Companies are then faced with preparing a multi-standard reconciliation and providing explanations of the adjustments. Maintaining and reconciling two or more sets of books is a challenge in itself; then reconciling those books with another set of books with different reporting standards adds an additional layer of complexity. Many organizations struggle with completing this type of reconciliation in a timely manner.
BlackLine’s Financial Close Suite offers multiple options to help companies like Emulex, Merrill and United Technologies prepare multi-standard reconciliations. The Consolidation Integrity Manager (CIM) module allows users to more easily prepare reconciliations between different international financial reporting standards. One standard serves as the base, or underlying reconciliation, and is prepared as a regular account reconciliation, using the Account Reconciliations module (such as U.S. GAAP). Then the other standard’s balance is imported into the CIM module (such as IFRS). If the balance in the base (i.e., underlying) reconciliation is equal to (or within a tolerable threshold) the second reconciliation, that account can be auto-certified.
Alternatively, users can employ the Account Reconciliations module to upload multiple balances (e.g., GAAP, statutory and IFRS) and apply an account segment to identify the balance type. With potentially three resulting reconciliations, they can then complete an additional reconciliation to compare two of the balances (such as the GAAP balance to the international financial reporting standards balance).