TopDown Consulting and Logitech

TopDown Consulting Helps Logitech Improve Its Close Process
With Hyperion Financial Management

About Logitech
Founded in 1981, Logitech designs, manufactures, and markets personal interface products that enable people to effectively work, play, and communicate in the digital world. With corporate headquarters through its U.S. subsidiary in Fremont, California, and regional headquarters through local subsidiaries in Switzerland, Taiwan, and Hong Kong, Logitech International is a Swiss public company traded on the Swiss Stock Exchange (LOGN) and in the U.S. on the Nasdaq National Market System (LOGI). The company has manufacturing facilities in Asia and offices in major cities in North America, Europe, and Asia Pacific.

Challenges
Logitech’s previous consolidation system was not reliable. It was a highly customized system and the only support available was from one independent consultant in the U.K.. With continuous breakdowns, there was a constant risk of not being able to close the books.

In addition, Logitech’s business model calls for supplementing internal product development with a combination of strategic acquisitions and industry partnerships. Supporting the company’s expanding operations was becoming more complex and time-consuming. The finance team struggled to manually reconcile intercompany balances as the number of entities continued to increase. With over 30 active currencies, management wanted currency translation adjustments (CTA) analyzed at the account level. They really needed a new system to process financial results quickly and accurately and provide better drill-down capabilities to support detailed reporting and analysis.

Solutions
After a thorough evaluation process, Logitech selected Hyperion Financial Management for its strong functionality and proven stability, and TopDown Consulting for their expert guidance and implementation services. In approximately five months, the project was successfully completed on time and under budget.

The recommended solution involved creating two applications – one to handle monthly consolidations and reporting, and one to manage foreign currency exposure.

• The Monthly Consolidation application performs consolidations and intercompany eliminations automatically. It includes both legal and management reporting structures to provide internal and external views of the company. A dynamic set of core financial reports can be generated at the regional or group level, including automatic production of cash flow statements.
• The Foreign Currency Exposure application measures the company’s worldwide foreign exchange exposure in the balance sheet at the end of each period.

Results
Working side-by-side with TopDown consultants, Logitech’s project team achieved measurable benefits for all levels of their business.

• Executives were impressed with the on-time and under-budget results. They now have confidence in the numbers, and even touted the new system to the audit committee and at a company-wide employee meeting. With the speed and accuracy of the new close cycle, Logitech has accelerated the timing of their quarterly earnings announcement. In addition, the project has created dollar savings by eliminating the need to purchase a separate foreign exchange system.
• The corporate finance group has received recognition because they are now able to complete a worldwide consolidation by Day 3 of the Close. Automating currency translation, intercompany eliminations, and multi-level consolidations has improved the productivity of the group. Since the regions now take responsibility for their own numbers, the corporate finance team can focus on analyzing results instead of just reconciling data.
• Regional finance groups are also more productive. They can enter data and review results as needed, without waiting for the month-end corporate close cycle. Because they now have visibility of intercompany balances in other region’s books, they can identify and resolve issues immediately.
• End users have embraced the system because they no longer have to wait for corporate staff to load data and run reports for them. The use of Hyperion Reports, Analyzer, and Excel Retrieve has replaced many schedules prepared manually in the past. The project team’s comprehensive training program gave users the confidence to master the reporting tools and get the information they need.