How to Close with Consolidation?

Overview

The financial consolidation close processes involve assembling all business data from various operating activities, departments, business investments, and more to prepare a quality financial statement package that accurately reports your financial position. Whether you do month-end, quarter-end, mid-year, or end-of-year closing, we suggest following the procedure below. 

What are the Steps to Perform a Month End Close

• Step 1: Update User Security
• Step 2: Update Substitution Variables
• Step 3: Update Segments
• Step 4: Update Journal Entries
• Step 5: Update Reports
• Step 6: Add a Currency / Upload Exchange Rates
• Step 7: Update Actual Data Load Months
• Step 8: Data Loading
• Step 9: Consolidation Steps
• Step 10: Reporting

Step 1: Update User Security

Ensure you have the correct access to perform your portion of the close cycle. For example, if you need to work on journal entries or run the Consolidation Process, access Consolidation to open the Consolidation Control Panel and select Security from the lower left pane.

Select a User from the dropdown, grant the security settings to that user, and click Save. 

The Decentralized tab can be used to assign access to a specific company or rollup.

Step 2: Update Substitution Variables

Update the substation variables for @CURMTH@ and @CURQTR@. At the beginning of each new fiscal year, update the @CURYR@ substitution variable. The @CURMTH@ variable refers to the Time segment and is used to map data into reports. 

To learn more about Substitution Variables, click here. 

1. Navigate to Maintenance > Report Administration > Cube Settings.
   
   
2. Select the Substitution Variable tab.
   
   
3. Select a substitution variable, for example, @CURMTH@, and click the Edit icon.
   
   
4. Click the Browse Employee Hierarchy icon to select Time Hierarchy for the substitution variable.
   
   
5. Click Select. Click the Save icon.
   

Step 3: Update Segments

Identify new accounts that need to be added to the common chart of accounts in Planful. Also, identify if any other new segment IDs are needed for newly acquired companies or updates to the department or location dimension.

1. Navigate to Maintenance > Hierarchy Management and select an entity to access the segment hierarchy information.
   
   
2. Click the Add icon to add new segment IDs in the correct location within the hierarchy.
   
   
3. Click OK. Click Save.
   

In the account dimension, the best way to ensure that the account properties are correct for a new account is to locate the position in the hierarchy where the new account belongs and then perform the following:

1. Select an account/entity and click the Copy icon.
   
   
2. Select a different account/entity and click the Paste icon.
   
   
3. Assign the Member Code and Member Name to the new account.
   
   

All of the account properties will be copied to the new account.

Step 4: Update Journal Entries

If there are changes to Standard, Recurring, or Dynamic Journal Entries, perform the below steps:

1.  Navigate to Consolidation to open the Consolidation Control Panel
2. Select the journal type on the Processes pane. 
3. Click the Add icon to add a new journal.
   
   

Note:

You can select an existing journal line and click Edit to modify it.

Step 5: Update Reports

1. Click Reports
2. Open the data load verification report set up in the File Cabinet and Run the report.
   
   
3. Review reports for any changes needed. If new accounts or account subtotals were added to the account segment, determine if additional rows should be added to the reports. If any changes were made in the corporate structure (any new companies acquired or sold), adjust the column sets to add/remove the related company IDs.

Step 6: Add a Currency / Upload Exchange Rates

If you want to add a new currency for any newly acquired company, follow the steps to add a new currency. This must be done before adding the new company to the company segment or referencing this currency in the company properties.

To upload exchange rates, see the Exchange Rate.

Step 7: Update Actual Data Load Months

1. Navigate to Maintenance > Report Administration > Lock Data.
   
   
2. In the Actual Data Load Months tab, select the month(s) to which you will load data and click the Save icon.
   
   

Data will not appear in reporting for any month that has not been checked. If you check future months on this tab where no data has been loaded, you will see negative numbers that reverse out the YTD balance if the future months are displayed on the column. To prevent negative numbers on a report that shows future periods, simply uncheck any future months, and the columns in the report will be blank.

Step 8: Data Loading

Step 8a: Prepare Data Files for Loading

Collect data files from each company showing trial balance account information by year and period, along with the other Planful dimensions. Save the files in CSV, TXT, XLS, or XLSX format.

Step 8b: Select the Data Load Rule

1. Navigate to Maintenance > Data Integration > Data Load Rules. For each file to be loaded, select the appropriate data load rule.
2. Review all settings in the rule by clicking Next on each screen. Once you have determined all the settings are correct, attach the new data load file to the last screen. The last step is to click Finish.
   
   
3. Repeat the data loading steps until data has been loaded for each company for the close month. If anything needs to be edited in the source system, obtain a revised data file and repeat the data load routine.

To learn more about the Data Load Rule, click here. 

Step 8c: Verify Loaded Data

After loading data, validation reports should be used to view the data, showing the data in the account structure. To view the validation reports:

1. Click Reports  
2. Open the data load verification report set up in the File Cabinet and Run the report with the current month.
   
   
3. Verify that the data loaded to each company is tied to the source data file from your company’s system.

To learn more about adding and running a dynamic report, click here. 

Step 9: Consolidation Steps

After the data is loaded and verified, navigate to the Consolidation Control Panel and perform the steps required for Consolidations:

• Process Recurring Journal Entries
• Post Standard Journal Entries
• Post Eliminations
• Process Consolidations
• Process Recurring Journal Entries

To learn more about the Consolidation Process, click here. 

MTD vs YTD Journal Entries

All year-to-date journal entries will be reversed next month in the consolidation module. You will see this in verify data. All balance sheet accounts reflect a YTD balance in verify data. If these accounts were shown in a report with MTD activity, you would see a negative amount on each line item the next month. Amounts in month-to-date journal entries are retained for the current fiscal year.

Retained Earnings

If journal entries in consolidation create net income or loss for the year, Beginning Retained Earnings must be updated in period 1 the following year.

Step 10: Reporting

Validation Report

After completing the Consolidation Process, review the data results in the Consolidation > Consolidation Control Panel > Reports > Validation Status Report:

• Verify that the current year earnings account equals the net income rollup
• Verify that the Planful-only balance account is zero
• Verify that the balance sheet nets to zero.
• Verify that the CTA account has the correct balance.

Journal Entry Report

Navigate to Consolidation to open the Consolidation Control Panel and run the Journal Entry Report under Reports. 

This report will list each journal, depending on the selection. It can be exported to Excel and retained with other month-end work papers and analyses.

Consolidating Balance Sheet and Consolidating Income Statement

1. Navigate to Maintenance > Report Administration > Standard Reports.
   
   
2. Select the consolidating Balance Sheet and Income Statement and click the Run icon.
   
   

• Verify that all Eliminations have resulted in the correct consolidated balance.
• Verify that any adjustments made in consolidation have been appropriately posted.
• Verify that the net income/loss agrees with the source ledgers.

What Do I Do After Close Takes Place

Once the month is closed and all reporting has been validated, Navigate to  Maintenance > Report Administration > Lock Data. On the Lock Data tab, check the closed month so that no further data or adjustments can be made to the period. (Assuming data is loaded for only one month at a time). This also prevents data from being inadvertently cleared.

How to Input Actuals

1. Navigate to Consolidation to open the Consolidation Control Panel
2. Select a Scenario, Period, and Company.
   
   
3. Under Processes, click Actual Data Load. The Actual Data Load grid appears.
   

   
   

4. Select the template, under Entry Actions, then click Input as shown below.
   
   
   
5. The template opens in the Input mode as shown below.
   
   
   
6. Enter actual budget data for the available periods.
7. Click Save.