Chart of Accounts Consolidation
Company Profile : Franchisor with over 100 franchisees and 400 properties
Business Challenge :
While all franchisees used the same property management system, they were free to define the chart of accounts to suit them. This made it very difficult to benchmark expenses across the stores. Further compounding the challenge was that while some franchisees used one account to record several types of transactions, others used multiple accounts. For example, Electricity, Gas, Internet, Cell Phones had their own accounts in some cases, while in some they were all charged to a single “Utilities” account.
Solution: Metric-X designed a Chart of Account “translation” table and wrote code to convert each franchisee’s chart of accounts activity to a “standard” chart of accounts. Since there were 40 to 80 accounts in each chart of accounts, not all accounts were mapped to the standard. We started by mapping only the high-activity income and expense accounts. This enabled the comparison of a store’s expenses relative to its cohort stores.
The consolidated chart of accounts provided the following benefits :
- Enabled standardized reporting across franchisees
- Franchisees retained the autonomy to perform accounting their preferred way
- Benchmarking could be done to compare similar stores
- The expenses can be analyzed by multiple dimensions, such as geographic region, metro area, age of store, size of store etc.
- Rent Manager API
- SQL Server