Pidilite deploys MAIA 1KEY FCM to streamline financials
Pidilite eliminated spreadsheet-based manual closing of books and financial consolidation with MAIA’s 1KEY FCM By Rajendra Chaudhary
A layman may not know much about Pidilite but ask him about adhesives and the first name that you would be likely to hear would be that of Fevicol—which has become a household name in adhesives. Such is the company’s lead in its space. For over half a decade, Pidilite Industries has been a pioneer in the consumer and specialties chemicals business in India. Additionally, it also manufactures a range of paint chemicals, art materials, textile, industrial resins and organic pigments.
Pidilite has operations with multiple business units within and outside India. In recent years, with its expanding business and continued growth, the company has found it increasingly difficult to manage its financial consolidation and reporting activities. As it deals with multiple currencies, various accounting standards and a host of reporting and compliance regulations, the company struggled with the challenges brought on by the integration of new business units into the reporting chain. Additionally, Pidilite was required to balance the need for precise financial reporting and corporate governance with the need for timeliness in meeting reporting deadlines.
Consolidating spreadsheets became a challenge
The group companies of Pidilite Industries were using different financial accounting applications and, up until recently, regulatory financial consolidation reporting used to take nearly a month to put together.
Additionally, the accounts officers at the company’s head office would manually consolidate the data coming from 19 companies using Microsoft Excel sheets.
As per Prasad Parab, CIO, Pidilite Industries, the company’s accountants and financial officers were facing increasing pressure when it came to the consolidation of financial accounts based on group companies, business areas, profit centers, divisions/branches, and SBUs. “The statutory consolidation reporting, which required the reported data to be aggregated into consolidated financial statements on a quarterly basis, had become a major business issue,” said Parab.
The company not only struggled with the consolidation of financial data and efforts that it took for coordinating with financial users spread across three continents viz. Asia, Europe and North America, but it also faced issues around getting large volumes of data validated and certified by users (24 months of historical data for each of the regions) and this was becoming a lingering issue. The task was further compounded by the challenges faced in consolidating Excel sheets on account of the software’s shortcomings with regard to data integration, visibility of subsidiary and international data, inter-company eliminations and dimensionality.
Finance executives at Pidilite were facing the daunting task of consolidating a company’s financial and operating results using spreadsheets that were difficult to maintain and audit. They couldn’t pull the data from numerous transactional systems without significant IT support. Too often, the company got tripped up by the inter-company reconciliation process, data quality, collection errors, weak audit trails, poor performance of the applications being used for consolidation and lack of automation for key processes.
Sandeep Batra, Director-Finance, Pidilite Industries said that on many occasions, the finance team had to sit with the IT team and spend hours in fixing errors, which not only meant longer financial close cycles but also considerable financial overheads. This also meant that critical financial information wouldn’t be available for the decision makers and the investors when they needed it the most.
Data coming from different companies located in countries such as India USA, Egypt, Bangladesh, UAE, Indonesia, Brazil, Singapore, Thailand, etc. is in different currencies. For consolidation, converting them to Indian rupees was necessary which was challenging in the previous system.
The management team decided that it needed standard robust automated systems to improve and speed up its business processes.
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Posted on June 7th, 2010 by Guest
Filed under: Business Intelligence
Great Leap!!!!