Replacing a restrictive legacy environment
WAN NADZIR & CO.CHARTERED ACCOUNTANTS · AF1234Finance Systems
Aligning a New Financial System with Reporting Requirements
A large organisation was replacing its financial system. We assisted in translating its accounting and reporting requirements into practical system specifications while considering transaction processing, statutory reporting and future developments.
Assignment snapshot
Working from different professional perspectives
Considering standards, outputs and integration
The assignment
A system upgrade involving more than technology.
A local authority was replacing its financial system because the existing environment could no longer adequately support its financial reporting requirements or planned system development.
The new system had to handle the organisation's transaction processes while producing information suitable for MPSAS financial statements and related disclosures. The design also needed to allow for future reporting developments and integration with other applications.
The challenge
Bridging the gap between accounting requirements and system design.
- 01
Translate accounting requirements into system rules, data fields and reporting outputs.
- 02
Resolve differences between accounting information produced by connected system components.
- 03
Design a chart of accounts that supports the applicable reporting framework.
- 04
Address legacy information and data-migration issues without carrying them into the new system.
- 05
Consider future reporting, consolidation and system-integration requirements.
Our approach
Bridging financial reporting and system design.
We worked between the accounting team and system developers to translate financial reporting requirements into practical system specifications.
The work covered matters such as financial-statement outputs, the chart of accounts, exchange and non-exchange transactions, automated effective-interest calculations, property-related transactions, reversals, reconciliations and legacy-data issues. Relevant international public-sector accounting developments were also considered where they could influence future MPSAS reporting.
Understand the reporting needs
Identify the applicable standards, reporting outputs, transaction flows and areas requiring accounting judgement.
→Translate the requirements
Convert accounting concepts into clear system rules, calculations, data requirements and expected outputs.
→Review the system design
Discuss proposed treatments with the finance team and system developers, and resolve differences in interpretation.
→Validate the outputs
Review whether system information can support financial statements, disclosures and other reporting requirements.
What we contributed
Accounting requirements expressed in a form the system team could use.
- Accounting and reporting requirements
- Chart-of-accounts considerations
- Transaction and accounting-entry guidance
- Automated calculation requirements
- Financial-statement and disclosure outputs
- Legacy-data and migration considerations
- Reconciliation of system information
- Input on future reporting requirements
The outcome
A clearer basis for developing the new system.
The engagement helped establish clearer accounting and reporting requirements for the system and supported the resolution of differences between accounting expectations and system outputs.
It also provided a more structured basis for producing the organisation's financial statements and considering later changes in reporting requirements.
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