Record to report or R2R is the management process for providing strategic, financial and operational feedback to understand how a business is performing.
This process involves collecting, transforming and delivering relevant, timely and accurate information to all stakeholders inside and outside the organization, to provide insight into how their expectations have been met.
It covers the steps involved in preparing and reporting the overall accounts which are typically stored in a general or nominal ledger and managed by a comptroller. The detailed steps involved are:
- data extraction
- data collection
- data validation
- data transformation (generation of voucher)
- voucher posting (to general ledger)
- storing vouchers in de-normalized and compressed format
- generating analysis account trial balance or consolidated analysis account trial balance
- generating user-defined financial and management reports
In ERP systems , This is part month end process in which basically user will close all the periods and import all the journals in GL from other modules
(Payable, Receivable, Fixed Assets etc.). Then run all the month end GL reports like Trial Balance, Account Analysis etc.
(Payable, Receivable, Fixed Assets etc.). Then run all the month end GL reports like Trial Balance, Account Analysis etc.
Following are broader division of activity involved in Record to Report Cycle
Reconciliations
- Intercompany
- Multiple systems
- Bank
- Subsidiary to main set of books
- Customer
- Vendor
General Accounting
- Journal Entries
- Intercompany accounting
- Book closures
- Trial Balance preparation
- Accruals
- Consolidations
- Cost Accounting
Record to Report process might seem simple but it require considerable efforts. It is the only process scrutinized by outside auditors who draw conclusions about controls in place during financial close and reporting cycle.
