It's no secret that the financial reporting process could be greatly improved in most companies. All too often the process involves rolling up various spreadsheets and reports from customer relationship management (CRM) systems into a financial reporting system and hoping it all turns out right. Starting with this latest economic downturn two years ago, we all discovered that's not going to happen.
Worse yet, most existing approaches are not only prone to errors, they make it very difficult to discern any meaningful trends. IBM, as part of its ongoing campaign to both streamline and modernize the overall financial reporting process, announced today that it has acquired Clarity Systems, a provider of financial management software.
Clarity provides an application environment built from the ground up to support budgeting, forecasting and other financial reporting activities. According to Clarity president and CTO Mark Nashman, there's been a marked increase in demand for Clarity software in the wake of the economic meltdown and cries for more stringent financial reporting. As part of that effort, Clarity supports the XBRL standard for financial reporting and is compatible with Excel file formats.
The Clarity system is designed to not only bring order to the financial reporting chaos, he said, but ultimately give the finance office more transparency into the overall business.
The acquisition of Clarity follows similar recent deals that brought OpenPages and PSS Systems in to the IBM fold. Overall, IBM is trying to bring the worlds of financial reporting, governance, risk management, compliance (GRC) and analytics together in a way that will transform the way businesses operate.
The convergence of these various disciplines should create an opportunity for IT organizations to add unique value to their organization. Right now, GRC and financial reporting are not nearly as tightly coupled as they could be. And there are almost no analytics capabilities attached to either function.
But where many might see chaos, there lies an opportunity to leverage IT to improve the way the business operates. The challenge is bringing the various business functions and the IT department together in a way to enable that.