When the Financial Accounting Standards Board (FASB) issued new accounting rules that will force companies to rethink their revenue recognition models, Commvault decided it wasn't about to sit around waiting for the new guidelines to take effect.
The enterprise backup software vendor turned to NetSuite's new multi-book accounting feature, which enables a single transaction to hit all of a company's books at the same time. This is critical for contending with numerous industry- or country-specific rules, or for negotiating changes such as the pending FASB guidelines.
Eric Luehmann, financial systems manager at Commvault, knew that the fast-growing publicly traded company would find itself scrambling to comply with the new FASB guidelines, such as expanded requirements on providing comparisons to past sales figures. Public companies must comply starting in December 2016.
Luehmann, who described Commvault's work on this front during a session at NetSuite's SuiteWorld conference in San Jose, Calif., said that even adding just five minutes of tasks for each transaction would result to a lot of extra work for a company that books tens of thousands of transactions each month.
"That's why were getting on this now," Luehmann told a roomful of SuiteWorld attendees. "If we can get ahead of the curve and be ready and more proactive, not reactive, that's going to be a huge time-saver for everyone."
Not that the benefits of multi-book come easily. Luehmann said there have been some challenges during the company’s implementation and testing of multi-book, which he expects with any cutting-edge new software product. For instance, the data migration process hasn't been as smooth has hoped. The onus, he said, is on his team to work through those issues, which is why he called testing the most important part of the implementation.
As a result, Luehmann recommended carefully scoping out the migration path, and giving the organization time to get that part right.
You have to be very meticulous with this," he said. "You can't assume everything's going to be perfect."
Once Commvault has ironed out the remaining issues, Luehmann expects early benefits to include rolling all of the company's statutory books together and ensuring the company's staff has a solid foundation in working with multi-book before the FASB rules take effect. Eventually, he said, he and his team will get into more complex functionality "that we really need and that we have to make scalable."
Naturally, however, the whole effort points back to those FASB rules that will undoubtedly take many companies by surprise. And that's not a position in which any company wants to find itself.
Said Luehmann: "If you don't have something like this, it's going to be a huge challenge to adapt to the new accounting standard."
Learn more about Commvault’s five-month implementation of NetSuite.