Hyperion Financial Management

Contribution made by Josh Forrest

Overview

As today’s corporate officers can attest, accountability standards are higher than ever, all while stakeholders expectations of accurate results in less time has intensified. Hyperion Financial Management (HFM) helps companies rapidly close their books with confidence by providing analysts with a comprehensive, scalable, web-based consolidation system. By providing a “single version of the truth”, HFM is able to deliver management and statutory reporting while simultaneously allowing users to shift focus away from processing and into data analysis. This user-friendly application employs today’s most advanced technologies, yet is designed to be maintained by the enterprise finance team.

Product History

The HFM product line has roots back to 1983, when IMRS (Information Management Reporting Services) released their first edition of “Micro Control”. The release of Micro Control was considered significant because it used the technology of networks rather than mainframes to operate their software.

1989 produced a crucial step for Micro Control, as IMRS decided to move away from the OS/2 (DOS based) technology and into a Windows based system. The Windows based system was judged to be cheaper and more efficient by end-users of the application. The decision to use Windows prompted IMRS leadership to reevaluate their company name which they believed to be a “handicap”, and in 1991 the Hyperion name was born.

It was believed the new name helped jumpstart the rapid growth period Hyperion experienced during the early 90’s, which included a large increase in software sales and global recognition. Assisting in this growth was Hyperion’s newly designed and developed financial consolidation application Enterprise. Hyperion Enterprise is responsible for the consolidation of financial data and reports, merging multiple general ledgers into a single, integrated system. By 1997, just 6 years after Enterprise was first released, the consolidation application accounted for approximately 60% of Hyperion’s revenues.

During the mid-to-late 90’s, Hyperion Enterprise continued its growth, adding many well-known companies to its user base, but software drawbacks became evident. Many users began outgrowing the capabilities to which the software could provide. Enterprise was built for the consolidation of financials using the client-server architecture, this architecture limited the scalability needed for such an application to succeed within large, complex corporations. The scalability issue also became apparent in terms of deployment, as many users were now calling for web-based operations, and Enterprise offered very little. These setbacks lead to the internal design and development of a new and more powerful consolidation application - HFM (Hyperion Financial Management).

Hyperion launched HFM in 2000, a web-based application built to unify a company’s financial data. HFM includes 12 “smart” dimensions, a web-based architecture, audit trail functionality, and scalability to thousands. The user community for HFM continued to grow since the 2000 release, and was later acquired when Oracle Corporation purchased Hyperion Solutions in 2007. Oracle currently places the HFM application in the “Oracle EPM and BI Products” category under “Performance Management”.

Strengths / Benefits

Faster reporting cycles - HFM enables companies to reduce closing cycles which in-turn allows stakeholders to receive results in a more timely manner.
Observance of global accounting principles - Facilitates adherence to local and global accounting principles such as GAAP, IFRS, FASB, and Sarbanes-Oxley.
Single version of the truth - Reporting benefits from the HFM approach of consolidating financials.
Analytic focus - HFM allows users to spend less time on processing tasks and more time on data analysis.
Straightforward integration - Integration with existing corporate infrastructure and other Oracle products such as FDQM makes HFM attractive to corporate officers and the accounting/finance end-user community.
Market leading data transformation - Hyperion utilizes FDQM (Financial Data Quality Management), an out-of-the-box data transformation tool that populates planning, consolidation, and reporting systems with transformed source system data. FDQM features several capabilities such as ensuring data integrity and straightforward reconciliation to financial data, but it’s strength lies within the internal auditing capabilities – providing audit trails back to the source financial data.
The future of reporting - HFM utilizes XBRL (Extensible Business Reporting Language) to convert data into a standard format. Financial Reporting and the XBRL applications are included with Oracle’s Hyperion Financial Management. This allows HFM customers to consolidate, analyze and report financial data in the newly adopted XBRL format – a format that will be required of large companies beginning in 2009.