Close the books faster with a data program that takes your finance team into account
August 13, 2020
From closing the books every month to wrapping up the fiscal year, effective financial reporting fuels every business.
Without the clear, accurate, and timely results of day-to-day record keeping, organizations lose more than a view of critical functions. They’re unable to identify and implement the fresh ideas that will take them into the future.
And yet, as companies modernize their operations with data warehousing and business intelligence, their own finance teams are often overlooked. That team’s processes may be hard for analytics teams to understand or simply overshadowed by the squeakier wheels in marketing and sales. But finance is equally critical to a successful data modernization effort. By operating with this blind spot, companies are missing key efficiencies for a pivotal part of your organization.
Despite often being perceived as less computer-savvy, accountants and finance professionals are voracious consumers of data. And, through working in Excel and downloading reports from multiple sources to reconcile monthly totals, these teams are data-literate. They will quickly understand the value of proper governance.
Steeped with the nuances of your business, your finance department will drastically benefit from a self-service platform. By empowering these teams with automated, transparent access to your raw data, you can ensure your organization sees the greatest return from a shift toward a data-driven culture.
Close the books faster with an effective data quality program
Though frequently siloed away from your organization’s day-to-day analytics efforts, finance and accounting are responsible for generating crucial insights from your data.
Finance teams provide an important conduit of information to boards of directors and senior management. Their work exists at the confluence of multiple datasets with reports involving internal marketing and product development expenditures as well as outside sources like credit card data. But other departments typically don’t access these reports. As a result, as modernization efforts begin at your company, finance and accounting often toil in obscurity.
But when it comes time to close the books, these teams are in the hot seat. Unable to begin their work until the start of a new month, these teams need weeks to download and reconcile data exports to form a picture of your organization’s financial health. Then, once this long process is complete, it begins again with the start of a new month.
While waiting for books to close, management doesn’t know how well the business has performed. Factor in the time-consuming effort in compiling annual reports, and the weeks lost at the executive level to reallocate resources and respond to potential issues further add up.
With the ability to pull this data into a centralized source, your finance team will save so much of this wasted time. Reconciliations of figures like credit card receipts in orders can be automated to track revenue, expenditures, and losses. Every month, your finance team will deliver business insights so much faster. The faster the books are closed, the sooner management teams are able respond to what your business needs.
Modernizing your accounting data streamlines business operations
When companies fail to include their finance department in their modernization efforts, the reports generated by other departments also suffer. After all, accuracy is the number one priority in accounting. If there’s a discrepancy in totals generated by other departments, executive leadership will defer to the finance team even if their sources are less reliable. This not only undercuts the effectiveness of your data program, it threatens its long-term success.
When companies implement data quality programs but leave out the finance department, accounting teams are unable to access the same data as the rest of the business. In these situations, it’s very difficult to match operational data with financial data.
The finance team also uses specific technical considerations to generate totals that are distinct from department reports. Because their calculations are used in year-end reporting, they typically have the last word when inconsistencies arise. This tendency by upper management to favor the finance team’s conclusions can generate animosity between departments. Worse yet, this mistrust results in the modernized portion of your data losing credibility across the enterprise.
Data with standardized definitions — data that’s centralized, trustworthy, and accessible across your organization — allows these issues to be avoided. Ensuring your finance team’s needs are met and that they are generating totals consistent with what’s being reported elsewhere is critical to an effective analytics initiative.
Updating accounting operations requires a distinct operating model
Implementing a data modernization effort with your finance department requires special handling. They use complex datasets and require different tools than other parts of your organization. But a close partnership with an analytics team leads to an effective transformation of their processes.
You have to understand all the nuances of their work to ensure their definitions are automated and reconciled with the operational side of your business. Additional training is also necessary to ensure new tools like a self-service dashboard satisfies their specific needs. In addition, understanding the compliance and regulatory demands that are crucial to their reporting requires extra focus. In data-driven technology companies, this poses a considerable challenge.
However, if these conditions are compiled and resolved properly, your finance teams will trust the conclusions from your business intelligence software. Given their standards for accuracy, the rest of your organization will inevitably follow suit.
With proper data management, finance teams work faster and with greater visibility
A comprehensive data quality program requires time, technology, and a cultural shift for your organization. But many companies overlook the data at the backbone of their business. By not including your accounting and finance teams in modernization efforts, you’re missing out on all the true benefits such changes deliver.
Providing accounting teams with standardized access to raw data allows a critical part of your business to operate more efficiently. This streamlined effort doesn’t just help your business operate faster at the close of every month and fiscal year. It allows your leadership teams to quickly recognize and act upon the issues at the heart of your operations.
Finance and accounting teams operate with a need for accuracy down to the penny. Once these departments can quickly generate accurate conclusions from data, each part of your organization stands to gain.