One interesting phenomenon of cloud-ERP system-adoption is that customers often elect to extend use to geographies where the product is not formally marketed and supported, and where the ERP vendor has no physical presence.
Superficially, this type of almost-accidental global adoption appears to suit everyone. Customers enforce corporate uniformity simply by setting up a new system company and granting access to remote-location users. Vendors generate additional revenues and gain traction in hitherto unreachable markets. And remote employees gain immediate access to corporate standard solutions with no installation and setup hassles.
In high-volume, low-margin manufacturing and distribution industries, where even tiny incremental improvements can materially enhance the bottom line, the value of global system adoption is too tempting to ignore.
However, implementing systems not designed for specific geographies can sometimes create less visible downsides for more peripheral areas of the business. Oftentimes, one such area is the finance department.
Locally, financial controllers must adapt to functionality originally designed for other business cultures. Compromise for the greater good – in generating invoices or processing payments for example – is understandable, but some areas of finance do not lend themselves well to custom adaptation. An example is financial reporting and disclosure, which is regulated at both local and global level through GAAP (Generally Accepted Accounting Principles) and IFRS (International Financial Reporting Standards).
Many ERP systems can, for example, handle local currencies and provide somewhat adequate local-GAAP compliant disclosure. However, they often struggle with the additional step of reporting in other currencies or required formats to parent operations. Despite the significant spend on their ERP system, local accountants still need to download transactions and balances into spreadsheets, manually apply exchange rates, re-arrange the layout of data, and submit error-prone files to corporate managers for IFRS-compliant reporting.
In a cloud-solution world of open API’s and intelligent integration, this is totally unnecessary. Customers should be able to benefit from specialty software that sits on top of the ERP platform, directly producing the accurate reports needed, while protecting the significant investment made in their ERP system.
Mondial CRx, from Mondial Software, is an intuitive, powerful global financial reporting system, that accesses already validated accounting data from the ERP system and uses it as the foundation for providing the high-quality, timely and accurate information needed.
Offered as a web-based subscription service, Mondial CRx can accept transaction-level detail from any combination of globally located ERP-systems. It supports the entry of adjustments needed for statutory global compliance. And it allows users to produce management, consolidated and statutory financial reports in any required presentation or currency format, even if those currencies are not present in the underlying system.
As long as companies find it effective to offshore manufacturing operations, or distribute products globally, then a corporatewide ERP system with access for global subsidiaries will continue to prove attractive. However, this should not mean compromising on regulatory requirements. A solution such as Mondial CRx that fills local and global gaps in financial reporting is likely to provide value-add that ensures the intended benefits of global ERP are felt across the entire enterprise.