Sandy wrote the following article for a CFO audience (another version was published in the November issue of Financial Executive magazine). See also Jean Graef's primer on Enterprise Information Architecture, which provides a context for the article below.

Numbers can lie
What could be more orderly and accurate than the data contained in a spreadsheet? Physical appearances can sometimes be deceiving. In the post-Enron era, the integrity of corporate financial data is in the limelight. Unfortunately, this focus can produce precisely the kind of publicity a company does not want–or need–especially during these economically challenging times.

The old adage would have us believe “the numbers never lie.” In the financial world, this is true only if the numbers reconcile both down the columns they reside in, and across the rows of all enterprise and local financial data resource systems. How then, does a company prove its financial data resource to be trustworthy?

Applying library science to the transparency problem
Companies with an Enterprise Resource Planning (ERP) system such as SAP often feel confident that they will measure up. However, unless century-old principles rooted in library science are applied to all corporate financial master data values, the situation may not be as “transparent” as it seems.

For enterprise financial data to be relevant and reliable, it must be comparable and consistent from year to year and from decade to decade. This requires a pre-determined standard for comparability. Financial master data stored in an ERP system can play this role, but only if it is properly maintained.

Bridging past, present, and future

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Created on January 6, 2005 l Updated on July 2, 2006