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Project Information

ResponseProject NameOrganization NameRegionCountryScope of ProjectDivision/Regional Entity (if any)IndustrySub IndustryCurrencyRevenuePeriod end date for data provided

Copyright SAP. All Rights Reserved

F22

Format: DD/MM/YYYY

Financial Performance and Risk Management: Survey Instructions

Survey Structure

Welcome to the SAP Financial Performance and Risk Management (FPRM) Benchmarking survey. The survey will help you assess your organization's current FPRM process and technology performance, based on key performance indicators and best practices vis-a-vis your peers. The assessment covers all core FPRM processes including Compliance and Risk Management, Budgeting and Forecasting, Business and Operations Analysis and Reporting, G/L and Financial Closing and Cost Accounting and Analysis.

Knowing your strengths vis-a-vis peers, and identifying potential improvement opportunities will help you position your organization for growth and profitability. Upon submission of this survey, you will receive a confidential and comprehensive analysis report, comparing your organization’s performance against your peers, and recommending high-impact strategies for improvement. Here are a few tips before you get started

The survey has three pages:• Page 1 includes general instructions.• includes participant profile, key performance indicators and information technology deployed.• Page 3 includes a series of best practices along with their maturity models to help you to assess their importance and adoption/coverage for your organization.• Maturity Model includes descriptions of maturity stages for each best practice listed on Page 3. They should be used as a gauge for best practices Coverage (1 - 5)

Completion Instructions:

Terms and Conditions


• An online glossary is in place to address the most common questions. The glossary can be accessed by clicking on the “Help” button.• Please provide all data for the timeframe you indicated in the project set up which should be preferably rolling 12 months and based on most recent annual figures. ONLY for the divisions/ geographies in scope.• In case a question with a numeric answer is not applicable for your organization or in case you cannot answer a question, please leave the answer field blank and do not enter ZERO (“0”).• For % responses, please indicate numbers only without the “%” sign (e.g., 20, NOT 0.2 or 20%).• All financial data needs to be provided in SELECTED CURRENCY only, unless otherwise mentioned.

By your entering of data into this survey, you are indicating your agreement with and acceptance of the terms and conditions associated with SAP’s Benchmarking Program

Click here to review the Terms and Conditions

https://valuemanagement.sap.com/HtmlPages/TermsAndConditions.html

Financial Performance and Risk Management: Participant Profile

1 Please provide the following basic financial and operating information.

Metric

Credit Rating - S&P Rating (Help)

Financial Performance and Risk Management: Key Metrics

2 Please provide the following Compliance and Risk Management related metrics.Metric

Manual Tested Controls (% of total controls) (Help)

3 Please provide the following Budgeting and Forecasting related metrics. Metric

(Help)

4 Please provide the following Business and Operations Analysis and Reporting related metrics. Metric Avg. Days to Create a New Report with No Previously Defined Report Template (Help)

Annual Revenue Growth (in %) Number of Employees Cost of Goods Sold Selling, General and Administrative Expense Operating Income Days Sales Outstanding Avg. Annual Inventory Days Payable Outstanding

Cost of Capital (in %) Total External Audit Cost Incurred Total Number of Controls (IT and business)

Avg. Cycle Time for Creation of Forecast (in days) Forecast Accuracy (in %)

C19

Basic Financial and Operating Information: Please provide all company information for the geographies or divisions you included in the scope of the survey only. Example: • You are completing the survey for a North American subsidiary of a global company • The global company has revenues of $30 billion, whereas the North American subsidiary has revenues of $13 billion • In the revenue field, $13 billion should be entered 1. Annual Revenue Growth (in %): This is the % growth in revenue for the organization in the last 1 year 2. Number of Employees: Includes all Employees on the payroll of the company/BU for which the survey is being filled e.g. You are completing the survey for a North American subsidiary of a global company. The global company has 50,000 employees with revenues of $30 billion, whereas the North American subsidiary has 10,000 employees with revenues of $13 billion then in the employee field, 10,000 employees should be entered. 3. Cost of Goods Sold (in selected currency): The amount of direct materials, direct labor, and allocated overhead associated with products sold during a given period of time, determined in accordance with “Generally Accepted Accounting Principles” (GAAP). 4. Selling, General & Administrative Expense: Cost of salaries, commissions, travel expenses, advertising expenses, and administrative expenses related to selling products/ overall administration of the company. 5. Operating Income: Revenue - Cost of Goods Sold - Selling, General & Administrative Expense - Depreciation - Other Operating Expenses 6. Days Sales Outstanding (in days): A measure of the average number of days that a company takes to collect revenue after a sale has been made. A low DSO number means that it takes a company fewer days to collect its accounts receivable. A high DSO number shows that a company is selling its product to customers on credit and taking longer to collect money. Days sales outstanding is calculated as: Accounts Receivables/ (Total Credit Sales / Number of Days) 7. Days In Inventory (DII) (in days): This is an efficiency ratio that measures the average number of days the company holds its inventory before selling it. Days in inventory is calculated as: Average Inventory / (Cost of Goods Sold / Number of Days) 8. Days Payable Outstanding: This refers to your company's average payable period. Please use 360 or 365 days as the number of days in your calculation. Days Payables Outstanding is calculated as: Accounts Payable / (Cost Of Sales / 365). Please note that the formula may also be written as: Accounts Payable / (Cost of Sales/ Number of Days) 9. Credit Rating: The credit rating of a corporation is a financial indicator to potential investors of debt securities such as bonds. These are assigned by credit rating agencies such as A.M. Best, Dun & Bradstreet, Standard & Poor's, Moody's or Fitch Ratings and have letter designations such as A, B, C. Please provide the rating assigned by Standard & Poor's rating (from excellent to poor: AAA, AA+, AA, AA-, A+, A, A-, BBB+, BBB, BBB-, BB+, BB, BB-, B+, B, B-, CCC+, CCC, CCC-, CC, C, D).

C29

1. Cost of Capital: Cost of capital is the cost of obtaining funds. It is calculated as the weighted average of the costs and proportion of financing, including both debt and equity. By taking a weighted average, we can see how much interest the company has to pay for every dollar it finances. 2. Total External Audit Cost Incurred: Annual fees paid for periodic audits conducted by external (independent) qualified accountant(s) to determine whether the company's accounting records are accurate and complete, comply with regulations and fairly represent the organization's financial position. 3. Total Number Of Controls (IT And Business): Controls are a specific set of policies, procedures, and activities designed to meet an objective. A control may exist within a designated function or activity in a process. A control’s impact may be entity-wide or specific to an account balance, class of transactions or application. Controls have unique characteristics – for example, they can be: automated or manual; reconciliations; segregation of duties; review and approval authorizations; safeguarding and accountability of assets; preventing or detecting error or fraud. Controls within a process may consist of financial reporting controls and operational controls (that is, those designed to achieve operational objectives). (Source: SEC Interpretive Guidance http://www.sec.gov/rules/interp/2007/33-8810.pdf) 4. Manual Tested Controls As A % of Total Controls: The specific set of policies, procedures, and activities designed to meet an objective, when executed manually are termed as Manual Controls. E.g.. functions such as the authority to initiate and execute a transaction and the recording of the transaction, are assigned to different departments or to different individuals within the accounting department. Calculation: Number Of Manual Controls / Total Controls * 100.

C35

1. Average Cycle Time For Creation Of Annual Forecast (in days): Number of days required to create annual forecast, from target and goal setting to simulations to sign off by individual business segments until final submission for approval. This should reflect the elapsed time (start of process to finish), not man days (effort). 2. Forecast Accuracy: Please provide accuracy of forecast for your operating results (revenue and operating margin) across the past 4 quarterly forecasts, assuming constant currency. For example, if you missed your forecast in the first quarter by 5%, met the forecasts in the second and third quarter, and exceeded your forecast in the last quarter by 10%, assuming constant currency, your forecasting accuracy should be calculated as (95%+100%+100%+90%)/4 = 96.25%. Forecast accuracy for an individual forecast is calculated as actual at forecast currency versus base forecast for the same period.

C40

1. Average Time To Create A New Report For Which There Is No Previously Defined Report Template: Number of days required to create a new report for which there is no previously defined report template. This should include both reports created by business users in Finance and Line of Business as well as reports created by IT. This should reflect the elapsed time (from request date of report to the date the report is operational), not man days (effort).

5 Please provide the following G/L and Financial Closing related metrics.Metric

(Help)

6 Please provide the following Cost Accounting and Analysis related metrics. Metric Total Number of Customers Profitable Customers (in %) (Help)

7 Please provide the total Finance Cost and its break down into main cost categories. Metric

(Help)

8 Please provide the Number of Finance FTEs in the organization.

9 Please provide the average fully loaded cost per Finance FTE.

10 Please provide staffing and cost information for the following Finance sub-processes.Sub-process Finance FTEs

(Help)

Financial Performance and Risk Management: Information Technology Deployed

Avg. Days to Close Monthly Books Avg. Days to Close Quarterly Books Avg. Days to Close Annual Books

Total Finance Costs Headcount Costs External Expenditures Technology Costs Other Costs

Finance Strategy and Leadership Compliance and Risk Management Budgeting and Forecasting Business and Operations Analysis And Reporting G/L and Financial Closing Cost Accounting and Analysis

C48

1. Average Time To Close Monthly Books (in days): Number of business days required to complete the hard monthly close. A 'hard' close is generally associated with the traditional 'close the books' process for the production of financial reports for outside regulators. It typically involves performing reconciliations; examination of next period transactions for undetected accruals or transactions processed into the wrong period (cut-off); verification of physical balances through stock counts; and analysis of current period transactions and balances to detect errors arising from mis-classification or mis-posting. The hard close focuses on accuracy and results in regulatory financial statements (e.g., GAAP, SEC). It locks down the general ledger from posting in the current period. The metric should reflect the elapsed time (= number of business days between start of process to finish), not man days (effort). 2. Average Time To Close Quarterly Books (in days): Number of business days required to complete the hard quarterly close. This should reflect the elapsed time (= number of business days between start of process to finish), not man days (effort). 3. Average Time To Close Annual Books (in days): Number of business days required to complete the hard annual close. This should reflect the elapsed time (= number of business days between start of process to finish), not man days (effort).

C54

1. Total Number Of Customers: Estimate the total number of customers you supported during the past 12 months. Use your company's definition of customer. 2. % Of Profitable Customers: Provide the percentage of customers with a positive profit margin. If you do not know the answer, please leave blank.

C63

1. Finance Costs: Includes all Finance function related costs such as cost of Finance staff (headcount costs), external spend, technology spend and all other Finance function related spend. a) Headcount Costs: Total headcount costs for the Finance function, that is, salaries, bonus, and benefits for all Finance employees. If you do not know the exact benefits, please use an estimate. Most companies have benefits in the range of 20% and 30% of the base salary. b) External Expenditure: Includes cost of all external providers for services which could be provided in-house, for example, if customer billing is outsourced, external spend should include cost of printing bills and answering customer inquiries about the bills. For more detailed listing on what should be included in External Spend please refer to section External Spend by function. c) Technology Costs: Should reflect any technology cost associated with the Finance budget, for example charge backs from the IT department, if available. Do not include costs for dedicated IT headcount if this has already been captured in the Finance Staffing section, but include Finance technology cost even if it is not part of the Finance budget (for example, if it is part of the IT budget). d) Other Costs: Includes any other costs associated with the Finance function, such as travel, facilities, utilities, communication, charge backs to other departments.

C78

1. FTE (Full Time Equivalent): A measurement equal to one staff person working a full-time work schedule for one year For example, if a Finance function is delivered by Finance employees who spend 20% of their time (or one day per week) working on this function, the headcount for this function would be 0.2 FTEs Another example would be a Finance function performed by four employees - two of them full time, and two of them working 50% on this function. In that case, the headcount for this function would be 3.0 FTEs a. Finance Strategy And Leadership: * Overall Finance Strategy * Management activities * Negotiate service level agreements * Establish accounting policies * Publish accounting policies * Set up and enforce approval limits * Establish common financial systems b. Compliance And Risk Management: * Regulatory And Compliance: - Operate compliance function - Manage activities of compliance function - Manage organizational model and reporting relationships for compliance function - Manage key capabilities of compliance function, implement and maintain controls-related enabling technologies and tools - Report compliance related issues to external auditors, regulators, share/ debt-holders, securities exchanges and internal management etc. * Internal Auditing: - Prepare internal audits of business units and corporate as well as operations * Risk Management - Chief Risk Officer (CRO) - Consolidation of reported risks from operations and business units - Analysis of risks and definition of measures against risks c. Budgeting And Forecasting: * Develop and maintain budget policies and procedures * Prepare periodic budgets and plans * Prepare periodic forecasts d. Business And Operations Analysis And Reporting: * Assess customer and product profitability * Evaluate new products * Perform life cycle costing * Optimize customer and product mix * Track performance of new customer and product strategies * Prepare activity-based performance measures * Manage continuous cost improvement e. G/L And Financial Closing: * Maintain chart of accounts * Process journal entries * Process allocations * Process period end adjustments (tax, currencies, and accruals) * Post and reconcile intercompany transactions * Reconcile general ledger accounts * Perform consolidations (process eliminations) * Prepare trial balance * Prepare and post management adjustments * Prepare business unit financial statements * Prepare consolidated financial statements * Perform business unit reporting/ review management reports * Perform consolidated reporting/ review of cost management reports * Prepare statements for board * Produce quarterly/ annual shareholder financial report f. Cost Accounting and Analysis: * Cost Ascertainment: Ascertain cost of production of each job, process, or work * Cost Analysis: Find the cause and effect of variance from the budgeted cost to the actual cost * Cost Comparison: Measure the efficiency of each process or department * Cost Control: Controls cost by setting standards, identify deviation in performance and recommend necessary controlling measures * Cost Reporting: Report to the management periodically * Fix selling prices of the product or process job or operation * Preparing necessary tenders or quotations 2. External Spend per Function: The following provides a set of examples on what should and should not be included in external spend on the functional level. These are examples only, not a complete list of cost items. Cost for temporary Finance labor, if applicable, should be included as well. a. Finance Strategy And Leadership: Consulting expenses related to Finance Strategy b. Compliance And Risk Management: External accountants or consultants supporting Sarbanes-Oxley requirements or Risk Management, not included external audit fees c. Budgeting And Forecasting: Consulting expenses related to Budgeting and Forecasting d. Business And Operations Analysis And Reporting: Consulting expenses related to Business and Operations Analysis e. G/L And Financial Closing: Cost for external accountants f. Cost Accounting and Analysis: Consulting expenses related to Cost Accounting and Analysis

11 Please provide information on the software products used for supporting Finance processes.

Processes SAP Products Used Other Products Used

Other SAP - please indicate:

12 Please provide the importance of following technology enablers to your organization. Please provide the current state of adoption on these technology enablers.

Technology Enablers

Mobility Cloud Business Intelligence & Analytics In-memory Computing

13 Please provide the % of Finance reports for which MS Office (Excel, Access) is used.

14 Please provide any additional comments/ clarifications for the FPRM KPI information provided above.

Financial Performance Management Treasury and Financial Risk Management Payables Management Receivables Management Accounting and Financial Close Financial Shared Services Corporate Strategy Manage Enterprise Risk and Compliance

Importance (Current/Future Focus)

Please provide the following basic financial and operating information.

Answer

Please provide the following Compliance and Risk Management related metrics. Answer

Please provide the following Budgeting and Forecasting related metrics. Answer

Please provide the following Business and Operations Analysis and Reporting related metrics. Answer

Please provide the following G/L and Financial Closing related metrics. Answer

Please provide the following Cost Accounting and Analysis related metrics. Answer

Please provide the total Finance Cost and its break down into main cost categories. Answer

Please provide the average fully loaded cost per Finance FTE.

External Expenses

Please provide information on the software products used for supporting Finance processes.

Please provide the importance of following technology enablers to your organization. Please provide the current state of adoption on these technology enablers.

Adoption

Name SAP Products/ Other Products/ Vendors

Financial Performance and Risk Management: Best Practices

15 Finance Strategy and Leadership Importance Coverage

An office of strategic planning exists and has executive support to enable the creation of scorecards, objectives and KPIs

16 Compliance and Risk Management Importance Coverage

Risks are linked to the internal controls for on-going monitoring and remediationThe organization has the capability to assess alternative risk responses and scenarios to determine the optimal action

On a scale of 1-5, please rank each best practice in terms of importance and degree of coverage: Importance: 1 = Not important; 5 = Extremely importantCoverage: 1 = No coverage today - Organization does not employ this best practice; 5 = Best practice is fully adopted Please indicate NA for both importance and coverage if best practice is not applicable to your organization:

There is a closed-loop process to link strategic goals to key organization objectives with assigned targets that are communicated downwards and results reported back to the managementFinance leadership has access to a cockpit/dashboard that provides a timely and integrated view into pre-defined set of key financial and operational metricsStrategic planning is not limited to the office of the CFO; IT and HR plans are also aligned to ensure systems and budgets are in place to support the overall strategyStrategic plans are linked to lower level operational and financial plans to ensure correct alignment of KPI and budget information across all unitsFinance system has automated reporting and analysis capabilities to identify which financial processes can potentially drive operational efficiencies and lower costsOwnership and accountability has been assigned for all key metrics to ensure that mitigating actions are executed promptly once a metric falls out of the acceptable range

The organization has established an enterprise wide risk management culture, with clearly defined risk management framework, and responsibilities assigned to the LOBsThe development process for organizational strategies, goals, and objectives take risk into account, and provides for impact assessmentThe organizational establishes risk tolerances and automated reports and alerts are generated for risks exceeds this tolerance thresholds

The finance organization is automatically able to monitor and analyze strategic, operational, compliance, and reporting risks across enterprise systems (e.g. CRM, HCM, etc.)

The organization maximizes the use of automated controls, rather than manual controls to improve assurance

17 Budgeting and Forecasting Importance CoverageThe organization uses rolling forecasts as the basis for their budget planning

The planning system supports establishing top-down strategic objectives and planning from the bottom-up

18 Business and Operations Analysis and Reporting Importance Coverage

All processes are well-documented and meet financial compliance requirements (SOX Section 404, BilMoG, 8th EU Directive, JSOX, Clause 49 for India, etc.)

The organization establishes careful role definition, limits and monitors super-user and emergency access so that only business-required access has been grantedAutomated processes are in place to ensure compliance with global trade laws and regulations (e.g., compliance with Foreign Corrupt Practices Act)The internal audit plan is driven by the enterprise risk management program, ensuring that internal audit is focused on current risks to the organizationInternal audit uses enterprise automation tools (including business intelligence and automated controls testing solutions) for fraud and error detection and investigationIssues identified by internal audit (and other assurance providers) are updated into the enterprise risk management system and their impact on risks assessed

Budgeting and forecasting is a continuous loop process of planning, measuring and simulation that relies on up-to-date insight from multiple functions and regionsStandardized planning models are used throughout the organization ensuring consistency and comparability of submitted resultsThe planning and forecasting process is collaborative allowing supervisors to review the status anytime while individuals work on the plans/forecasts in a virtual teamThe forecasting system allows users to directly access standardized input forms and templates at the beginning of the planning cycleThe organization enables automated budget and forecast simulations by leveraging several key drivers (e.g., revenue growth estimates)

Financial systems are used in the business analysis process by providing historical and forward looking views into financial and operational performanceScorecards are implemented and used to connect strategic to operational goals. Scorecards exist at staff level, as well as management and executive levelsThe organization has capabilities for ad hoc analysis and reporting along key dimensions (customers, regions, divisions etc.) with detailed drill-down visualizationOperational reviews and board package content can be automatically generated directly from financial systems in user preferred formats like PDF, Excel, PPT, Word, etc.The reporting systems automatically surface or send alerts when abnormal or large variances occur based on predefined rules and thresholds

19 G/L and Financial Closing Importance Coverage

The current General Ledger (G/L) Accounting system can handle multiple accounting standards (e.g. US GAAP, IFRS, etc.)The current consolidation system can handle multiple accounting standards (e.g. US GAAP, IFRS)

Intercompany reconciliations are conducted in a decentralized, peer-to-peer manner

The G/L and downstream financial systems are supported for up-to-date accounting data and master data synchronization

A global chart of accounts is used across the entire organization with appropriate mapping of the local accounts to it

20 Cost Accounting and Analysis Importance Coverage

All operational entities within the organization follows standardized costing methods and proceduresCost and profitability reports are generated to the level of product, channel and customer

Real time 'What-if?' analysis is possible, to model and test the impact of changes to profitability before committing to plans

Cost accounting accesses information from all of the integrated components such as G/L, A/P, Billing, Purchasing etc.

The organization is able to allocate internal shared services costs in a manner that reflects actual usage

21

Business and operational analysis is based on a single source (integrated data model) of financial and non-financial information

The financial system can support internal as well as external accounting requirements (e.g. statutory, segment, regulatory and management views)

The system allows prior year comparisons between local GAAP and IFRS during a transition and allows for easy reconciliation

The system allows publishing of financial statements in an interactive format (like XBRL) per SEC requirements, in-house as opposed to out-sourcingChanges in group structure (e.g., changes in equity interests, consolidation frequency and methods) can be processed easily

Cost and profitability reporting uses true cause and effect business rules to assign costs, rather than high-level apportionments

The cost accounting dashboard supports analysis along multiple dimensions including product, location and pre-defined activitiesThe organization regularly reviews the profitability of the product, channel and customer to develop strategies for improvement

Please describe other best practices your company has adopted to drive leading Financial Performance and Risk Management performance.

22


Please provide the name, email address, phone number and organization name of any person(s) other than yourself you wish to give permission to actively participate in the benchmarking process. This person(s) will be included in any and all interactions between you and the SAP team related to the validation and comparative results of this survey. By entering this person's contact information, you indicate that you are giving permission for this person(s) to view your organization’s survey data, benchmark results, and related communications; to participate in meetings; and to submit/correct benchmark related data to SAP on your behalf. You also agree that, regarding all aspects of the SAP Benchmarking program, this person(s) is subject to the same level of confidentiality to you as you are to SAP.

Financial Performance and Risk Management Survey: Best Practices Maturity ModelAll stages 1 – 5 can be chosen for any best practice, even if a description is not in place

OrignalShared Services Scope And Adoption

Level 1 Level 2 Level 3 Level 4 Level 5

1

2


Office of strategic planning does not exist

An office of strategic planning exists but does not have executive support to enable the creation of scorecards, objectives and KPIs


There is a closed-loop process to link strategic goals to key objectives with assigned targets. Goals are communicated downwards and results are reported back to management

Key objectives are not linked to strategic goals

Key objectives are informally linked to strategic goals, but there is no feedback process on the results back to management

Key objectives are formally linked to strategic goals, with measures and targets assigned to objectives, and there is an informal feedback process in place to report the results back to management

Key objectives are formally linked to strategic goals, with measures and targets assigned to objectives. There is a process to communicate those goals downwards through the organization and measure the results on the high level

There is an effective close-loop management process that ties key objectives to strategic goals and assigns measures and targets to those objectives. At the same time there is a process to communicate those goals downwards through the organization and measure the results which are reported back to management

3

4

5

Finance leadership has access to a financial cockpit and/ or dashboard that provides a timely view into pre-defined set of key metrics (such as sales information on a daily basis)

Dashboard is manually created on an adhoc/ needs basis

Finance leadership has access to a manually created financial dashboard that provides a view into pre-defined set of key metrics on a quarterly basis

Finance leadership has access to a semi automatically created dashboard that provides a view into pre-defined set of key metrics on a monthly basis

Finance leadership has access to a largely automated dashboard that provides a timely view into pre-defined set of key metrics on a weekly basis

Finance leadership has access to a financial cockpit and/ or dashboard that provides a timely view into pre-defined set of key metrics (such a sales information, etc) on a daily basis

Strategic planning is not limited to the office of the CFO. In particular IT plans and HR plans are closely aligned to ensure systems and budgets are in place to support the overall strategy

Strategic planning is limited to the office of the CFO and does not include input from other departments.

Strategic planning rarely includes input from other departments

Strategic planning occasionally includes input from other departments

Strategic planning includes input from other departments most of the time

Strategic planning is not limited to the office of the CFO but includes input from other departments. In particular IT plans and HR plans are closely aligned to ensure systems and budgets are in place to support the overall strategy.

Strategic plans are linked to lower level operational and financial plans to ensure alignment of KPI and budget information, from more detailed plans, to higher level plans

Strategic plans do not exist or are not linked to lower level operational and financial plans

Strategic plans are linked to lower level financial plans to ensure alignment of KPI and budget information, from more detailed plans, to higher level plans

Strategic plans are linked to lower level operational and financial plans to ensure alignment of KPI and budget information, from more detailed plans, to higher level plans

6

7

8

9

Finance system has automated reporting and analysis capabilities to identify which financial processes can potentially be improved to drive operational efficiencies and lower costs

Finance system does not have appropriate reporting and analysis capabilities to identify which financial processes can potentially be improved to drive operational efficiencies and lower costs

Finance system has limited high level analysis capabilities (which needs to be supplemented with additional manual analysis) to identify which financial processes can potentially be improved to drive operational efficiencies and lower costs

Finance system has automated reporting and analysis capabilities to identify which financial processes can potentially be improved to drive operational efficiencies and lower costs

Ownership and accountability has been assigned for all key metrics on the operational level, to ensure that mitigating actions are executed promptly once a metric falls out of the acceptable range

Ownership and accountability has not been assigned

Ownership and accountability has been assigned for some key metrics on the operational level, however mitigation actions to be executed once a metric falls out of the acceptable range, are not defined

Ownership and accountability has been assigned for some key metrics on the operational level, and mitigating actions are clearly defined

Ownership and accountability has been assigned for most key metrics on the operational level, and mitigating actions are clearly defined

Ownership and accountability has been assigned for all key metrics on the operational level, to ensure that mitigating actions are executed promptly once a metric falls out of the acceptable range

The company has established an enterprise wide risk management culture, with clearly defined risk management framework, and responsibilities assigned to the LOB's

The company does not have an entreprise wide risk management culture

A risk management culture is emerging in some departments/units

The company has established an enterprise wide risk management culture and risk management steps are defined on a need basis

The company has established an enterprise wide risk management culture, with clearly defined risk management framework, and responsibilities are assigned on a need basis

The company has established an enterprise wide risk management culture, with clearly defined risk management framework, and responsibilities assigned to the LOB's

The development process for organizational strategies, goals, and objectives take risk into account, and provides for impact assessment

The development process for organizational strategies, goals, and objectives does not take risk into account, or provide for impact assessment

The development process for organizational strategies, goals, and objectives sometimes take risk into account, in an informal way

The development process for organizational strategies, goals, and objectives consistently takes risk into account, but in an informal way

The development process for organizational strategies, goals, and objectives consistently and formally takes risk into account

The development process for organizational strategies, goals, and objectives take risk into account, and provides for impact assessment

10

11

12

13

Organizational risk tolerances are established and risks exceeding the tolerances identified for appropriate risk response. Automated alerts are generated

Organization risks are tackled as independent events

Organizational risk tolerances are in the process of being established

Organizational risk tolerances are established and appropriate risk response for risks exceeding the tolerances is identified on a need basis

Organizational risk tolerances are established and risks exceeding the tolerances identified for appropriate risk response. However constant manual monitoring of these KRI is required to identify tolerance breach.

Organizational risk tolerances are established and risks exceeding the tolerances identified for appropriate risk response. Automated alerts are generated.

Risks are linked to the internal controls for on-going monitoring and remediation

Risks are not linked to the internal controls for on-going monitoring and remediation

Few risks are linked to the internal controls for on-going monitoring and remediation

Some risks are linked to the internal controls for on-going monitoring and remediation

Most risks are linked to the internal controls for on-going monitoring and remediation

All risks are linked to the internal controls for on-going monitoring and remediation

Alternative risk responses and scenarios are assessed to determine the optimal action

There is no ability to automatically assess alternative risk responses and scenarios to determine the optimal action

There is limited, high level ability to automatically assess alternative risk responses and scenarios to determine the optimal action for select business processes

There is limited, high level ability to automatically assess alternative risk responses and scenarios to determine the optimal action across most business processes

Alternative risk responses and scenarios are automatically assessed to determine the optimal action for select business processes

Alternative risk responses and scenarios are automatically assessed to determine the optimal action for most business processes

The CFO has the automated ability to monitor and analyze strategic, operational, compliance, and reporting risks across enterprise systems (e.g. customer relationship management, human resource management, purchasing)

Finance systems analyze performance of different functions but do not analyze risk

Finance systems analyze risks only across finance systems

Finance systems analyze risks across systems such as customer relationship management, human resource management, purchasing and so forth

14

15

16

All processes are well-documented and meet financial compliance requirements - example, Sarbanes Oxley (SOX) Section 404 requirements, BilMoG, 8th EU Directive, JSOX, Clause 49 for India

The processes to comply with the local and international reporting standards (such as Sarbanes Oxley, Basel II etc) are still evolving and in process of being documented

All processes are well-documented and capable to comply with local reporting standards such as Sarbanes Oxley, Basel II etc

All processes are well-documented and capable to comply with the local and international reporting standards such as Sarbanes Oxley, Basel II etc

The use of automated controls, rather than manual controls, is maximized to improve assurance and minimize cost

Majority of the controls (> 90%) are manual as opposed to being automated

Majority of the controls (> 70%) are manual as opposed to being automated

Automated controls are partially implemented (~50%)

Largely automated controls are in place (>70%)

The use of automated controls, rather than manual controls, is maximized to improve assurance and minimize cost

Access control risks are minimized through: careful role definition, limits to and monitoring of superuser and emergency access, regular monitoring to ensure only business-required access has been granted

Access control risks are not managed, because none of the following are in place: 1) careful role definition (processes in place to prevent segregation of duties issues while granting access rights); 2) limits to and monitoring of super-user access; 3) limits to and monitoring of emergency access to correct data or program errors; 4) regular monitoring to ensure only business-required access has been granted

Access control risks are partially managed, because at least one of the following is in place: 1) careful role definition (processes in place to prevent segregation of duties issues while granting access rights); 2) limits to and monitoring of super-user access; 3) limits to and monitoring of emergency access to correct data or program errors; 4) regular monitoring to ensure only business-required access has been granted

Access control risks are partially managed, because some of the following are in place: 1) careful role definition (processes in place to prevent segregation of duties issues while granting access rights); 2) limits to and monitoring of super-user access; 3) limits to and monitoring of emergency access to correct data or program errors; 4) regular monitoring to ensure only business-required access has been granted

Access control risks are partially managed, because most of the following are in place: 1) careful role definition (processes in place to prevent segregation of duties issues while granting access rights); 2) limits to and monitoring of super-user access; 3) limits to and monitoring of emergency access to correct data or program errors; 4) regular monitoring to ensure only business-required access has been granted

Access control risks are minimized through: careful role definition (processes in place to prevent segregation of duties issues while granting access rights); limits to and monitoring of super-user access; limits to and monitoring of emergency access to correct data or program errors; regular monitoring to ensure only business-required access has been granted

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Effective automated processes are in place to ensure compliance with global trade laws and regulations (e.g., compliance with Foreign Corrupt Practices Act)

Compliance with global trade laws and regulations is ensured manually

Compliance with global trade laws and regulations has been automated for some regulations/countries

Effective automated processes are in place to ensure compliance with global trade laws and regulations (e.g., compliance with Foreign Corrupt Practices Act)

The internal audit plan is driven by the enterprise risk management program, ensuring that internal audit is focused on current risks to the organization

The internal audit does not take risk into account

The internal audit takes risk into account in an informal manner

The internal audit plan is driven by the enterprise risk management program, ensuring that internal audit is focused on current risks to the organization

Internal audit uses enterprise automation tools (including business intelligence and automated controls testing solutions) for fraud and error detection and investigations

Internal audit uses manual methods for fraud and error detection and investigations

Internal audit uses enterprise automation tools for fraud and error detection and investigations in some areas

Internal audit uses enterprise automation tools (including business intelligence and automated controls testing solutions) for fraud and error detection and investigations

Issues identified by internal audit (and other assurance providers) are updated into the enterprise risk management system and their impact on risks assessed

Issues identified by internal audit (and other assurance providers) are not tracked in an enterprise risk management system

Issues identified by internal audit (and other assurance providers) are updated into the enterprise risk management system

Issues identified by internal audit (and other assurance providers) are updated into the enterprise risk management system and their impact on risks assessed

The company is using rolling forecasts as the basis for their budget

The company is not using rolling forecasts as the basis for their budget

The company is using rolling forecasts as the basis for their budget for some functions and some regions

The company is using rolling forecasts as the basis for their budget for all functions and regions

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Budgeting and forecasting is a continuous loop process of planning, measuring and modeling that relies on up-to-date "actual" results and scenario-based collaboration across business functions and regions

No continuous loop process, no up to date insight from multiple functions and regions

Budgeting and forecasting process takes into account feedback from few functions within one region

Budgeting and forecasting process takes into account feedback from most functions within one region

Budgeting and forecasting process takes into account feedback from most functions and most regions

Budgeting and forecasting is a continuous loop process of planning, measuring and simulation that relies on up-to-date insight from multiple functions and multiple regions

Standardized planning models are used throughout the organization ensuring consistency and comparability of submitted results

No standardized planning models are used

Initial efforts in place to standardize planning models in some regions/business units

Standardized planning models are used across some regions/business units

Standardized planning models are used across most regions/business units

Standardized planning models are used throughout the organization ensuring consistency and comparability of submitted results

The planning and forecasting process is collaborative in that it allows supervisors to review and approve the status at any point in time while individuals work together on the creation of the plans/ forecasts in a virtual team environment

The planning and forecasting process is not collaborative

The planning and forecasting process is collaborative in some areas, and exchange or approval of documents happens in a manual fashion

Supervisors and teams collaborate fully on plan/forecasts, and exchange or approval of documents happens in a manual fashion

Supervisors and teams collaborate fully on plan/forecasts, and exchange or approval of documents happens sometimes in a manual fashion, sometimes in a virtual team environment

The planning and forecasting process is collaborative in that it allows supervisors to review and approve the status at any point in time while individuals work together on the creation of the plans/forecasts in a virtual team environment

The forecasting system allows users to directly access standardized input forms or electronically distributes standardized templates at the beginning of the planning cycle

The forecasting system does not allow users to directly access standardized input forms

The forecasting system allows users to directly access standardized input forms but does not electronically distribute standardized templates at the beginning of the planning cycle

The forecasting system allows users to directly access standardized input forms or electronically distributes standardized templates at the beginning of the planning cycle

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Budget and forecast simulations can be automatically produced or results simulated using several key drivers (e.g. revenue growth estimates)

Budget and forecast simulations are done manually

Budget and forecast simulations can be automatically produced or results simulated using only a limited number of key drivers

Budget and forecast simulations can be automatically produced or results simulated using only several key drivers (e.g. revenue growth estimates)

The planning system supports top down strategic objectives and planning from the bottom up

There is no capability to systematically combine top down strategic objectives with allocations and planning from the bottom up

The planning system supports top down strategic objectives, but allocations and planning from the bottom up are not systematically integrated

The planning system supports top down strategic objectives, allocations and planning from the bottom up, enabling consensus process

Financial systems are used in the business analysis process by providing historical and forward looking views into financial and operational performance

Business analysis (on both financial and operational performance) is mainly manually conducted

Business analysis leverages financial systems for historical information on financial performance

Business analysis leverages financial systems for historical information on financial and operational performance

Business analysis leverages financial systems for historical information on financial and operational performance, and has forward looking capabilities to analyze financial performance

Financial systems are used in the business analysis process by providing historical and forward looking views into financial and operational performance

Scorecards are implemented and used to connect strategic to operational goals. Scorecards exist at staff level, as well as management and executive levels

Balanced scorecards are not used

Balanced scorecards are in place to connect strategic to operational goals, but they are updated infrequently

Balanced scorecards are in place to connect strategic to operational goals, and they are updated on a monthly basis

Balanced scorecards are implemented to connect strategic to operational goals, and they are updated on a daily basis

Real time Balanced Scorecards are implemented and used to connect strategic to operational goals. Finance is actively involved in the design and execution of the Balanced Scorecard

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Analytical systems allow for online ad-hoc analysis and reporting along key dimensions (customers, regions, divisions etc.) as well as drill-down to the desired level of detail

Analysis is mainly manually conducted

Analytical systems allow for online analysis and reporting based on standardized reports along key dimensions (customers, regions, divisions etc.)

Analytical systems allow for online ad-hoc analysis and reporting along key dimensions (customers, regions, divisions etc.)

Analytical systems allow for online ad-hoc analysis and reporting along key dimensions (customers, regions, divisions etc.) with limited drill-down capabilities

Analytical systems allow for online ad-hoc analysis and reporting along key dimensions (customers, regions, divisions etc.) as well as drill-down to the desired level of detail

Operational reviews and board package content can be automatically generated directly from financial systems in the formats users prefer. (PDF, Excel, PowerPoint, Word, etc.)

Operational reviews and board package content has to be manually generated from financial systems

Operational reviews and board package content can be automatically generated directly from financial systems for some formats

Operational reviews and board package content can be automatically generated directly from financial systems in the formats users prefer. (PDF, Excel, PowerPoint, Word, etc.)

Reporting systems automatically surface or send alerts when abnormal or large variances occur based on predefined rules and thresholds

Reporting systems do not detect abnormal or large variances occur based on predefined rules and thresholds

Reporting systems automatically identifies abnormal or large variances based on predefined rules and thresholds, but does not have automated alerting capabilities

Reporting systems automatically surface or sends alerts when abnormal or large variances occur based on predefined rules and thresholds

Business and operational analysis is based on a single source (integrated data model) of financial and non-financial information providing consistent data across all views of information

Many separate and non integrated sources in place

Most financial information resides in few separate and non integrated data sources, and they are not integrated with non financial information

There is a single data source for most financial information but it is not integrated with non financial information

There is a single data source for most financial information, with integration to some non financial data sources

Business and operational analysis is based on a single source (integrated data model) of financial and non-financial information providing consistent data across all views of information

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The financial system can support internal as well as external accounting requirements (e.g. statutory, segment, regulatory and management views)

The financial system does not support all required internal and external accounting requirements

Separate financial systems support internal and external accounting requirements (e.g. statutory, segment, regulatory and management views)

The financial system can support both internal as well as external accounting requirements (e.g. statutory, segment, regulatory and management views)

The current general ledger (G/L) accounting system can handle multiple accounting standards (e.g. US GAAP, IFRS)

The current general ledger (G/L) accounting system is designed for a single accounting standard (e.g. US GAAP, IFRS)

The current general ledger (G/L) accounting system can handle a few but not all required accounting standards

The current general ledger (G/L) accounting system can handle all required accounting standards (e.g. US GAAP, IFRS)

The current consolidation system can handle multiple accounting standards (e.g. US GAAP, IFRS)

The current consolidation system system is designed for a single accounting standard (e.g. US GAAP, IFRS)

The current consolidation system system can handle a few but not all required accounting standards

The current consolidation system can handle all required accounting standards (e.g. US GAAP, IFRS)

System allows prior year comparisons between local GAAP and IFRS during a transition and allows for easy reconciliation

System allows des not allow prior year comparisons between local GAAP and IFRS during a transition

System allows prior year comparisons between local GAAP and IFRS during a transition

System allows prior year comparisons between local GAAP and IFRS during a transition and allows for easy reconciliation

Intercompany reconciliations are conducted in a decentralized, "peer-to-peer" manner

Intercompany reconciliations are conducted centrally by corporate finance

Intercompany reconciliations are centralized on the regional level

Intercompany reconciliations are conducted in a decentralized, "peer-to-peer" manner

System allows publishing of financial statements in "interactive format" (XBRL) per SEC requirements, in-house (as opposed to out-sourcing)

System does not allow for publishing of financial statements in "interactive format" (XBRL) per SEC requirements, and it is therefore outsourced

System allows publishing of financial statements in "interactive format" (XBRL) per SEC requirements, in-house (as opposed to out-sourcing)

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Changes in group structure (e.g. changes in equity interests, consolidation frequency and methods) can be processed easily

Changes in group structure (e.g. changes in equity interests, consolidation frequency and methods) take a lot of effort to process

Changes in group structure (e.g. changes in equity interests, consolidation frequency and methods) take some degree of effort to process

Changes in group structure (e.g. changes in equity interests, consolidation frequency and methods) can be processed easily

The G/L and downstream financial systems are integrated in such a way that account data is up-to-date and synchronized at all times

The G/L and downstream financial systems are not integrated

G/L and downstream financial systems are synchronized via batch updates

The G/L and downstream financial systems are integrated in such a way that account data is up-to-date and synchronized at all times

A global chart of accounts is used across the entire company and local accounts are required to be mapped to the global charts of accounts

A separate local chart of accounts is used by divisions/ regions and these are not mapped to the global chart of accounts

Few regions have standardized on a common chart of accounts

Several regions have standardized on a common chart of accounts

Most regions have standardized on a common chart of accounts

A global chart of accounts is used across the entire company and local accounts are required to be mapped to the global charts of accounts


Cost and profitability reporting uses high-level apportionments to assign costs (no cause and effect)

Cost and profitability reporting uses detailed apportionments to assign costs (no cause and effect)

Cost and profitability reporting uses high-level cause and effect business rules to assign costs

Cost and profitability reporting uses more detailed cause and effect business rules to assign costs


All operational entities within the company follow standardized costing methods and procedures

Each operational entity within the company follows independent costing methods and procedures, which are then collated at the company level

All operational entities within a region/ division follows standardized costing methods and procedures

All operational entities within the company follows standardized costing methods and procedures

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Cost and profitability reports are generated to the level of product, channel and customer

Cost and profitability reports cannot be prepared to the level of product, channel and customer

Cost and profitability reports can be prepared to some degree of detail

Cost and profitability reports are generated to the level of product, channel and customer


Only adhoc data is available to model and test the impact of changes to profitability before committing to plans

Monthly data is available to model and test the impact of changes to profitability before committing to plans

Weekly data is available to model and test the impact of changes to profitability before committing to plans

Daily data is available to model and test the impact of changes to profitability before committing to plans


Cost accounting accesses information from all of the integrated components such as G/L, A/P, billing, purchasing etc.

Cost accounting cannot automatically access information from G/L, A/P, billing, purchasing etc.

Cost accounting can access select information from select relevant processes (G/L, A/P, billing, purchasing etc.)

Cost accounting accesses information from all of the integrated components such as G/L, A/P, billing, purchasing etc.

The cost accounting system supports cost analysis along multiple dimensions including product, location and pre-defined activities

The cost accounting system does not support cost analysis along multiple dimensions including product, location and pre-defined activities

The cost accounting system supports cost analysis along few, but not all required dimensions (product, location and pre-defined activities)

The cost accounting system supports cost analysis along multiple dimensions including product, location and pre-defined activities

Product, channel and customer profitability is reviewed on a regular basis to develop strategies for improvement

Product, channel or customer profitability are unknown

Profitability is reviewed, but not on a regularly scheduled basis

Some profitablility dimensions (product, customer, channel) are reviewed on a regular, but not necessarily frequent basis

Some profitablility dimensions (product, customer, channel) are reviewed on a regular and frequent basis

Product, channel and customer profitability is reviewed on a regular and frequent basis to develop strategies for improvement

Internal shared services costs are allocated in a manner that reflects actual usage

Internal shared services costs are not charged back

Portions of internal shared services costs are charged back based on blanket allocation

Portions of internal shared services costs are charged back to BU’s, based on transaction volume

Most internal shared services costs are charged back to BU’s, based on transaction volume

Internal shared services costs are allocated in a manner that reflects actual usage

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