Impact of Digital Revolution on Financial Reporting
Financial reports represent the trajectory of where the business is going. Although technology has evolved over the years, it seems as if this fourth industrial evolution is yet to reach the Finance function. Finance has been very slow to adopt new enabling technologies in order to drive financial process efficiencies. Finance teams still make use of “stone age” reporting tools such as excel to prepare monthly management reports.
The value lost due to using old manual process in unbelievable such as manually consolidating company financial performance results. There is more value the finance function can add to the company if more time is spent in analysing the financial results, however 90% of the time is spent on preparing these reports in in excel or old financial reporting systems.
Head Office usually wait for subsidiary/ division companies to send through their management packs for Group consolidation purposes and unfortunately at times, the reports contain errors.
Head Office sends the management pack back to the subsidiary for rectification. If the latter is unable to rectify the errors, it automatically becomes the Head Office’s problem
This back-and-forth process results in unnecessary effort, time waste and low ROI for time spent by finance on analysing and giving appropriate financial direction the company should take.
Excel will most likely be part of analysis for the near future however there is a place for Excel and not all financial functions are easily or meant to be performed with Excel. Finance executive need to acknowledge the limitations of manual extraction processes and leverage financial consolidation software.
Automating consolidation functions results in reduced cycle times of discrete tasks, more accurate results at a lower cost, increased ROI time spent on analysis than that of preparing reports and provides management with improved visibility and control, allowing for improved and quality decision-making.
Stop Wasting Resources
The current processes companies use of manually assembling and reviewing financial reports require both time and money. With the availability of technology to sift through data and crunch the numbers, management is in a better position to perform faster and better analysis. When some time resource is freed up, CFO’s and financial managers can analyse more on the business performance, build strategies to ensure continuous growth of the company, which would support better-informed management decisions. Greater efficiency with higher-quality management decisions is a win for companies and economy as well.
Time for Change
The current technology presents an opportunity for finance teams, provided they embrace these tools. Businesses will still have roles in which insight, transparency, stewardship, and ethical corporate conduct are valued, and strategic finance professionals can fill these roles. Risks remain, but mainly for those who fail to appreciate the new tools and get left behind. Finance professionals must live with this changing, disruptive environment and explore opportunities.
Benefits of Automation for financial reporting
1. Improves financial statement accuracy
2. Improves productivity
3. Increases opportunity for higher returns
4. Allows for better risk management
5. Empowers the analysis
Quick Consols Proven Alternative
Quick Consols is the proven alternative to excel spread sheets and inefficient costly legacy reporting applications. The change to using Quick Consols is easy and will not cost an arm and leg.
Quick Consols simplifies Group/ divisional financial consolidation, reporting, analytics and financial analysis for any organisation. Deployed via the cloud or on-premise.