Strategic acquisition: KPIs and leading practices for consolidations
While undergoing a strategic acquisition, there’s a lot to get in order. And when it comes to consolidations, here are the goals we think are most important for your organization amidst this strategic change, meaningful KPIs to track progress, and leading practices to follow.
Goals for your consolidation processes
- Standardized consolidation rules: Aligning on consistent rules across all business units and departments.
- Efficiency in data aggregation: Streamlining how you collect, validate, and aggregate data with controls in place.
Meaningful KPIs to track
- Consolidation cycle time: The time to complete the financial consolidation process post-integration compared to pre-integration benchmarks.
- Accuracy of consolidated reports: Reliability and precision of data and insights in the consolidated financial statements.
- Cost of the consolidation process: Total costs (including software, labor, and other overheads) associated with executing the financial consolidation process.
- Automated data integration percentage: Proportion of data inputs for consolidation that are sourced and integrated automatically.
- Frequency of manual adjustments: The number of times manual adjustments are required during the consolidation process.
Leading practices
- Invest in software that can handle complex calculations, currency translations, and intercompany eliminations efficiently.
- Establish clear ownership and accountability with roles and responsibilities, including data submission, review, approval, and final consolidation.
- Lean on automated currency translation for global operations, ensuring exchange rates are consistently applied across all entities.
See the considerations, KPIs, and leading practices most critical for management reporting.