Cloud computing has revolutionized the way that companies of all sizes and industries do business, including the financial planning & analysis process. According to a survey by accounting firm BDO, 74 percent of chief financial officers predicted that the cloud would be the factor with the most measurable impact on their business in 2017.
While the benefits of the cloud are by now well-known, migrating to the cloud isn’t the right choice for every organization. It’s for this reason that Oracle continues to offer two versions of its enterprise performance management (EPM) software, one cloud-based and one on-premises.
In this blog post, we’ll explore the differences between Oracle’s software products for financial consolidation and reporting: Hyperion Financial Management and Oracle Financial Consolidation and Close Cloud (FCCS).
What is Hyperion Financial Management?
Hyperion Financial Management (HFM) is a web-based Oracle software application for financial consolidation and reporting. HFM is a robust, mature solution for organizations’ consolidation requirements. It includes features such as cost allocations, intercompany balance eliminations, and currency translations.
What is Oracle FCCS?
While some cloud software is ported directly from its on-premises equivalents, other applications are built completely from scratch. Oracle Financial Consolidation and Close Cloud (FCCS) falls into the latter category.
Oracle FCCS uses the same technology stack as Oracle (E)PBCS, which is Oracle’s financial planning and budgeting solution in the cloud. However, Oracle FCCS also includes elements such as pre-built rules and metadata that are specifically intended for consolidation.
Hyperion Financial Management vs. Oracle FCCS
In our blog post on Hyperion Planning and Oracle (E)PBCS, we found that the cloud version of the software now largely outstrips the on-premises version. However, the opposite is true for HFM and Oracle FCCS, likely because Oracle built the cloud version from the ground up.
Although most of the core functionality of HFM is now available in the cloud, there are still a few features missing, such as:
- Multiple applications: HFM allows users to run multiple instances of the application at the same time, while FCCS requires users to create separate instances in the cloud.
- Advanced consolidation and journals: Oracle FCCS does not support parent currency journal entries or more complex questions about non-controlling interest and partial ownership like equity pickup. While not currently present in Oracle FCCS, these features are slated for future inclusion.
- Advanced custom rules: HFM gives users more freedom to define their own custom rules. However, the core consolidation and translation rules are pre-built and do allow for configuration. Additional rules can also be created, though the list of supported Essbase functions is limited. Additional functions are slowly being added to Oracle FCCS.
As a cloud-based product, however, Oracle FCCS does enjoy some advantages over HFM as well. These include nightly backups, monthly updates, the ability to smoothly switch between cloud applications, and prebuilt reporting capabilities.
Because HFM includes features that have yet to be ported to the cloud, some organizations might want to hold back on an Oracle FCCS migration just yet. For companies who don’t need this advanced functionality, however, moving to the cloud will give you access to the latest updates and put you at the vanguard of Oracle’s FP&A software releases.
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