wgv Versicherungen found that its existing annual and regulatory reporting and controlling processes, which relied on error-prone manual data transfer, would not fulfill changing, stricter requirements.
wgv worked with partner PPI to implement financial performance and disclosure management solutions from IBM, freeing staff from manual data transfer and boosting the efficiency of financial reporting.
3xfaster to generate financial reports, resulting in greater productivity
Simplifiescompliance, reducing the risk of penalties
More accurateannual reports; higher level of automation eliminates risk of human error
Business challenge story
Under the spotlight
In recent years, consumers have become increasingly savvy about the wider business practices of organizations they choose to engage with. The insurance industry is no different, with participants needing to fulfil a changing and growing set of financial reporting requirements or put themselves in danger of penalties and—worse—reputational damage.
To comply with industry, government and European Union (EU) regulations, and satisfy risk-aware consumers, wgv must produce a wide range of reports detailing group activity every quarter. In the lead-up to the introduction of Solvency II, an EU-wide insurance reporting regulation, wgv recognized that its existing procedure for creating reports would not be up to scratch.
Hartmut Schöch, Head of Finance, Accounting and Controlling at wgv Versicherungen, takes up the story: “Today, it is mandatory for all EU-based insurance companies to produce detailed reports on risk and capital requirements. Some years ago, we realized that Solvency II would put a significant strain on our reporting processes and that we would not be able to reliably fulfill the legal requirements for data integrity.”
When gathering data for reports in the past, employees had to manually transfer data from SAP accounting applications into Microsoft Excel spreadsheets before re-entering the financial figures into Adobe InDesign for final layout.
“Unsurprisingly, this was an error-prone procedure,” says Hartmut Schöch. “Having several different stages of manual data transfer resulted in a lot of inconsistencies and a lengthy validation period. It was an iterative, inefficient and time-consuming process that was becoming increasingly unsustainable as the company grew and data volumes increased. What’s more, it meant that last-minute adjustments to financial figures requested by top management or our accountants were extremely difficult to complete within deadlines.”
To eliminate the risk of error, accelerate report creation and ensure that it could meet strict Solvency II deadlines and data requirements, wgv looked for a way to reduce manual workloads.
Achieving greater transparencyAfter evaluating its reporting workflows, wgv decided to implement IBM® Cognos® Disclosure Management to streamline processes. After training sessions delivered by IBM Business Partner PPI AG, wgv was ready to put the solution to work.
Hartmut Schöch recalls: “Setting up the new processes based on the IBM solution was very quick and easy. Today, data from SAP financial applications is imported into IBM Cognos Disclosure Management where we can combine it with narrative analysis of the financial figures. Because data has not been copied-and-pasted or manually re-entered, we can be sure that the figures are accurate and correct. This makes the validation much simpler and the whole process much faster.”
Tight integration with Microsoft Office solutions, such as Excel and Word, enables wgv to edit and format the report narrative directly in IBM Cognos Disclosure Management without the need to learn to use completely new tools.
Hartmut Schöch explains: “All of the financial figures imported into IBM Cognos Disclosure Management—typically around 5,000 different variables for an annual report—are combined with narrative analysis directly in the solution. This means that standard texts describing performance or market position are automatically updated to include the latest numbers. It even picks up on related words such as ‘increasing’ and ‘decreasing’ and updates them to reflect the latest situation. Once ready, we simply export the report to Microsoft Word and send it on for formatting and printing.”
He adds: “The close integration with Microsoft solutions was one of the features that initially attracted us to IBM Cognos Disclosure Management. Being able to switch seamlessly between Cognos and the tools we are already so familiar with makes life a lot easier.”
wgv also implemented IBM Cognos TM1® as a budget planning and analysis tool, which is used as an additional data source for IBM Cognos Disclosure Management—in fact, all planning figures for Solvency II reporting are taken directly from TM1. In addition, the company uses IBM Cognos TM1 to support business planning and reporting, as Hartmut Schöch notes: “We produce five-year business plan reports covering income, profit and loss, and cash flow using TM1. And because data from SAP applications is transferred to TM1 every month, we also use it to prepare monthly forecasts and deviations. IBM Cognos TM1 is a central pillar of our monthly reporting process.”
Enabling solid complianceWith IBM Cognos Disclosure Management, wgv can produce high-quality, highly accurate reports more quickly and easily than ever before. This enables the company to provide top management with a draft report about one month earlier than in the past—providing earlier insight into financial performance to support decision-making.
“The entire report creation process is much more efficient,” says Hartmut Schöch. “In the past, my team wrote and reviewed all the text. Today, we can set up flexible workflows where insurance specialists and mathematicians can draft sections, and we only polish them for publication. Critically, staff no longer have to spend time endlessly copying and pasting data from one system to another, but can work on more productive, value-added tasks. As data is now all directly imported in IBM Cognos Disclosure Management, generating reports is a lot less time-consuming—we save weeks. In fact, we can now produce reports three times faster with the same headcount, helping us to comply with regulators’ challenging demands while keeping our costs flat.”
wgv also took the opportunity to standardize reports across all group companies. Today, staff write sections once and reuse them in reports for subsidiaries. This alone reduces the workload for reports of many group companies by 50 percent.
“We’re not just producing more reports, we’re producing higher-quality, more accurate reports,” remarks Hartmut Schöch. “By removing manual data transfer processes, we have successfully eliminated the risk of human error. What’s more, adding additional data at a later stage no longer throws a spanner in the works, as the financial figures are automatically updated. The first run of an annual report, which contained more than 5,000 variables, contained no mistakes whatsoever—a fantastic achievement.”
Critically, the IBM Cognos Disclosure Management solution ensures that wgv will meet the data integrity requirements to comply with Solvency II.
Hartmut Schöch concludes: “The quality and consistency of reports has improved remarkably with IBM Cognos Disclosure Management. The IBM solution makes it quick and easy to deliver highly accurate financial reports with a fully auditable data trail, ensuring that we comply with all manner of regulations, and protect the hard-earned trust and loyalty of our customers.”
Württembergische Gemeinde-Versicherung a.G., also known as wgv Versicherungen, is a mid-tier German insurance company headquartered in Stuttgart. The company provides a wide range of insurance products and services—from liability, household and car insurance to pension and income protection—to 1.3 million customers. wgv employs around 900 people and reports annual revenues of more than EUR 650 million (USD 730 million).
- Cognos Disclosure Management
- Cognos TM1
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IT consultancy and services provider PPI AG has been successfully working for banks and insurance companies for more than 30 years. Headquartered in Hamburg, Germany, PPI employs more than 400 people. To learn more about products and services from PPI, visit: www.ppi.de/en
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