Finance users require powerful and agile tools to analyze the effects of fast-changing business circumstances and uncertainties inherent in long-range financial forecasts. Many finance departments rely on customized spreadsheets to do financial modeling and impact analysis for these forecasts. Such customized spreadsheet solutions are challenging to manage, lack data transparency and integrity, do not integrate with operational plans, and are not efficient at handling treasury and financial modeling activities.
Scenario Modeling is built-in financial modeling functionality within Planning in Oracle Fusion Cloud EPM that addresses this problem. It enables users to quickly create long-range forecast models for fast-changing business dynamics using built-in sophisticated scenario modeling capabilities and debt and capital structure management features.
However, combining financial and operational data is often the biggest challenge of profitability analysis. It’s typically not prudent to overload the general ledger (making it “fat”) with operational data such as customer, channel, and more that are not needed for statutory reporting. Keeping the general ledger “thin” ensures a streamlined statutory close process. Likewise, manipulating operational and financial data in spreadsheet-based solutions can be very time consuming and error prone. Therefore, these are not ideal ways to address profitability.
Profitability and Cost Management includes robust data management capabilities that enable business users to easily map financial and operational data together. It provides a central hub for automating all allocation-based business processes. The solution is purpose-built for the multitiered allocations typically required by today’s complex business environments and provides a best practice framework to make model-building easy and consistent, with excellent performance.