Finance at Microsoft: An Inside Look Robert M. Weede Assistant Corporate Controller robweede@microsoft.com

Finance at Microsoft

Finance at Microsoft: Our Vision Elevate the role of the finance organization to be leaders in shareholder value creation for Microsoft

Expectations of Finance No material weaknesses or significant deficiencies at any period-end Rapid response to remediate deficiencies Control improvements = Process improvements = $$ Efficient implementation to minimize external audit costs Sustainable processes Continued commitment to internal controls by operational and financial management

Controllership Priorities Operational Excellence Financial Leaders Drive Shareholder Value Culture of Teamwork, Respect and Growth Delivering on these priorities with the following strategies Deliver world-class finance and global services that maximize shareholder value while living Microsoft values

Our Quarterly Close Process and How We Leverage Technology

Rhythm of the Business – Another View Week 1 Week 2 Week 3 Week 4 10Q Filed; ER Published General Ledger Closed Financial Statement Analysis Controller & CFO Reviews Drafting of SEC Report Drafting of Earnings Release Disclosure Committee Meeting CEO Certification Audit Committee GL Closed Day 4 Distribution of Drafts 4th Thursday Other Info

Key Challenges Close Process Calendar management Account reconciliations Support documentation and retention Issue management Workflow management Inbox management Information access Reporting Process Workflow management Support documentation and retention Comment resolution Version control Auditor management Statutory compliance Inbox management Information access

Close And Reporting Management: Old World File share system. The problems with this are: 1. Efficiency/Productivity: Depending on size and complexity of the organization and the process, there could be hundreds of folders. * You must know exactly what file you are looking for and what folder it is stored in. * Not easily able to see what’s been completed, what hasn’t. * Not easily able to manage ownership and signoff’s. If you are able to do so, not visibly. 2. Access – Access with file shares is difficult to manage. Requires IT support in terms of managing access at the item or folder level.

The Ideal Solution Flexible Out of the box Simple enough to not need IT help Online environment for distributed access Real time – “Live” Process-oriented, not person-specific Ability to integrate controls Secure

Close And Reporting Management: Current State Single point of collaboration for all group activities Dash board view for management

Close Management SharePoint Site Default view – custom task list in calendar view filtered by user Calendar Management Workflow Management

Shared Documents One location to contain and display common/supporting document for sharing (“One version of the truth”) Document retention for audit trail

Task List Task Responsibility Status Review SOX Controls Technology is embedded in the process (support attachments, evidence of completion, and review)

Individual Task Comments and links as needed Support as attachments Helps ensure completion of all required disclosures Supporting documents are attached to tasks to facilitate review/sign-offs/audit trail/retention Aids both internal and external auditors in their review Comments and links as needed Support as attachments

Review Comment Management One location to enter all review comments/ questions and assign as tasks for resolution Document retention for audit trail

One Calendar One calendar to display all close events and activities Facilitates process flow and due dates

Integration With Outlook Personal Calendar SharePoint Calendar Synch Outlook with SharePoint calendar for seamless calendar view/management in Outlook

10Q/K Reporting SharePoint Site Sub-site of Corporate Accounting SharePoint Separate site for added security and access control of highly confidential financial information Master SEC documents 10-Q/10-K task w/support Documentation of review/validation and quality control procedures

Review Management Review comments/ questions are entered directly on “live” version by reviewers using Word functionality Changes are tracked for review and acceptance Comments are reviewed and addressed with clear trail of resolution for quality control and commenter final review

Version Control Version history Document library contains all versions with proper version indicator Each version shown maintains version history for ability to control changes made to the document

Numbers Certification (Quality Assurance) Final report is electronically certified via tie-out to relevant supporting documents in task list as indicated by tick marks and hyperlinks Use hyperlinks to task lists (and attachments) providing audit trail

Numbers Certification Support = Excel spreadsheet Use of hyperlinks and tick marks Support saved in task list

Numbers Certification Support saved in task list Support = Excel spreadsheet

Security Management Access is fully controlled by site administrator(s) Different site access levels are allowed Owners – full access Members – contribute access Visitors – view only access Item/document level security features available Both internal and external auditors are given “visitor” access to have full view of work performed/ shared documents

SOX Controls SOX controls incorporated into task list Included in list as tasks to be performed as part of Close and Reporting Easily identifiable for monitoring of completion SOX controls incorporated into task list

Quick Stats Approximately 300 tasks contained in site Approximately 250 users Tie out with auditors is less than an hour per quarter

Benefits Achieved Reduced consolidated close by 5 days 2009 annual filing in 29 calendar days Quarterly filing completed simultaneously with Earnings Release XBRL filing completed simultaneously with 10Q/10K Streamlined auditor engagement No significant deficiencies or material weaknesses Reduction in e-mail pileup/enhanced productivity

Getting Started / Key Take Aways As little or as much as you want Ongoing refinement; SharePoint is flexible Initially took us 3 ½ days to set up; ongoing about ½ day

Other Uses of SharePoint within Finance

FinWeb

Earnings Release Support

Controller Workspace

© 2010 Microsoft Corporation. All rights reserved. 4/15/2017 7:48 PM © 2010 Microsoft Corporation. All rights reserved. This presentation is for informational purposes only. Microsoft makes no warranties, express or implied, in this summary.