Plansmith Blog

Managing Consolidated Performance Objectives: Why A Unified Software Platform Is So Important

Posted by Brett Hendricks on 7/8/20 9:00 AM

As Plansmith’s ‘budgeting software’ evolved from its onset in the early 1970s, it became referred to as a ‘profit planning model.’ This distinction was made because it was much more than just balances on a spreadsheet or basic historical trends cast forward for the next year.

We went many steps further and melded together data from the bank’s or credit union’s general ledger and core system maturity, cash flow, and re-pricing data. This interaction was significant to creating a true financial model – one from which the user could help guide future business decisions. They could see future roll off and loan exit rates, test different loan and deposit pricing, and immediately see the impact to portfolio yield. They could even compare multiple variations of the budget. This was and remains today what some call ‘predictive modeling,’ and can be essential to the growth and financial health of a bank or credit union.

The key lies in fully integrating all of this data into one unified financial database. This evolutionary structure that captured all the detail from the organization’s core financial data could be used within multiple areas of the organization. Everything from managing consolidated performance objectives to branch profitability, all the way down to complying with FDIC or NCUA regulations.

With a unified database and system, one push of a button can produce:

  • Budgets and Longer-Range Financial Forecasts
  • Comprehensive Board and ALCO Reporting
  • What-if Budget and Stress Test Scenarios
  • Asset Liability and Interest Rate Risk Analytics
  • Liquidity, Cashflow, and Contingency Funding Planning

In addition to a fully-integrated platform, the bank or credit union no longer has to worry about data integrity. All operations are generated from the same database, share the same input, and are updated and revised automatically – without the errors commonly found in spreadsheets or disparate systems.

So, the $64,000 question – which is best? A Financial Planning and Reporting Partner who offers fully-integrated solutions linked to your core system data? Or multiple vendors and systems that are not connected in any way and are all running off of different data sources?

I’ll have to leave that up to you.

If you're interested in learning how Plansmith's fully-integrated system could help your organization, click here to schedule a discovery call.

Topics: community bank budgeting, community bank planning, credit union planning, budgeting, credit union interest rate risk, credit union budgeting

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