We’ve talked about why Oracle Account Reconciliation Manager (ARM) is a popular tool among leading finance departments — because organizations are automating their time-consuming, manual account reconciliation processes to reduce risk and increase efficiency. Oracle ARM not only automates the process but fully integrates it with the financial close workflow for optimal performance.
Making the most of Oracle ARM requires an implementation that sufficiently prepares the organization for new and improved processes. Below are three must-haves for a successful ARM implementation.
1. Standardization of current process
A well-defined account reconciliation policy or process is essential when deploying Oracle ARM. This module is a strong reinforcement for SOX compliance, adding greater depth to your reconciliation process with certification questions and detailed account analysis. The visibility and access of all attachments and supporting documentation makes the process efficient from an audit perspective. Consequently, development time will be reduced because the implementation team can recreate the company’s existing process in ARM, as well as suggest ways to strengthen the process with the functionality of ARM.
A standardized chart of accounts at the ERP level will make user adoption much easier across business units and locations. With this standardized chart of accounts, the company can apply a “parent account” reconciliation process, which will establish a baseline for accounts to reconcile in the same way. (For example, all cash accounts throughout the company will reconcile with a uniform methodology.) During the requirements gathering and development phases of ARM, a company needs to be open to self-reflection, which requires strong leadership to drive change management throughout the company.
A successful deployment of Oracle ARM requires a strong partner in the company to drive change and optimize user adoption of the application. For example, the process to deploy ARM requires FDMEE, which is an extract, transformation, loading tool that pushes balance sheet account detail to ARM. The addition of these two applications will change the close process for individuals involved. Without strong leadership, the positive change that ARM brings to reinforce SOX compliance can be negated by the end users that perceive it as a change causing more work. Companies would be wise to leverage a trusted advisor to partner in the change process and to ease the transition for end users into the system.
3. Clean source data
FDMEE is the application used to load account balance data to Oracle ARM, and it requires clean source data for accurate data loads. As mentioned above, strong leadership is required to ensure source systems house clean data that can feed into tools such as FDMEE, ODI, and data marts. An experienced consulting firm can architect a world-class financial system, but without clean source data, no architect can bring to life what is found in muddled accounting processes or poorly designed account structures. Sound data load processes are necessary for an efficient reconciliation application.
Oracle ARM is a powerful tool that will help to drive standardization and improve processes. It cannot, however, create an accounting policy properly balanced for risk mitigation; that is an essential element that must be established prior to the deployment. Without a well-defined policy and process, additional development time will be required due to potentially multiple cycles of development, analysis, and approval. Strong leadership comes into play in order to drive the change necessary to help end users adopt ARM.
Implementing ARM will naturally spur changes in the reconciliation process. For example, scanned attachments, certification questions, and comments are elements of the reconciliation methodology that will likely change once incorporated within a company-wide solution. It’s important to anticipate barriers to change and focus on positive results: less face-to-face time with auditors, fewer research requests, and lower risk assessments with external auditing firms.
With an experienced implementation partner applying the best practices above, an ARM deployment typically takes 6–10 weeks. Learn how one company deployed Oracle Account Reconciliation Manager to achieve greater access, control, and governance when it comes to monthly account reconciliations.