4 best practices_using finance applications for better process efficiencies

1. Using Finance Applications for Better
Process Efficiencies and Data Accuracy
BEST PRACTICES
from the Expert Network at

2. INCREASED DEMANDS REQUIRE BETTER
FINANCIAL TECHNOLOGY
Today’s CFOs are expected to do it all: lead strategic
initiatives, manage relationships with investors and other
stakeholders, and help identify and capitalize on new
opportunities — all while maintaining accountability for
all finance, IT, treasury, tax, internal audit and risk
management functions.
As a CFO, there’s a good chance you are saddled with
existing legacy financial applications that are incapable of
efficiently processing the increasing real-time demands of
your business. Legacy systems often rely on manual
processes that are prone to data entry errors. You are not
alone; many of your finance and business colleagues in a
recent survey identified the following as their top
everyday challenges:1
• Importing and entering data efficiently and
accurately from technology silos
• Deciphering model formulas and inaccessible
data sources
• Obtaining timely and comprehensive data from
across the organization
• Accessing models and data simultaneously, as
well as controlling iterative processes and
version changes.
Research also shows that:
• 40% of senior finance executives say their
current information systems can’t analyze
financial and performance data “very well,” and
that management can’t access the information
they need in a timely manner.2
• 74% of best-in-class companies cite automation
of core business operations, functions and
controls as their top strategic action.3
• Over 75% of CFOs are considering upgrading
their existing enterprise systems within a two-
year period,4
a strong indication of the need for
improvements.
Long story short? Identifying and implementing best-of-
breed enterprise-level finance applications that improve
process efficiencies and data accuracy is increasingly
critical to success. These applications can:
• Integrate comprehensive financial metrics from
diverse business units
• Accelerate decision-making by facilitating
enterprise-wide collaboration
• Improve data accuracy and timeliness by
eliminating manual processes
• Reduce fraud and risks through automated
monitoring
• Reduce the time required to perform functions
like the close process and budgeting
• Free finance professionals to focus on value-
added analysis and strategic initiatives versus
rote tasks like data collection and
administration
BEST PRACTICES FOR IDENTIFYING AND
UTILIZING MODERN FINANCIAL APPLICATIONS
The good news? CFOs and their teams are increasingly
able to pick and choose from a broad range of superior
financial applications. Multiple surveys indicate that best
practices for determining the right applications include
the following:
1. Clean house regularly. Regular assessments of legacy in-
house systems and financial practices are imperative. Far
too many CFOs discover patchwork structures, shadow
systems, redundant databases, and process gaps that
actively prevent smooth, efficient flows of information.
Nido Petroleum, an oil and gas company focused on
the offshore Philippines, had legacy systems that were
unable to effectively handle forecasting, reporting or
modeling. Complex spreadsheets were interlinked,
leaving users unable to understand them or decipher
the audit trail to underlying numbers. Nido installed a
flexible performance management system that
allowed data from complex asset-specific
spreadsheets to be imported into the model, giving
the company a single source of financial and key non-
financial data. The finance team got enhanced
reporting and forecasting abilities, as well as real
time cash flow information and P&L capabilities. Risks
from forecasting inaccuracies and lack of transparency
were reduced, and far less time was spent keying data
and double-checking Excel spreadsheets.
1
“Business Planning Survey.” Www.Quantrix.com. Quantrix, 2013. Web.
<http://www.quantrix.com/quantrix/userfiles/file/2013%20business%20planning%20survey.pdf
2
Technology Enabling Business Change: Enable Business Strategy with Technology, CFO Research/ KPMG, CFO Publishing
LLC, August 2013. 14692315.pdf,
3
Aberdeen Group, Timely Insights into Policy Compliance with Continuous Monitoring, April 2014.
4
14694111.pdf. What Is Next for F&A ERP and Information Technology, “The Future of F&A ERP and Information
Technology, “ CFO Research/KPMG, August 2013

3. 2. Focus on automation and integration. There is no way
around it; a single version of the truth requires
integrated, standardized processes. Automated
applications can provide optimal ERP and BI integration,
improved web access and visualization, better mobile
connectivity and integration, real time reporting, and
greater data accuracy.
Queenslanders Credit Union in Australia needed
automation that would permit more efficient
processing, meet compliance regulations, and give
management integrated data reporting to provide
business insights. Led by the CFO, a new platform that
standardized processes and improved data security
was incrementally installed. Manual processes such as
journal uploads, reversals and payments were
automated, greatly reducing the risks of manual
keying and interpretation errors. New reporting tools
allowed executives to develop and manage their own
reports, and information could be quickly accessed
and viewed from different perspectives, with full drill-
down capability to individual transactions.
3. Consider the cloud. You need to evaluate all the risks,
benefits and opportunities of cloud-based systems.
They often provide a lower total cost of ownership
compared to on-premise solutions while providing
superior process efficiencies and data gathering, and far
greater flexibility and agility. Organizations can bring
newly acquired businesses into the fold more quickly
and reduce the risk of pursuing growth opportunities.
Security worries have traditionally held many companies
back from utilizing cloud platforms, but advancing
technology and increasing adoption rates are starting to
alleviate those fears.
• It’s estimated that over 60% of U.S. companies
used some form of cloud platforms in 2013,5
with
most reporting that cloud deployment improved
their bottom lines.6
• Cloud adoption has become integral to business,
with 45% of U.S. companies in 2014 saying that
they already, or plan to, run their company from
the cloud.7
• Current prevailing wisdom holds that reputable
cloud providers can actually provide enhanced
security, compared to what most companies can
achieve independently.
4. Think single systems. A single integrated application for
budgeting, planning, and forecasting can result in a fully
automated process that also provides you with a single
system of record. It allows for far greater flexibility in
budget methodologies (e.g., inclusion of performance
based and driver–based budgeting) while reducing
erroneous data and allowing comprehensive data
utilization. Integrated streams of data and the application
of predictive analytics allow CFOs to provide new insights
into operational, market and customer trends. Companies
following this approach have seen dramatic results in
terms of both efficiency and cost savings
5. Banish spreadsheets from the close. Your financial close
should be automated, centralized, and standardized.
Modern applications allow you to monitor and control the
entire close process and dramatically increase efficiency
by automating tasks such as reconciling transactions,
posting journals, and consolidating data from disparate
systems. The result? A faster close with fewer errors and
simplified reporting.
Chicago Tube & Iron, one of the largest distributors to
the steel services industry in the U.S., wanted to
eliminate year-end fiscal blackout periods and allow
for multiple fiscal periods to be open simultaneously.
Report writing for post-close reporting needed to be
simplified, as did the ability for accounting staff to
post to the general ledger. Finance wanted to
integrate operating data with ongoing financial data
management, and executives wanted more dashboard
reporting. The company chose a financial enterprise
system and successfully executed an accelerated
implementation time of three weeks. Preparation time
for the CFO’s monthly report fell by 40% and ad-hoc
reporting time was reduced from two days to a few
hours. Finance gained the ability to monitor and
adjust financial and operational data on a daily basis.
Conclusion: Modern Finance Applications Can Make a
Demonstrable Difference
Businesses today require CFOs and their teams to handle
an ever broader and more complex range of financial
functions. In order to successfully meet these increasing
demands, finance departments require modern
applications that can improve process efficiencies and
ensure data accuracy. The identification and
implementation of appropriate financial applications can
result in almost immediate impacts, including accelerated
ROI; greater productivity; better business reporting,
analysis, and insights; stronger financial controls;
improved risk and fraud reduction; and a more agile and
responsive financial team. The net result? You, your team
and your company can all profit handsomely.
5
Emison, Joe M. “Research: 2013 State Of Cloud Computing - InformationWeek Reports.” Information Week. UBM Tech,
02 Apr. 2013. Web. 22 Oct. 2014.
6
“The Cloud Enabled Data Center.” White Paper (2013): p.1. Panduit Corp., May 2013. Web. <www.panduit.com>.
7
“2014 Survey Results: The Future of Cloud Computing,.” Northbridge. Northbridge Venture Partners, GigaOM Research,
May 2014. Web. 18 Aug. 2014.