GE Capital Bank France Unifies French and American Accounting Practices

"Oracle Financials lets us automate our planning process and data consolidation. Our financial planning and analysis staff can fully perform their roles as analysts and work closer with their operational managers--with greater speed and flexibility." --Laurent Plumer, E-Finance Leader for Financial Process Digitization and Automation, GE Capital Bank France

For several years following its 1995 acquisition by U.S.-based General Electric, GE Capital Bank France struggled to simultaneously manage its books in dollars and euros, a situation that was compounded by the need to adhere to evolving French and American accounting regulations.

GE Capital Bank France faced increasing pressure to comply with a number of requirements from its corporate parent and its shareholders--as well as from French banking regulations mandating that the bank's different lines of business follow distinct accounting formulas in their reporting. On top of that, the bank had to provide reports based on two different close dates--one on the last day of the month to adhere to French banking laws; and another on the 20th day of the month to fit its parent company's requirements.

To remedy the situation, GE Capital Bank France implemented Oracle Financials and Oracle Financial Analyzer. Since then, the bank has seen a reduction in the overall complexity of business processes, improved overall management and reporting, and has created a single source data--consolidating duplicate data from disparate locations within the bank's system, while ensuring greater data accuracy.

Solving the Currency Translation Dilemma

Following the acquisition, GE Capital Bank France labored with manual procedures and spreadsheets to submit accounting reports that comply with U.S. GAAP (or generally accepted accounting principles) regulations. "In 2000, we decided to completely restructure our old financial management system, which was incapable of managing all of our constraints," explained Laurent Plumer, e-finance leader for financial process digitization and automation at GE Capital Bank France. "In effect, we had established one accounting practice in accordance with French standards and one in accordance with American standards. And our commercial entities had a different chart of accounts from our banking entities. We had to constantly make the connection between the statutory and regulatory accounts submitted in France and the reports intended for the United States."

Closing the accounts using GE Capital Bank's manual accounting efforts took an unacceptable 20 working days. It also failed to give management the dynamic reporting and financial modeling capabilities it needed to achieve better, faster decision-making.

Oracle Financials lets GE Capital Bank reconcile its French and American accounting standards and approaches, various charts of accounts, and budgetary sessions for each core activity. "It frees us from the mass of manual tasks, requests, and spreadsheets, and works in perfect harmony with our data security policies," Plumer said. Largely used by our financial planning and analysis (FP&A) department, Oracle Financial Analyzer generates dynamic and interactive reports that include drill-down capabilities applicable from net profit/loss accounting through the supporting accounts.

Closing Time Reduced 75%

Oracle Financial Analyzer also provides an outstanding audit trail: Users can switch from one accounting standard to another in just a few mouse clicks. "A lot of companies face constraints in this type of exercise and few can overcome them with such flexibility," Plumer said. "Oracle's capabilities enable us to present instantaneous reports on the transition from one standard to another within all our entities. This functionality is particularly highly valued by our internal auditors, who now have the total visibility they require." Closing accounts now takes only five days, giving management access to current information on which to base their strategic decisions.

Advanced Analysis

Oracle Financial Analyzer automates financial modeling processes for GE Capital Bank France, allowing users to compare proposals for credit programs, look at variations between anticipated and actual results, or carry out sensitivity analyses. And the information can now easily be reported to the parent company in a manner appropriate to U.S. or French regulations. Formerly, these reporting processes required approximately one week's work, compared with a half-day turnaround today.

Another benefit is the improved strategic role of the organization's FP&A department. As Plumer explained, "With all these tools, FP&A staffers can pass beyond the role of Excel spreadsheet creators to become real analysts serving the operational departments."

Why Oracle?

General Electric, the parent company of GE Capital Bank France, utilizes Oracle General Ledger as the standard for its own financial management and for that of its other subsidiaries. In September 2000, GE Capital Bank France adopted Oracle General Ledger for its American accounting practices, eventually deciding to extend its use to the organization's French accounting practices as well. GE Capital Bank France selected Oracle Financial Analyzer as the best solution for its financial modeling and analysis needs.

Implementation Process

GE Capital Bank France implemented Oracle Financials with the support of an internal team based in United Kingdom. Beginning with the implementation of U.S. accounting standards, and later followed by French standards, the implementation took approximately 10 months. Oracle Financial Analyzer was implemented with the assistance of Oracle Partner i-d6.

http://www.oracle.com/pls/cis/Profiles.print_html?p_profile_id=100315