Drinking water company Brabant Water wanted to increase the quality of its annual report. Implementing a Disclosure Management solution (SAP DM) not only speeds up the process, but also ensures accurate version management and an automated audit trail. This creates room for focus on the quality of the figures.
"Last year was the first time I came into contact with the process surrounding the annual report," says Henk de Boer, head of Financial Economic Affairs at Brabant Water. With 800 employees, Brabant Water supplies drinking water to 2.4 million residents and businesses in North Brabant. "The version management required a lot of attention and was error-prone. The last straw was the moment I put our version next to the printer's proof and yet a change had inadvertently not been made."
"We wanted to be able to focus on the financial statements rather than on version control," says Adinda te Veldhuis, Brabant Water's AO/IC consultant. "The first priority was to increase the quality of the annual report. We wanted to prevent the auditor from having a different version in his hands than we do," Henk says.
Improving the annual report process
Over time, Brabant Water is also aiming for shorter lead times. "With the possibilities offered by the tooling, you can also implement changes in the process," says Wesley Schulte of Finext. As a Performance Management consultant, he is closely involved in the implementation of the new solution. "Often the potential process improvements become well understood after implementing the Disclosure Management application. These process improvements were not the original reason for the implementation, but they were a great added benefit," says Henk.
"Changes enter the financial statements from the source data in an automated way."
For example, people are better able to take ownership of the new system. "If you set up the solution properly, you can give ownership to the right people. Take responsibility for the texts. Before, these were all done by one person. Now input at the source is possible, which also allows you to put responsibility at the source," Henk says. "The new tool also provides the audit trail that you normally have to supply as an individual. This automates part of my function, allowing me to focus more on quality," says Adinda. "For the accountant, it is nice if the audit trail is carefully recorded," says Naida Sadzak of Finext, also closely involved in the project. As a former accountant, she looks at improving processes from the accountant's perspective.
From source data to financial statements with SAP DM
Brabant Water chose SAP DM, SAP's Disclosure Management solution. A reference visit to Achmea was the deciding factor. "At Achmea it turned out that SAP DM functionally did what we had in mind. We wanted the changes from the source data to automatically end up in the financial statements. The application ensures that the changes are in the right place in the financial statements, both in the text and in the tables," says Henk. "SAP DM holds the versions well; if a sentence or a figure changes somewhere, you see it immediately," says Adinda. "Moreover, we no longer have to think about making a change on page 36 ourselves," says Henk. "After all, everything is linked to the same source."
Dynamic project
A lot was at play during the project. First, the implementation was under great time pressure. "In the summer, we made the decision to do the next financial statements with SAP DM," says Henk, "so we were really in a hurry." Moreover, Adinda, one of the key players, was still on maternity leave during the start of the project. In addition, an improvement around consolidation was also implemented during the project. Brabant Water has three independent subsidiaries: HydroScope, Hydreco and HydroBusiness. "We took the consolidation from extracomptable to intracomptable," Henk says. "Previously we did the consolidation in Excel, now the subsidiaries are also in SAP." "Despite these additional factors, the project went well," says Henk. "Not only was the annual report in the new system ready on time, but also the intended quality improvement was achieved."
Understanding the consolidated figures
In addition to improving quality, improved version control has had a big impact on workload. "We now present version 96 with a 'big smile,'" says Adinda. "Eventually we will go to far fewer versions; right now we are improving as we go. Besides, every text change is a new version." "Standardization of the process can still bring improvements so that the number of reconciliations is reduced," says Naida. Because the process around consolidation has been included at the same time, future improvements are not just in the numbers. "It is also a learning process; before, our colleagues only saw the single figures, now the consolidated figures are added," says Henk. "That takes getting used to." Understanding the consolidated figures is already delivering quality improvements, too. "People better understand the relationship between the parent and subsidiary organizations," says Adinda.
In the annual report, the different worlds of Finance and Communications, as well as IT, come together. "All internal processes must be well aligned. At the start of such a project, it is important to express what we expect from each other," says Adinda. "We often see in practice that departments work as islands on the annual report," says Naida. "By delivering one product together in one process, you engage the other parties more." "Bringing the islands together is an added value of the new solution," says Adinda. "In doing so, it is good to do a baseline measurement first, with an inventory of who has what role in the current process."
More than just tooling
Brabant Water wants to take even more steps around the annual report, for example by taking advantage of the workflows in SAP DM. "You already collaborate with everyone on one document, in which in parallel everyone works on their own chapter of the annual report," says Wesley. "By making good use of the built-in workflow in SAP DM, all stakeholders in the process can work together even better." "A Disclosure Management solution is more than just tooling," says Henk. "We bought it as a goal, but ultimately it is a tool to improve the process."
