The Road to Business Success During Volatility: Modern Financial Reporting & Analytics

Whether there is an economic upswing or there is uncertainty, as there is now, business moves quickly. Often, based on the best facts they have at the moment, CFOs and executive teams create a plan that is a snapshot of what they anticipate will occur. But what happens when actuals deviate from the plan, either favorably or unfavorably, as they will undoubtedly do?

Every organization needs to be aware of variations as soon as they happen so they can either seize unanticipated possibilities or prevent losses. Therefore, having a solid, accurate financial reporting process is more crucial than ever so that you can make significant decisions for your company in the coming days, weeks, and months.

In the beginning, course correction calls for more than just identifying monthly variations. To comprehend why differences happen, managers must have the ability to go deeply into the origins. The business management, not the finance team, should frequently conduct the investigations. Accordingly, a company’s functional leaders, such as the VP of Sales, Customer Care, and Operations, must also be able to run reports that track the performance of their divisions.

But each month, financial teams must close their books before anyone can look at the data. This can take some time because it’s challenging to generate the reports needed to validate and explain the results. For instance, ERP systems excel at gathering data but struggle to provide it to business users for analysis since they are unable to produce the required reports. As a result, a lot of customers use spreadsheets to learn more about what transpired.

Use of Spreadsheets: Problems

It’s dangerous to rely just on spreadsheets to report variance statistics. To begin with, gathering the required data manually, entering it into the spreadsheet, creating pivot tables, and other tasks take too much time and effort. Furthermore, it’s rare that a single data source will offer sufficient knowledge to account for a deviation. Furthermore, complicated formulas that users utilize to interpret events frequently fail.

Let’s Talk About Modern Financial Reporting

Financial reporting tools assist business managers to make better decisions more quickly by delivering timely and accurate data in visually appealing reports and dashboards as part of a contemporary FP&A process.

 

These technologies function as a data warehouse, bringing in information from numerous systems like as CRM, payroll, ERP, GL, and others. All data is normalized so that it can be stacked and provide complex perspectives on the company and all of its dynamic components. Additionally entirely automated, these technologies do not require data entry, which is labor-intensive and prone to mistakes.

Why Modernizing Your Process Is Beneficial

Moving Past Static Reports

Traditional financial reporting focuses mostly on data from the past, such as the most recent month, quarter, or year. In order to inform forecasts, it is frequently used to compare actuals to plans.

Displays of performance data

Dashboards enable you to arrange and show data in various ways as part of a modern financial reporting process, making problems immediately obvious. They run on an analytics engine that enables users to go deeper into the data set to comprehend why things happen the way they do. For instance, a dashboard may easily display that the Chicago sales office is 20% behind schedule.

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