPU

calculations along with

shares %

Transparency

Speed

Consolidated Holding Sub

EPU - Report

Investment in group

companies =

Equity * % shares owned

% shares owned by

Holding

Questions

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Intercompany Matching (ICM)

Need for more transparency and flexibility

Better high level overview of intercompany bookings

Higher quality of data

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ICM routine

All entities must load data

All entities must be calculated (or consolidated)

Details can be checked ICM Report

Differences will block Process Control

New Intercompany Matching (ICM)

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Preparations

Create metadata to store ICP counterparty details on own entity

Create section in calculation rules to populate ICM accounts

Create a report (in Fin Reports) to display all ICM amounts

Intercompany Matching – The process (1/3)

5. Check ICM report

Customized

report displays all

Intercompany

matching

bookings

4. Run Calculations/Consolidation

ICM could be before or

after EPU, but always

after Data load of all

entities

IC amounts of other entities

are pulled to own entity

1. Load Data 2. Run EPU

3. Check Results

Without details

which are

calculated by the

EPU routine

Takes a few

seconds

Customized report

displays all EPU

calculations along with

shares %

Intercompany Matching – The Report (2/3)

ICP A

ICP B

ICP C

ICP A

ICP B

ICP C

Intercompany Matching – The Report (3/3)

All empty lines are

suppressed

Differences in red exceed

the limit and will block

approvement of data

Left column:

Receivables

(of IC party)

Right column:

Payables of

own entity

IC party

New Intercompany Matching (ICM)

More transparency

Better high level overview

Higher quality of data

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Questions

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