Comparing different models for financial intelligence processes
To perform financial intelligence processes such as consolidation or currency conversion, you must use a financial model. Planning Business Modeler includes definitions for two kinds of financial models: a financial model with shares calculations, and a financial model without shares calculations. When Planning Business Modeler creates one of these models, it also creates the predefined dimensions, measure groups, and properties that are required to perform the associated financial processes.
To run consolidation with shares, Planning Business Modeler uses values that are stored in the measure groups that are included in a financial model with shares calculation. For more information about the measure groups, see About measure groups for shares calculation and consolidation.
The following topics describe differences between the two kinds of financial models that are included with Planning Business Modeler.
Default dimensions
The following table shows the dimensions that Planning Business Modeler includes in each of these models by default.
| Default dimensions | Financial Models with Shares | Financial Models without Shares |
|---|---|---|
Account |
X |
X |
Business Process |
X |
X |
Consolidation Method |
X |
|
Entity |
X |
X |
Flow |
X |
|
Intercompany |
|
|
Owned Entity |
X |
|
Scenario |
X |
X |
Time |
X |
X |
TimeDataView |
X |
X |
Characteristics of the Entity dimension
The design of a financial model with shares calculations assumes that the model contains entities that have varied ownership relationships with each other and with an overarching holding company. This model includes an Entity dimension with a flat hierarchy in which all entities have the same relationship to the holding company. For more information about these characteristics, see Characteristics of the Entity dimension in consolidation processes.
In contrast, the design of a financial model without shares calculation assumes consolidation does not require calculation of percent of ownership. Thus, the Entity dimension in this model supports multi-level, hierarchical relationships between member entities.
Types of financial processes that are supported
The following list describes how different financial models support financial intelligence processes.
Both types of financial model support the Intercompany Reconciliation (IC) job, which balances transactions that occur between sibling entities. To run an IC job, you must include the Intercompany dimension in the model. In addition, you must define the business rules that perform IC by customizing a template. For more information, see About Intercompany Reconciliation jobs and How do I customize an Intercompany Reconciliation template?.
Both types of financial model support the Currency Translation job, which converts all currencies to a single value. To run a Currency Translation job, you must define the business rules that perform currency conversion by customizing a template. For more information, see About Currency Translation jobs and How do I customize a Currency rule template?.
The two different financial models support consolidation processes in different ways. The following table describes the differences.
Consolidation process Financial Models with Shares Financial Models without Shares Consolidation job
Yes
Yes
Consolidation rules
User-modifiable templates
Default
Percent Consolidation calculation
Determined by shares calculation process
By default, set at 100%t
Default model properties
The following table shows the model properties that are included in the default definition for each model.
| Model Properties | Financial Models with Shares | Financial Models without Shares |
|---|---|---|
Controlling interest threshold |
X |
|
Group Holding Entity |
X |
|
Group Parent |
X |
|
Number of decimal places for shares |
X |
|
Consolidation Balancing Account for Balance Sheets |
|
X |
Consolidation Balancing Account for Profit-Loss |
|
X |
Management Consolidation Elimination account |
|
X |