November 13, 2007

Hackett: Ongoing Fallout from Compliance Activities Raises Cost of Finance at Typical Companies

Typical Global 1000 Companies Now Spend $138 Million/Year More Than World-Class Companies on Finance Operations; Face Long-Term Challenge in Cost Reduction Efforts

ATLANTA & LONDON, November 13, 2007 - Fallout from compliance-related activities continues to prevent CFOs at typical companies from resuming more than a decade of cost reduction efforts, according to new research from The Hackett Group, a global strategic advisory firm and an Answerthink company (NASDAQ: ANSR).

Hackett's 2007 Finance Book of Numbers™ research found that the typical Global 1000 company saw the cost of finance increase slightly over the past year, and is now spending 12% more than they did three years ago, in part due to increased focus and spending on compliance-related activities. World-class finance organizations, which have continued to reduce costs over Hackett's 15-year research history, are now spending less than half what typical companies do. At a typical $22 billion Global 1000 company, this spending gap now amounts to savings of $138 million/year for world-class companies. In addition, world-class finance organizations operate with less than half the staff in virtually every key area of finance.

Compliance-related activities played a key part in ending the 14-year trend toward lower finance costs at typical Global 1000 companies in 2004, and according to Hackett, it is very likely that typical companies may face long-term challenges in their efforts to continue to reduce finance costs. As a result, the gap to world-class performance is expected to continue to widen. Companies with world-class finance organizations are now spending 47% less than the industry average on external audit fees, and operating with 44% fewer compliance staff.

"What we see in this year's Book of Numbers™ analysis is that typical companies have truly hit the wall, and find themselves hamstrung by the highly complex, non-standardized environments they have created, where processes remain fragmented and technology has not been used to best advantage," said Hackett Senior Business Advisor William Marchionni. "Compliance has brought these issues to the fore as never before, whether companies are dealing with it in the context of Sarbanes-Oxley, the International Financial Reporting Standards (IFRS), or Basel II."

According to Hackett Finance Practice Leader Bryan Hall, "The bottom line is that at world-class companies, compliance has proven to be much more manageable. With highly standardized process environments, more automated controls, and clearer lines of responsibility for internal audit, it's dramatically easier for them to achieve compliance, and for external auditors to verify that compliance. This puts them at a significant advantage. Instead of spinning their wheels on compliance issues, world-class finance organizations have been able to continue to make progress in terms of improving efficiency and effectiveness. They have dedicated themselves to helping their companies make better decisions and act as real strategic partner to their businesses."

In conjunction with the release of its 2007 Finance Book of Numbers,™ Hackett also announced that it is launching an open performance study designed to help executives rapidly and objectively assess their organizations' compliance costs and practices, identify those practices that have enabled top-performing organizations to reduce both internal cost of compliance and external audit fees, and provide the fact base and business context for developing a plan to improve performance in compliance. Companies can get more information and register to participate in the study at the following URL: www.thehackettgroup.com/research/performancestudies

Hackett's 2007 Finance Book of Numbers™, entitled "Performance Metrics and Practices of World-Class Finance Organizations," offers an analysis based on a review of detailed process-level metrics from over 200 recent benchmark studies, virtually all of which were performed at Global 1,000 companies. World-class performers are those that achieve top-quartile performance across an array of efficiency and effectiveness metrics.

The volume focuses on five key areas: Globalization and Its Impact on Finance; Increasing and Improving Business Insight; The Evolution of Shared Services; Securing Superior Returns Through Talent Management; and Taming the Cost of Compliance. The book is available only to members of Hackett's Finance Executive Advisory Program.

About The Hackett Group

The Hackett Group, a global strategic advisory firm and an Answerthink company (NASDAQ: ANSR), is a leader in best practice research and advisory programs, benchmarking and transformation consulting services, including shared services, offshoring, and outsourcing advice. Utilizing best practices and implementation insight from more than 4,000 benchmarking studies, executives use Hackett's empirically based approach to quickly define and prioritize initiatives, and to leverage proven strategies that enable world-class performance. Through its sister company REL, Hackett offers working capital solutions focused on delivering significant cash flow improvements. Hackett has worked with 2,700 major corporations and government agencies, including 97% of the Dow Jones Industrials and 73% of the Fortune 100.

More information on The Hackett Group is available: by phone at (770) 225-7300; by e-mail at info@thehackettgroup.com; or on the Web at www.thehackettgroup.com.