Cognos, the world leader in business intelligence (BI) and corporate performance management, announced today that a study by Ventana Research, co- sponsored in part by Cognos, has found that finance departments could be more effective in the execution of their accounting cycle and in delivering timely information to improve performance and competitiveness. Consequently, they can benefit significantly from systemic changes to key financial management processes. "Finance departments come up short in two critical areas," said Robert D. Kugel, CFA, VP & Research Director, Financial Performance Management, Ventana Research. "First, a majority are failing to complete their monthly and quarterly close as quickly as they feel they should. Many of the issues they must address to execute a fast, clean and efficient close also will improve financial control and transparency. This, in turn, should allow them to reduce the cost of compliance with Sarbanes-Oxley, both from the standpoint of their ongoing internal requirements as well as their external audit fees. Second, while many corporations have succeeded in addressing the reporting issues of the 1990s, they must focus on the 21st century reporting issues. Employees need far more information about how well they are performing to their objectives. They need more leading indicators to enable them to anticipate challenges and they need more information about external conditions such as the performance of key competitors." The Ventana Research study, which surveyed more than 200 companies across industries, focused on two key areas: financial reporting, and closing and consolidation performance. Highlights include the following: * 80% of respondents indicated they were missing some critical information from periodic reports. * Basic information that companies have traditionally collected is abundant. However, employees are not getting useful information that would contribute to improving their performance. Leading indicators about their company's or business unit's future performance was not available to more than 50% of the respondents. * 57% of companies take more than five days to close the books; 73% believe it should be four days or less. * Spreadsheets are a root cause of longer closing cycles. Less than 10% of companies have eliminated their reliance on spreadsheets which frequently supplement the consolidation and reporting process for core activities like calculation of accruals or translation of currencies. * About half of the companies that limited spreadsheet use were able to close in four days or less, compared to only 27% that used them extensively. Ventana Research estimates limiting spreadsheet use enables a 20% faster closing time. SOX Imperative According to Ventana Research, one of the biggest challenges public companies face is the sustainability of their SOX compliance efforts. Three elements point to this: evidence from year one of Sarbanes-Oxley (SOX) compliance, various public company disclosures about material internal control weaknesses and the study Ventana Research just completed. It is clear systems that were adequate pre-Section 404 fail to provide finance departments with the ability to address evolving demands for tighter and more efficient controls. These systems often involve too many manual steps and rely on inherently uncontrollable systems such as spreadsheets. Organizations need secure data environments to reduce control risks in the consolidation and reporting process. Today's financial reforms also mandate faster closing and quicker production of financial statements. Reducing the cycle time for the closing process has become an imperative for organizations. The Ventana Research study results support the premise that systems and process changes that align with the SEC's shorter filing deadlines for quarterly and annual reports will make sustainable SOX compliance more efficient and lower compliance costs. Focusing on increasing process automation and systems integration gives finance the time required to concentrate on strategic analysis to enhance performance vs. repetitive tasks with limited value. The output is quality information delivered in a timely manner, enabling line of business managers to make quick, reliable, fact based decisions to drive performance. "The Ventana Research study results prove what we have heard from forward thinking customers around the world. Now is the time to renew systems that form the foundation for cost effective, sustainable compliance and timely, accurate and complete performance data," said Doug Barton, vice president, Product Marketing, Cognos. "Improving this core process lays the bedrock for more dynamic performance management and greater competitive advantage." Cognos performance management applications combine the forward management view of the business (planning, budgeting and forecasting) with the current and historical view of the business (consolidations, reporting, and financial analytics.) This integrated operational and financial view across time horizons lets customers proactively address business challenges for greater operational effectiveness. Robert Kugel will join Cognos on April 20 at 2:00 p.m. ET for a Web seminar to discuss the study results and associated recommended actions for customers in detail. For further information, or to register, visit: http://www.cfo.com/executiveforum/index.cfm/l_eventdetail?webcast=3689172 An executive summary of "Financial Reporting and Consolidation: Taking Performance to the Next Level", the Ventana Research study shows how leading companies view the modern challenges associated with financial reporting and consolidation. It will be available following the April 20 Web seminar direct from the Cognos website at: http://www.cognos.com/compliance.