Perspective:
Perspective
Center for Controllership Blog
Reinventing multi-entity reporting
Creating a multinational modern finance function
As finance organizations modernize, multi-entity reporting may represent an overlooked opportunity to create greater visibility, consistency, and efficiency. Explore how a new approach to operating models, technology, and AI can help organizations rethink statutory reporting and build a more connected, scalable modern finance function.
A blog post by Lakshmi Kant, Drew Green, Emma Ndebele, and Katie Glynn
For multinational organizations, operating across entities and jurisdictions is a fundamental part of doing business. But behind that global footprint sits an equally complex reporting environment—one that must account for different regulatory requirements, processes, systems, and ways of working. As organizations grow and evolve, that complexity can accumulate, often without a clear enterprise-wide view of the effort, resources, and costs involved. Manual adjustments outside core systems can add audit friction and filing risk, while country-by-country processes can make standardization and scale difficult.
For these organizations, multinational statutory reporting may not always be the first place finance leaders look for transformation opportunities. But perhaps it should be.
In today’s globalized market, multi-entity reporting (MER) is essential, giving businesses a centralized view of financial performance and greater visibility into opportunities for the business. Yet this reporting often remains manual and fragmented. Revising MER offers a chance to rethink that statutory accounting model to better support a modern finance function and multinational enterprise.
And several forces are making the opportunity increasingly difficult to ignore.
Why multi-entity reporting—and why now?
For many multinational organizations, statutory reporting has evolved locally rather than being designed globally. That can make it difficult for finance leaders to answer seemingly straightforward questions such as: How much does statutory reporting cost across the enterprise? Where is work being performed? How much is manual? Where are the greatest risks or opportunities for efficiency?
At the same time, some key forces are converging to make MER transformation both more urgent and more achievable: enterprise resource planning (ERP) transformation, artificial intelligence (AI) and automation, regulatory expansion, and cost pressure.
ERP transformations can create a natural window to reconsider the statutory reporting model. Rather than replicating existing processes within a new technology environment, organizations can use the transition to understand how reporting should operate going forward.
AI and automation are expanding what organizations can automate across the statutory reporting lifecycle. Activities that historically required significant manual effort may increasingly be supported by technology.
Regulatory expansion adds another dimension. As jurisdiction-specific requirements continue to evolve, highly localized and manual approaches may become increasingly difficult to scale.
Cost pressure also remains a persistent consideration. Finance leaders are being asked to accomplish more with existing resources, making fragmented reporting an important area to explore for potential efficiencies.
Together, these forces create a space to move beyond incremental process improvements and consider the broader MER operating model.
Finding the right balance between global scale and local knowledge
Modernizing MER does not necessarily mean moving every activity into a single centralized team. The more important questions are: What should be centralized, and where does local expertise continue to add value?
The answer can vary considerably across an organization’s entity footprint.
The key drivers to decide on the right operating model consider two important dimensions: the scale and complexity of an entity’s operations and the complexity of its regulatory environment. Depending on those factors, multinational statutory accounting can range from fully centralized with no local resources to models that maintain local resources or combine centralized delivery with local support.
An entity with relatively straightforward accounting, language, and regulatory requirements, for example, may lend itself to greater centralization. Another operating in a highly complex legislative environment may continue to require local knowledge or external support for complex matters.
The objective, then, is not centralization for its own sake. It is creating an operating model that intentionally determines where work should happen and provides enough consistency to make the overall model easier to govern and scale.
Technology can connect the model. AI can accelerate it
Once organizations rethink the operating model, technology can help connect activities that previously may have existed across disparate systems, spreadsheets, and teams.
A centralized platform can support four phases of the statutory reporting process: sourcing data; transforming and adjusting it; reporting and reviewing; and filing and archiving. Data from ERP systems, data lakes, and offline files can feed a common environment, while GAAP bridging, local adjustments, validation, approval routing, filing, and archiving can become part of a more connected workflow.
AI may embed another layer of possibilities.
Consider regulatory monitoring. Instead of manually tracking developments across dozens of jurisdictions, AI could help scan regulatory changes, map them to relevant requirements, and draft initial impact memos. For GAAP adjustments, AI could help assess materiality and route approvals. It could also generate initial disclosure drafts from underlying data or identify outliers and assist with taxonomy mapping during the filing process.
These applications demonstrate an important distinction: The opportunity isn’t simply to automate the existing process faster. It is to reconsider how the process works when technology can perform or augment activities that historically demanded substantial manual effort.
That could allow finance professionals to spend less time bridging data, checking variances, and drafting repetitive content and more time applying assessments and managing risk.
Turning MER modernization into action
Transforming a multinational reporting model can sound like a significant undertaking, but organizations do not necessarily have to redesign everything at once. Consider some practical entry points for building momentum:
Identify the pain points. Start by mapping the entity footprint, resourcing model, processes, and current cost structure. Establishing visibility can reveal opportunities that may be difficult to see when reporting is managed jurisdiction by jurisdiction.
Anchor internal ownership. Determine who is accountable for statutory reporting—whether that is the controller, CAO, tax organization, or another leader. Clear ownership can provide the governance needed to move transformation forward.
Start the conversation. Bring finance leadership together to examine the current environment, relevant benchmarks, and areas of friction. Creating a shared view of the opportunity can help establish priorities.
Run a value lab. Pressure-test potential operating models and evaluate where changes to process, organization, and technology could create value. This can help translate a broad transformation ambition into a tangible business case.
From local obligation to connected finance
For years, statutory reporting has often been treated primarily as a local compliance requirement. But the convergence of ERP modernization, emerging AI capabilities, regulatory change, and continuing cost pressure provides an opportunity to look at it differently.
A modern finance function’s MER model can give organizations the chance to create greater visibility, introduce more consistency, and make deliberate choices about where work is performed and how technology supports it.
The question for finance leaders may therefore be shifting from How do we continue managing statutory reporting across all of our entities? to How should we design multi-entity reporting for the finance organization we are becoming?
That shift in perspective could be the starting point for turning a reporting obligation into a more connected, scalable, and future-ready finance model.
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