Managing shareholdings can be complex and time-consuming, especially when manual processes and outdated systems are used. Specialized legal entity management offers a variety of benefits that go far beyond simply managing shareholdings. It helps companies to increase efficiency, improve transparency, meet compliance requirements and make informed decisions. In this article, we highlight the five most important reasons why companies should rely on legal entity management.
Reason 1: Increased efficiency and productivity
legal entity management automates many routine tasks that would otherwise be manual and time-consuming. By automating data collection, analysis and reporting, employees can use their time more efficiently and focus on strategically important tasks.
Instead of manually collecting data from various sources and consolidating it into tables, the software does this automatically. This saves time and ensures that the data is always up-to-date and correct. Companies that use legal entity management often report a significant increase in the productivity of their teams.
Reason 2: Better transparency and overview
legal entity management offers centralized data management that bundles all relevant information in one place. This facilitates access to data and ensures that all departments work with the same, always up-to-date information. Decisions can be made faster and more informed as you have access to the latest data at all times. This reduces delays and enables proactive management of your investments. The software enables a clear visualization of shareholding structures. Complex investment networks are clearly displayed so that you can see at a glance how the various investments are linked to each other. This transparency is crucial for understanding the overall corporate structure and makes legal entity management much easier.
"With zetVisions CIM as the leading system for investment data, we receive sophisticated investment overviews according to our specifications at the touch of a button. This ensures greater transparency for all departments involved."
Oliver Röhl, Head of Group Accounting, Bilfinger Berger SE
Reason 3: Improved compliance and risk management
Specialized legal entity management helps to reliably comply with legal requirements and deadlines. For example, legal reporting is considerably simplified by the software. Reminder functions and reports are created at the touch of a button. This makes cooperation with the tax office and other recipients such as the relevant commercial register, the Federal Central Tax Office, the Deutsche Bundesbank, the recipients of the annual financial statements, etc. much easier. The software also supports compliance with internal guidelines, for example in the case of company acquisitions and sales. All activities and changes are documented with document-based change documents. This facilitates internal audits and communication with external auditors and regulatory authorities. Data protection and security are guaranteed by individual access authorizations. Only authorized persons have access to sensitive data, which protects the confidentiality of the information.
Also read the blog article "Legal reporting in legal entity management - the goal is automation".
Reason 4: Sound decision-making
legal entity management enables informed decision-making through data-based analyses and reports. These tools collect and process large amounts of data and present it in clear dashboards and reports. This gives you a clear overview of the financial and operational performance of your investments. This precise and up-to-date data provides considerable support for strategic decisions. You can identify trends and developments, better assess opportunities and risks and react accordingly. Whether you are evaluating investments, planning mergers or optimizing your portfolio, data-based insights are indispensable.
Reason 5: Cost savings through optimized processes
legal entity management makes a significant contribution to reducing administrative costs by making numerous processes more efficient. Automated workflows and centralized data management replace manual and often error-prone tasks, significantly reducing workload while increasing accuracy. Automating and standardizing processes minimizes errors that could otherwise result in costly corrective actions. Error-free reports and precise data analysis prevent costly misunderstandings and wrong decisions, which leads directly to savings. The software enables a more efficient use of resources. Time and manpower that would otherwise be spent on administrative tasks are freed up. These resources can then be redirected to more strategically important projects. For example, employees who were previously involved in manual data entry can now contribute their expertise in areas such as analysis and strategic planning.
Practical example: How Heidelberg Materials benefits from legal entity management
Heidelberg Materials, a global building materials manufacturer, was facing major challenges in legal entity management. With over 1,300 group companies, manual data entry and reporting was time-consuming and prone to errors. Country-by-country reporting in accordance with Section 138a AO was a particular burden. In 2018, Heidelberg Materials implemented the legal entity management zetVisions CIM, which is specially designed for European and German tax law.
Challenges before implementation:
- Complex international shareholder structure
- Manual, error-prone data processing
- Inadequate software solution that did not meet all legal requirements
The software introduced the following improvements:
- A central database manages all company master data.
- The dual control principle checks and approves important changes to minimize errors.
- The automated standard validation supports error-free data capture.
- The access concept allows more employees to use the participation database.
- The data quality has been sustainably improved, errors have been reduced and the reliability of the data has been increased.
- Tax reporting has become more efficient and meets increased requirements.
- Data availability has been improved and all employees have access to the necessary information, which facilitates collaboration and decision-making.
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Benefit from the advantages of legal entity management for your company
The introduction of legal entity management offers numerous advantages that go far beyond the mere administration of shareholdings. By automating routine tasks and reducing manual errors, you increase the efficiency and productivity of your employees. Centralized data management enables better real-time access to relevant information and ensures transparency and clarity. The software helps you to reliably comply with legal requirements and to identify and minimize risks at an early stage. Data-based analyses and reports support sound decision-making, while optimized processes lead to significant cost savings. Practical examples such as that of Heidelberg Materials show how companies can benefit from these advantages.
"The close cooperation with zetVisions and the ongoing support from a project team were key success factors for the introduction of zetVisions CIM."
Beat Kofmel, Corporate Controlling, M&A / legal entity management, Swiss Federal Railways SBB
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Acknowledgement: Many thanks to Jessica Chin, Senior Consultant Presales & Customer Success, for her valuable contribution to this blog article.
