Finance transformation assurance services in ERP implementation projects

Jens Sumlak

Director, Finance Transformation Assurance, PwC Switzerland

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Enterprise Resource Planning (ERP) systems, such as SAP S/4HANA, play a key role in streamlining business processes, increasing efficiency, and improving overall organisational performance. However, the successful implementation of an ERP solution is a complex and multifaceted endeavour that requires careful planning, execution, and monitoring. To ensure a seamless transition, guarantee audit readiness and compliance, and maximise the benefits of an ERP system, finance transformation assurance (FTA) services are emerging as a fundamental component of the implementation process.

Data validation and accuracy are key

Finance transformation assurance in the context of ERP implementation refers to a set of systematic and proactive measures aimed at ensuring that the ERP system meets specified requirements and performs effectively across various business functions. FTA services cover a range of activities specifically focusing on audit-readiness including testing, validation, risk assessment, and the evaluation of internal controls over financial reporting. A key focus is on data validation controls, addressing key migration points and potential risks to ensure the completeness and accuracy of data during migration.

Why bother with finance transformation assurance?

The reasons to invest in FTA services are manyfold:

Risk mitigation: ERP implementation projects are fraught with risks, from data migration issues to software compatibility challenges. FTA services help identify potential risks early in the project lifecycle, enabling proactive mitigation strategies such as the digitalisation of the internal control framework. By addressing risks before they escalate, organisations can avoid costly setbacks and delays in the implementation timeline.

Data accuracy and integrity: One of the primary goals of ERP systems is to centralise and manage data efficiently. Finance transformation assurance ensures that data migration, integration and transformation processes are carried out accurately. This not only minimises the risk of data inconsistencies, but also increases the reliability of information across the organisation.

Functionality and user acceptance testing: ERP systems are designed to support various business functions. Finance transformation assurance helps our clients to comprehensively test their new systems to validate their functionality and performance across different modules. This ensures that the system meets the specific needs of the organisation and prevents any negative impact on financial reporting after go-live.

Compliance and regulatory requirements: Many industries are subject to specific regulatory requirements and compliance standards. FTA services play a critical role in verifying that the ERP solution meets these standards. This is essential to avoid legal complications, financial penalties and reputational damage that can result from non-compliance.

Go-live readiness: Ensuring a seamless transition to the operational phase of the new ERP is critical for project success. FTA services ensure the appropriateness of scripts and checklists designed to validate the system’s readiness for production use. In addition, go-live readiness includes the acceptance and approval of testing and data validation results by business representatives, and that the system is secure, allowing access only to authorised personnel during regular operations.

An investment that pays long-term dividends

Allocating 2-3% of the total project budget to finance transformation or quality assurance may seem like an extra spend, but it is a strategic investment that will pay dividends in the long run. The cost of fixing defects, dealing with post-implementation issues, and managing unforeseen risks can exceed the initial investment in finance transformation assurance by far. By proactively addressing challenges, FTA services significantly support the overall success of the ERP implementation and protect the company’s resources and reputation.

Investing in finance transformation assurance is a strategic decision that ensures a seamless, compliant, and audit-ready integration of ERP systems into the corporate landscape.