Accounting Best Practices, Fifth Edition

14–7. Use the General Ledger as a Data Warehouse

When issuing financial reports, a controller draws all of the financial information from a single source, the general ledger. However, there are usually a number of operating statistics, such as headcount, turnover percentages, scrap, and the like that must be accumulated from a variety of sources before they can be brought together into a coherent group and inserted into the financial statements. These can be quite difficult to accumulate at the last moment and must be added manually to the financial statements since they are not stored in the general ledger, the primary source from which the statements are drawn. The reporting problem becomes worse if management is accustomed to printing financial reports on its own, for any operating statistics will not appear on them, necessitating a sudden and unscheduled accumulation of this information by the accounting staff in order to supplement the existing reports. Thus, nonfinancial data can introduce some inefficiency into the production of financial statements.

The solution is to create additional records in the general ledger for the storage of nonfinancial information. This is more commonly known as a data warehouse, since data of all kinds can be stored there. When in place, this arrangement allows a company to store all the operating data it desires in the same place as its financial data, which means that any reports accessing financial data can automatically include operating ...