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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 UK. 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.
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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.
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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.
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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.
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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.
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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.
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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.
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