In today’s environment, Controllers must navigate unprecedented disruption and innovation that affects every element of the controllership function: from rules and regulations to enterprise risk management to technology to shared service centers.
Kevin McBride, Vice President of Finance, Principal Accounting Officer, Corporate Controller, Intel Corporation and member of FEI’s Committee on Corporate Reporting shares the topics he is most looking forward to exploring at FEI’s 37th Annual Current Financial Reporting Issues (CFRI) Conference.
FEI Daily: How has your role as Controller at Intel informed the content for CFRI 2018?
Kevin McBride: I'm responsible for the areas that are covered by CFRI every year. It's regulatory compliance with the accounting rules and regulations, the control environment, the enterprise risk management, and finding ways to transform what we do and how we do it to help not only support the business to get the information they need to make decisions, but also high quality information for the financial statements. The way I view my role is, it's not just to protect the assets, but also to provide timely, relevant information to the business and to the shareholders.
I view CCR as a way to, every quarter, discuss things that are very relevant to the controllership. The topics we've been discussing have been the rules and regulations, more so about a year ago, revenue recognition and financial instruments coming online, and we have leasing this year. We've had change in the leadership at the SEC and PCAOB this year. There's been a lot of change, and I think staying on top of that so we can do our job effectively has been an important part of what we discuss at CCR.
We talked about finance transformation, technology, RPA. Those things are vehicles that a controller can use to continuously improve their quality and lower their costs. That's been symptomatic at CCR for some time, and I view the conference as a way to bring that conversation that we've been having at CCR forward to the profession so that we're all having a conversation about the rules and regulations, the control environment, enterprise risk management, and then how do we use tools, technology, process improvements, shared service centers, and other vehicles to continuously improve our quality and lower our costs, while providing our employees a really rich experience for them to get excited to come to work every day?
I just view the conference as a place to have that conversation, and tapping into the SEC, the FASB, the PCAOB, and other industry leaders, the audit firms, to help bring their experience forward to drive that robust and rich dialog.
FEI Daily: You’ve mentioned a few, what are some of the topics you're most excited about exploring at the conference?
McBride: I think there are three that relate to one another. One is shared services or potentially outsourcing, depending on who's on the panel. The second one would be finance transformation. The third one would be some combination of SOX controls or enterprise risk management, there are two panels on each of those topics.
Everybody's trying to do something that's transformation related, but whether it's use of RPA or moving to one ERP at a company, or improving the control environment to be more effective in lowering costs, etcetera, there are many different ways that companies are out making improvements. I'm excited to bring it all together and talk about the various ways the companies have driven improvements to their finance function. It's not a one size fits all. That's the point of having multiple sessions, It's not any one of them that's the answer. There's no silver bullet here.
For us at Intel, we're in the midst of driving our own change, which is really just looking at our overall process of the level of detail that we go, the frequency that we run our processes, and which work day we run the process, and who runs the process. Changing some of the organizational roles and responsibilities, removing stuff more into central functions, where we have people who have relevant expertise versus an army of people who do a certain activity once a quarter.
To me, there's no one clear answer to making improvement other than to take a look at all of the different ways the companies are using controls, using org. design, using tool technology in order to improve the quality of their information, the timeliness of their information, and the costs associated with doing that. Again, I think especially with the new folks coming into the industry, there's a growing expectation that doing the blocking and the tackling, which to me is manual work, goes away. We've got a workforce that's got a shrinking appetite for highly manual and complicated processes. Even with their own teams, we've got to find a way to do it better in order to satisfy the workforce.
I'm excited about the combination of all of that because some companies have done a good job with automation and may not have done so much on the enterprise side, and some companies may have done a lot on the enterprise side and haven't done much with controls or tools. I think it's really just putting it all together for people to pick what's most relevant for them in their environment.
FEI Daily: Where is Intel in that transformation journey? Any lessons learned as you've seen that process continue?
McBride: I'd say we're early in our journey. We're going through our walkthrough of our processes, the identification of opportunities to shrink the close calendar, improve the quality of close, reduce the manual work or eliminate the manual work. We're really in the early stages there.
One of the most important elements, though, is an outside view, so we're using Deloitte to help us on our journey. Getting an outside perspective and looking at what the best in class companies do and then comparing that very thoughtfully, maybe objectively, to really try to root out the non-standard, because it's typically the non-standard stuff that drives the complexity, it drives the non-standard in our systems, which creates a level of complexity for ongoing system maintenance. We're really using that outside perspective to help drive us to something that looks more like a world class process than it does a custom process.
It actually helps us get out of this mindset of, ‘It has to be this way,’ versus, ‘Well, the other companies can do it, why can't we?’ It's a little bit of possibility thinking.
FEI Daily: Tell me a bit about your expectations around the Fireside Chat with Jay Clayton and Wesley Bricker.
McBride: I’d like to get to is a better understanding of their agenda and who the SEC is today versus the past based on a change in leadership and the commissioners. What should we expect to see and why? It would be awesome to get that.