Not only optimizing and automating the financial management process but also bringing outstanding efficiency and accuracy in preparing and consolidating financial reports, CFS – a “Made by FPT” solution that helps close and consolidate comprehensive financial reports – opens up a superior management direction, fundamentally changing the work of closing books, preparing and consolidating financial reports, especially suitable for large-scale enterprises.

CFS solution and the process of “cooking porridge with an axe”

Officially taking charge of the accounting department of FPT Corporation since 2011, Mr. Hoang Huu Chien was soon concerned that the financial management problem would become increasingly complicated as the scale of the corporation grew larger with many different layers of companies. Despite having worked hard but not finding a suitable solution on the market, with his experience and knowledge, Mr. Chien researched, analyzed and designed for more than 2 consecutive years, with the desire to create a solution that is automated to the highest level, minimizing manual operations, supporting the preparation and consolidation of financial reports at the same time for many levels of the company.

Not wanting to “lose a good accountant in exchange for a bad programmer”, Deputy General Director in charge of Finance – Mr. Nguyen The Phuong, initially did not show his agreement because he knew in advance that this job was not simple, full of challenges and would consume a lot of time and resources. Having to accept “because Mr. Phuong was right” but not giving up, Mr. Chien spent all his free time after work, including his days off, to research, analyze and design the solution. During that time, FPT IS also continued to offer a consolidated financial reporting solution that had been implemented for a large corporation in Vietnam; however, this solution also did not meet the requirements set by FPT and Mr. Chien.

Some time later, due to the increasing scale, the increasing number of units and reports, the need for comparison and analysis frequently arose but the ability to respond and provide information was limited, Deputy General Director The Phuong requested to build a report management system to be able to quickly look up and retrieve reports that had been prepared (manually) by unit and by accounting period. “That was the beginning of the process of ‘cooking porridge with an axe’” – Mr. Chien likened.

Indeed, the user requirements for the consolidated financial reporting solution – FPT CFS – started from such extremely simple requirements. During the process of building Mr. Phuong’s requirements, little by little, Mr. Chien gradually proposed to add more requirements and features that he had completed, gradually shifting from Mr. Phuong’s initial requirements to what he already had. Every time he proposed more requirements, as if to add more challenge and caution, Deputy General Director The Phuong asked: “Can it be done?” and of course Mr. Chien’s answer was always “Yes”.

After “cooking the pot of porridge”, Mr. Chien proposed to set up a group to rewrite it in a new language instead of the language he was writing, adding integration features with multiple data sources. The proposed project team was located at FPT Information Technology Department (FIM) to suit the functions and tasks, the personnel were managed by FIM, Mr. Chien directly worked as Project Manager and FPT HO’s accounting staff did the testing.

Since May 2019, after 4 months of development based on the original design with a team of 4 experts, along with the support of the Group’s multi-level information security experts, FPT CFS Solution – with a huge amount of work – has been basically completed and widely deployed at FPT for all member units, saving at least 80% of time and personnel for consolidated reporting, increasing the accuracy of data. With 8 direct subsidiaries, 72 indirect subsidiaries, 9 associated companies and nearly 350 sets of accounting books of all kinds, divided into 6 levels, operating globally, FPT Group currently only needs 1 accountant for financial reporting consolidation and is one of the companies submitting financial reports earliest in the VN30 group.

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Thanks to that, employees who previously spent a lot of time making reports can now spend that time doing other more useful tasks, such as reviewing and optimizing items on financial reports, optimizing the company’s profitable assets, reviewing and accounting for taxes accurately… “Previously, we were a bit ‘abusing’ employees, when they had to work all night and day for reporting work, but now CFS gives them back the right time and functions” – Mr. Chien laughed.

Breakthrough transformation

Mr. Hoang Ngoc Bich – Financial Controller and in charge of consolidating financial reports of FPT Corporation – recalled that before CFS, the consolidation of financial reports of the Corporation and its units depended entirely on the ability to prepare and consolidate reports of each subordinate unit. The correctness or incorrectness of this report depended entirely on the reporting ability of the unit, leading to the Corporation having difficulty covering the data of the unit, not grasping the accuracy according to regulations. In addition, FPT used to have many people preparing financial reports at its subordinate units, requiring these individuals to have a very good understanding of the principles of preparing and consolidating financial reports, leading to a great deal of dependence on individuals.

Currently, CFS has fully supported the consolidation processes and procedures automatically, so the accounting staff at the companies below only need to enter correct and sufficient information, the system will help process the procedures for preparing and consolidating financial reports at all levels. Therefore, the subsidiaries do not need individuals capable of preparing consolidated financial reports to participate in the reporting process, but only need one individual who can oversee the consolidation of financial reports of the entire Group and the units below.

Mr. Bich emphasized that the time to prepare financial reports has also been greatly reduced. Previously, preparing quarterly financial reports was a difficult task, taking months to complete, often requiring extensions to submit reports, and only when the deadline came could the final product be released. Currently, FPT only takes about 5-7 days to produce separate financial reports, consolidated financial reports of the group and all subordinate units.

Regarding the accuracy of the report, with a large number of books and a complex ownership structure, manual work in the past consumed a lot of time and resources for searching and adjusting differences. However, with CFS, the input data is checked, compared and calculated accurately to every penny, there will be no differences that need to be searched for like before. Therefore, the accuracy and timeliness of financial reports are always at a very high level.

“For me, this is an ‘addictive’ product. I don’t know what would happen if I had to go back to manually preparing and consolidating financial reports like before,” said Ms. Do Kim Hoa, Chief Accountant of FPT Smart Cloud. “Previously, preparing separate financial statements and consolidated financial statements, with the goal of honestly reflecting the company’s financial results and complying with accounting standards and guiding circulars, was truly a difficult and complicated task. The time needed to complete the report is also always a big problem, full of pressure”.

Since applying CFS, instead of “struggling” to make reports like before, everything has become much easier. “The fact that CFS automates the entire process, procedures and consolidation entries has reduced subjective errors from humans. CFS also ensures the preparation and consolidation of financial statements accurately down to each transaction, the report completion time is very fast, bringing absolute trust when using the report”.

Most recently, CFS has added a number of modules such as Corporate Income Tax (CIT) Management, Risk Management… to help units quickly plan CIT, calculate CIT, track permanent differences, temporary differences as well as deferred CIT arising accordingly, making the work easier, more accurate and more effective, Ms. Hoa added.
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FPT Software Chief Accountant Le Thanh Van also emphasized the difficulty of consolidating reports when the Software company has many member companies operating in countries and territories, accounting in many different currencies. Previously, data synthesis, currency conversion and financial statement consolidation from member units had to be compiled and prepared many times using Excel for each consolidated report that needed to be issued in a completely manual manner, leading to time-consuming and difficult control, especially when there were errors adjusted at a lower level unit.

After applying CFS, with many improvements in the process of preparing and consolidating reports, data from the accounting software of subsidiaries was automatically updated to CFS, financial statements of foreign units were automatically converted to VND; along with that, the accounting process was standardized, helping to prevent errors from the beginning. Transactions and internal balances at each consolidation level are automatically reconciled and eliminated, ensuring absolute accuracy.

In addition, the purchase and sale of subsidiaries (new establishment, new purchase or dissolution, transfer, etc.) is processed very conveniently and quickly. Even in the case of M&A of a corporation with Goodwill (LTTM), the CFS system also helps to process and record consolidation entries automatically very quickly instead of previously having to spend a lot of time calculating and recording manual entries, allocating/depreciating and bringing them to the beginning of each reporting period.

Reports are automatically compiled and consolidated, the general accountant who does the consolidation of reports does not have to do it manually, helping to save at least 50-70% of time, improving work efficiency. The regular work of the consolidated accountant is only to update the consolidation scope and process a few manual entries such as divesting investment provisions in subsidiaries, profit distribution transactions from subsidiaries to parent companies, etc.

In addition to direct improvements in consolidation procedures and sequences, the use of CFS also helps data to be fully stored on the system, convenient for searching, comparing, analyzing, and providing information quickly to the board of directors in strategic decisions.

Ms. Nguyen Thi Thu Huong – Chief Accountant of FPT Telecom – also agreed that CFS helps the data to be reported on the consolidated report more accurately, can render all consolidated entries in detail, helping to close the data with the Auditor faster because the Auditor has audited the system and trusts the CFS data. Looking up reporting information is also more convenient, the ability to control the data of the sub-ledger sets is also better. In addition, the time for preparing separate and consolidated reports is significantly reduced, and does not require accountants with much experience to participate in the preparation and consolidation of financial statements; instead, accountants in each department only need to ensure that transactions are recorded correctly with pre-built reconciliation and warning tools.

Currently, the CFS solution is not only used at FPT Corporation but has also been commercialized, deployed and applied at a number of large domestic corporations such as Dat Xanh Group, Kim Tin Group, Medlatec Group, Hai An Group, FPT Retail, Synnex FPT… and will continue to be a number of large domestic corporations, because no other solution has the same responsiveness and outstanding features.

Built and developed on a cloud platform based on standards and a highly customizable design, CFS is capable of responding and applying to many corporations operating in many different fields, capable of connecting and integrating with many different accounting data sources, helping the preparation and consolidation of financial statements of corporations no longer be a “nightmare” for the accounting team.

CFS is now ready to prepare and consolidate financial statements in parallel according to both VAS and IFRS standards; accordingly, the solution allows to record and account for differences between the two standards, track and account for temporary differences arising between the two standards as well as the corresponding deferred corporate income tax assets or liabilities.

In the future, the solution will continue to add a feature to help convert financial statements from VAS to IFRS automatically using wizards; accordingly, users only need to declare parameters for calculation models at each time of report preparation, the remaining procedures and work will be completed by FPT CFS.

Thanks to the creativity and relentless efforts of Mr. Hoang Huu Chien and the development team as well as the ability to create challenges and encouragement of Deputy General Director The Phuong, the automatic financial statement consolidation solution has been completed, becoming an important tool in optimizing and automating processes, increasing productivity and labor efficiency. CFS is not only an inspiration but also an affirmation of human capabilities, the effectiveness of technology and digital transformation.