Report results: how the process runs, step by step

Reporting results for an international group starts once each subsidiary has closed its books and ends when approved consolidated figures reach management, the board and outside users. Local finance teams, group consolidation, treasury and the controller own distinct steps. The hand-offs between them decide whether the numbers hold up.

The steps in order

1. Issue the reporting calendar and instructions. The group controller sends every entity the deadlines, the exchange rate policy, any new accounts and the package template. Changes to accounting policy belong here, not halfway through the close.

1. Close the local ledger. Each subsidiary's finance team posts accruals, clears suspense items and settles open supplier queries. Invoices still waiting for approval, unmatched receipts and disputed payments get resolved or provided for before the period is locked.

1. Submit the reporting package. A local accountant maps the trial balance to the group chart of accounts and loads it into the consolidation tool. The local finance director signs it off. Without that signature the package should not move forward.

1. Agree intercompany balances. Counterparty entities confirm what they owe each other and what they charged. Local teams chase their own differences. Group accounting steps in only when the two sides cannot agree, and it decides which entity adjusts.

1. Translate foreign currency figures. Treasury publishes closing and average rates. The consolidation team applies them to each package and books the translation difference to reserves. Any foreign payments settled during the period should already carry their converted value from the payments system, so this step deals with balances, not transactions.

1. Run eliminations and group adjustments. Consolidation accountants remove intercompany revenue, costs, balances and investments. They calculate non-controlling interests and post top-side entries such as purchase accounting or tax provisions. Every manual entry needs a preparer, a reviewer and a supporting file.

1. Analyse costs. Management accountants break results down by cost centre, project and responsibility segment. Their output feeds the management pack and goes back to the budget team for the next forecast.

1. Report the cash and receivables position. Treasury prepares cash flow projections by currency and flags large expected deposits or disbursements. Credit control supplies ageing, collection status and any debt that has gone delinquent or been written off, so the report shows working capital alongside profit.

1. Review variances. The group controller compares actuals with budget, forecast and the prior period. Entities with unexplained movements get written questions and must answer before commentary is drafted.

1. Draft the report and commentary. The reporting or planning team assembles statements, segment tables and narrative. Commentary should explain drivers in business terms, not restate the movement in words.

1. Approve. The CFO signs off the management version. External results go further, through a disclosure committee and the audit committee, with auditors reviewing before release.

1. Distribute and archive. The final pack goes to its audiences in a locked format. The consolidation team files reconciliations, journal support and sign-offs where auditors and next period's team can find them.

Where the documented version and real practice usually part

The written procedure tends to show a clean line from local close to group sign-off. In practice, intercompany disputes keep running after packages are submitted. Late adjustments arrive by email and get posted as top-side entries, which hides the fact that a local ledger is still wrong.

Exchange rates are another gap. Some entities use the treasury rate. Others quietly use their bank's rate and leave group to fix it.

The review step can also shrink to a scroll through the numbers when deadlines press. That is when errors leave the building.

Questions to ask the people who run it

• Which entity is usually last to submit, and what holds it up?
• When an intercompany difference cannot be agreed, who actually decides, and is that written down anywhere?
• How many manual top-side entries are posted, and could any of them be pushed back into the local books?
• Which exchange rates do local teams really use, and where do they get them?
• Do the cash projections from treasury ever get compared with what actually happened?
• What does credit control send for the report, and does anyone read it?
• Which spreadsheets sit outside the consolidation tool, and who maintains them?
• If the CFO asked for a change after approval, what would happen to the audit trail?
• What did auditors raise last time, and was it fixed or simply explained again?
• Who would know if a package had been signed off by someone without authority?

What to settle before changing anything

Map the real sequence, including the email side channels, before redrawing the official one. Confirm who owns rates, intercompany arbitration and top-side entries, because those are the points where accountability blurs.

Check which downstream users rely on the current format. Board packs, lender covenants and statutory filings may depend on a layout nobody remembers agreeing to.

APQC's Process Classification Framework® (PCF) is an open standard developed by APQC, a nonprofit that promotes benchmarking and best practices worldwide. To download the full PCF or to view definitions and measures, please visit www.apqc.org/pcf.