Finantial Manager

Management Control: Financial Manager

Financial Manager was developed by RDS to meet management control requirements by supplying a highly flexible tool guided by customizable settings. Financial Manager allows managers to verify in real-time the cumulative status of revenues, costs and commitments to suppliers with respect to managers’ specific budget objectives. Drill-down techniques, starting from summary data, allow access to the underlying detailed information to be used for each analysis. The system settings rapidly allow users to customize the application to reflect their own business models. Financial Manager is the component of the RDS information system that assists Accounting Managers in the following areas: Cost Accounting: handles Direct Costing, Full Costing and Activity-Based Costing. Sales Analysis: reports and handles revenues by Market/Product/Client/Contract. Profit and Loss: prepares multi-dimensional profit and loss accounts by Market/Brand/Product/ Division/Client/Order, identifying the related contribution margins.
	Data Acquisition
The sources of data for management control purposes are integrated with the RDS information system and they can draw on: Statutory General Ledger: for journal entries (RDS Accounting Manager module). Management General Ledger: for "off book" accruals and deferrals (RDS Accounting Manager module). Expenditure cycle: for commitments to suppliers (orders) and accruals for goods and services received but not yet invoiced (RDS P.O. Manager). Management budgets: for forecasting expenditure and seasonally-adjusted costs not handled in the expenditure cycle (RDS Financial Manager module). Spreadsheets: for transfers from production cost centers to products or orders (RDS Financial Manager module). Allocation of costs: for costs that cannot be attributed directly to responsibility centers for costs or orders (RDS Financial Manager module). Stock accounting: for the allocation of consumable materials and transfers from Production (RDS Inventory Manager module). Assets: for the calculation of monthly depreciation for management purposes, determined with reference to the shelf lives of the assets concerned or the expected volume of production (RDS Asset Manager module). External data sources: for wages, salaries and other forms of cost not managed by RDS modules. Financial Manager allows the various sectional accounts to be closed separately e.g. the adjustments referred to above enable a monthly profit and loss account to be prepared without the general ledger being closed, as the responsibility and requirements may vary for said accounts. In the above example, the cost of goods or services purchased is acquired by Financial Manager from an analysis of invoices to be received contained in the expenditure cycle, and not necessarily from the general ledger. Reporting for Cost Accounting and Management P&L purposes may, therefore, be brought forward to the beginning of the following month, while allowing the accounting department to continue with the recording of purchase invoices for statutory and fiscal purposes.
	Budget
Financial Manager handles both budget and actual data that can be summarized daily, weekly, monthly (not necessarily the calendar month: could be predefined intervals representing weeks of production, quarterly, and so forth.) The Annual Budget can be entered by type or accounting purpose which, using the allocation module, can then be spread over the various analysis periods to reflect the effects of seasonal changes. Financial Manager allows for multiple versions of budgets and forecasts to be generated at the same time, thus facilitating comparison and the analysis of variances with respect to objectives that may change during the accounting year.
	Coding charts (Centers, Orders, Divisions, Accounts)
The codes used by Financial Manager (cost centers, orders, divisions, accounts, etc.) are defined using input settings and held in specific master files. Each basic code may belong to a tree structure which defines the various levels of summarization for reporting purposes. Financial Manager offers settings that allow the user to automate the allocation of codes from accounting and inventory master files for management reporting purposes; e.g. the system could suggest a cost center for a certain type of cost or an order for a given client. It is also possible to create validation grids which flag entries that are allocated in an inconsistent manner.
	Cost Control Models: Direct Costing, Full Costing, Activity-Based Costing
Using input settings, the cost control methodologies required are defined by the user. Once costs have been allocated to centers in the full costing configuration, the system uses the allocation module to transfer such costs from such centers to products or orders using data derived from physical quantities and tariffs. This helps management reporting. Regardless of the configuration, whether direct or full costing, costs can be allocated simultaneously to both cost centers and activities (for Activity-Based Costing) in order to obtain a cross-functional view with respect to the standard responsibility centers.
	Calculation Processes (Spreading and Allocation of Costs)
Using this module, Financial Manager can generate the following types of movements: Spreading of costs based on either fixed (area, headcount) or variable (turnover, quantities produced) figures. This function is defined by the user by applying settings to define rules for cost spreading, and processing can either take place in simulation or in actual mode. Period appropriations and "off book" assessments. These are generated from budgetary information. These entries can be reversed automatically in the next period. Detailed allocation of prepayments and accruals based on seasonal rules.
	Multidimensional Management Reporting
Financial Manager allows for simultaneous recording of entries to multiple accounting destinations: Cost Centers, Contracts, Divisions, Products, Markets, Brands. Multidimensional analysis is performed using the reporting module, which is a report generator that enables the Accounting Manager to be independent when it comes to producing reports. The Financial Manager reporting system can generate printed reports or Excel spreadsheets. This integration with Microsoft products allows the user to query the system in order to make graphs and to interactively choose the fields to be viewed and the look of the display grid.

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