SEC Professionals Group: A Look Inside the Monthly Financial Close Process at the World’s Largest Company

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Walmart Inc. (NYSE: WMT) is widely admired for its operational efficiency, which extends to every corner of the company, including corporate accounting. In advance of the SEC Professionals Group Q2 meeting we sat down with Walmart’s financial consolidation leadership team to learn more about the monthly financial close process at the world’s largest company.

Kristi Brown, Senior Director of Reporting, Consolidation and Corporate Accounting, leads three teams: financial consolidation, internal and external reporting, and corporate accounting.

Heather Trana, Director of Global Close and Consolidation, is responsible for the review and consolidation of financial results for Walmart which operates in 27 countries around the globe. Her Bentonville-based team includes seven associates who support the global close process.

By leveraging technology, automating manual processes and redesigning the financial consolidation team structure, the Walmart team has reduced its monthly consolidated financial close by several days. In addition to gaining process efficiency, they are creating value through additional metrics and analytics that provide insights for their strategic partners in the company.

“Our close is complicated,” said Heather Trana. Walmart U.S. and Canada locations close on a fiscal year schedule that ends January 31, which is typical in the retail industry. The rest of the company’s locations around the world close on an annual calendar schedule.

“This is one of the challenges of our business” she said. “Essentially, we’re managing two financial close processes simultaneously. We’re managing a fiscal close at the same time we’re closing the next period for the international markets.”

The Walmart team has leveraged technology and data automation tools to standardize and streamline the review of financial results that have been submitted across the business segments and markets.

Individual Walmart markets maintain their own general close ledgers. During the month-end close, the markets synchronize their financial statements through an interface to an enterprise financial consolidation tool.

The consolidation software automates certain balance sheet roll-forwards that generate a mostly automated cash flow preparation process. Additionally, automated consolidation rules generate standard U.S. dollar balance sheet and income statement reporting.

Walmart also uses Wdesk to capture a wide range of unstructured financial and performance data from across business segments and markets that is required for financial reporting and disclosure in the 10Q and 10K. This information is captured, collected, maintained and updated from quarter to quarter within Wdesk.

“Our goal is to meet our deadlines for submitting reviewed and final financial statements,” said Kristi Brown. “Those deadlines are accelerating because of the demands of the business and the needs of our executive team.”

The financial statement consolidation process requires the team in Bentonville to coordinate with multiple partners in the company. Walmart recently outsourced a large portion of its shared service center, adding another point of interaction to the process. The team coordinates between internal and external partners, and between U.S. and international operations.

To meet month-end financial close goals all users have access to the enterprise consolidation tool and authorized users have access to Wdesk.

“We have given all the participants in the financial close the right tools to submit the right results the first time. We want to avoid making revisions or adjustments here in Bentonville based on reviews made by the consolidation team,” Kristi said.

The consolidation team also closely monitors the close process for system issues. During the consolidation process, the team may schedule calls twice a day to make sure there are no systems issues in the underlying ERP systems or in the consolidation software that could generate the need for manual work that would threaten the close deadline.

The consolidation team tracks numerous processes and activities that measure the efficiency and effectiveness of the financial close process. “We formally assess our progress and share this information with our leadership,” said Heather.

Among the functions tracked are the performance of technical systems and software tools during each consolidation period.

While Walmart has leveraged technology and data automation tools to standardize and streamline the review of financial results, they also redesigned the consolidation team structure. Today, individuals focus their review of functional areas across all financial statements compared to a review of complete set financial statements for a few markets, which was the past practice. For example, one individual reviews cash flow across all markets to produce the consolidated results of that functional area. The benefit has been a more efficient and consistent review process.

“In addition to efficiency gains, reviewers have become subject matter experts in their functional area,” said Heather. “With deep knowledge and context about a functional area, the consolidation team can create value with additional analytics about KPIs and key business insights for our strategic partners in the company.”

Walmart’s consolidation team has become proficient at balancing an agile focus with a high quality close each month.

“We are constantly adapting our solutions to the changing needs of the business,” said Heather. “Communication is key to leading people through constant change.”

As leaders, Heather and Kristi are committed to inspiring their team and getting people excited about the future. “When you’re changing the nature of a person’s job the challenge is to communicate a vision of what an effective, efficient financial close looks like,” said Heather.

In her communication with the consolidation team Heather emphasizes the personal benefits that technology and process create. “I emphasize their opportunity to make an impact on the organization,” she said.

Looking into her crystal ball, Kristi told us what skills will likely be required of corporate accountants at Walmart in 2025.

She thinks that given how fast the retail environment is changing, accountants will need to be comfortable working in an agile environment and must adapt quickly to change. People will also need the ability to use technology related skills.

“In 2025, this work will require skills sets that are forward thinking,” she said. “The consolidation team will be much more focused on providing quality insights into the data we’re generating.”

A process-focused mindset will be a valuable skill as Walmart continues to reduce manual work and moves toward financial reporting that is seamless.

“We probably will need to hire at least some people with skills sets other than accounting,” she said. “People with process engineering and data analytics skills would make great additions to the consolidation team.”

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