You're facing financial discrepancies in ERP analytics. How will you reconcile forecasted and actual figures?

Internal Audit: Post Implementation of the ERP system, it is important to have an Internal Audit every month to check the ERP stock and physical stock to see the variance. It is important to identify the root cause to fine-tune and figure out the root cause. This is important to identify 1. if this is variance out of actual consumption and booked values. 2. Production loss and excess consumption 3. Pilferage. A close monitoring will help to reduce these over a period of time. These differences can cause lot of issue to actual financial figures as well as in Material Requirement plan (MRP). If this continues, the big risk is that, team will go back to their Excel sheets.. :(

One of main activities for closin discrepacies is the conitnuous inventories counting. Any inventory discrepancy will impact directly the financial figures. The acceptable discrepancies should not be higher than 1% of full revenues

Reconciliation of financials for the first month after ERP rollout is not an armature’s cup of tea, the consultant must dive into the details and find and reconcile a discrepancy, if the root cause is not reached, it will effect the quality result, it happened with me in one middle eastern project where there was a discrepancy of USD 1/-, equivalent, it took us two full working days by two senior consultant and one finance manager to find and fix the discrepancy, this can happen when you really take good care from the beginning of the project.

Several reasons - inventory discrepancies can occur Warehouse is not using ERP effectively Unit of measure is not set up correctly There is theft - once upon a time - the inventory was selling on Facebook marketplace and craigslist and the employer was able to crack down Cycle counts are not being done on a regular basis

The difference between a forecast and actual is called the variance. The reasons for the variance has to be analysed and justified. In the susbsequent forecasting more accuracy has to be maintained

In a beach sand processing plant, the examination of the alignment of financial process within the ERP system was established. Thereby consistency was brought in. This enabled effectiveness of Standard Costing. Deviations are readily identified and addressed.

Reconciling forecasted and actual figures in ERP analytics can be managed through systematic checks. imagine it like a routine car inspection—you regularly check for issues to ensure smooth operation. by implementing automated system checks, you can regularly compare forecasted data with actual results, flagging discrepancies early. these checks help identify errors, adjust forecasts and ensure financial data accuracy, leading to more reliable decision-making and a clearer financial picture.