Conditional Line Item Names & Variance Verbiage

What is Dynamic Narrative?

Dynamic narrative is the practice of allowing text within a report to automatically change based on underlying data or business logic. Rather than manually updating wording each reporting period, the narrative adapts as the data changes, helping ensure consistency and accuracy.

Why Implement this?

Preparing financial statements often involves manual review of narrative and line item descriptions after each reporting period. Without automation, preparers must manually review these disclosures every reporting period, increasing both preparation time and the risk of inconsistencies. Two common examples are:

Financial statement line-item descriptions that can dynamically change based on whether the underlying value represents a profit or a loss.

Common Examples: Gross Profit/Loss, Operating Profit/Loss, and Profit/Loss Before Income Tax

Narrative disclosures that describe movements between periods

When to Implement this?

Dynamic narrative is considered a Workiva best practice and should be incorporated into every implementation. At a minimum, it should be configured for applicable line items on the face of the financial statements and/or provided as a reusable Spreadsheet template for use in relevant disclosures. This reduces recurring manual review, promotes consistent wording, and helps ensure the narrative remains aligned with the underlying data.

Use Case 1 – Conditional Line Item Names

Business Challenge

Certain financial statement captions are conditional on the values reported. Without automation, these captions require manual review every reporting period.

Technical Approach

The solution consists of three simple components.

Step 1 – Create a lookup table

Create a small lookup table containing the four possible scenarios

Step 2 – Determine the correct scenario

Create a helper column that evaluates the Current Year and Prior Year values and returns the appropriate value from the lookup table.

 =IF(AND(I7>=0,J7>=0),O7,IF(AND(I7<0,J7<0),P7,IF(AND(I7>0,J7<0),Q7,IF(AND(I7<0,J7>0),R7,0))))

Step 3 – Build the final line item

Concatenate the static portion of the line item with the helper column

Result

Following each Refresh, the line item description automatically reflects the Current Year and Prior Year values. No manual review or updates to the financial statement captions are required.

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Use Case 2 – Variance Verbiage