5 things you need for better financial reporting (and how to get them)
How much time does your finance team spend collecting, sifting, and analyzing data?
If you said “too much time,” you’re right. According to a Deloitte report, finance teams spend 48% of their time creating and updating reports. And when they’re operating at such a tactical level, it can be hard for them to see the forest for the trees.
Without a modern approach to financial reporting, finance teams are so bogged down in the details that they simply don’t have the time to uncover insights in the data 一 insights that could be vital to your business.
So how do you help them? In this piece, we’ll highlight five things you need to strengthen your financial reporting and be strategic in the data decade and how you can get them.
1. Accountability and dynamic reports
Finance teams have a lot riding on their shoulders. They’re responsible for reporting on business performance, something leadership teams and customers care deeply about. But business stakeholders don’t just want to be told what they want to hear. They want to know what’s really going on at the company.
What’s happening in sales, product, marketing, customer success and how does their progress (or lack thereof) contribute to the whole? How could these groups optimize to get the most return? Extended Planning and Analysis (xP&A), or the concept of breaking down siloes and reporting across the organization, is what the future holds. But the finance department needs to change today.
Finance teams need to be able to detect and help mitigate risk in all areas of the business. But in this day and age, there is so much noise that it’s hard to know whether inconsistencies are simply a result of bad data or if they truly represent an underlying issue that the company needs to fix. Worse, many of the reports finance teams run are in spreadsheets, which are prone to error and only show what's happening at a singlepoint in time.
To hold themselves and their business partners accountable, finance teams need accurate, useful financial reporting 一 they need dynamic reports. Platforms like Phocas enable finance teams’ accountability by monitoring performance, identifying trends, and determining profitability at any given moment.
2. Transparency in business intelligence
What was one of the most important things you learned back in high school math? Showing your work. It’s no different for finance teams, they just have to show their work on a much broader, higher stakes scale.
Proving that they collected the right data, used the right transformations, and performed the right analysis is finance table stakes for a company of any size. But because data is constantly growing and changing, even the basics are becoming difficult to substantiate, and will only become more difficult over time. To provide the transparency that internal and external stakeholders desire, companies need to bring their data under control.
Modern cloud-based solutions like Phocas can integrate directly with ERPs and other accounting systems to make it abundantly clear where financial information is coming from. And the financial dashboards, budgeting tools, and forecast modeling that result show exactly what that data means for the company.
3. Trustworthy KPIs
It’s one thing to have a lot of data, but it’s another to actually trust those numbers. Unfortunately, most businesses, even (and perhaps especially) small ones, house their data in disparate databases, a recipe for fragmented, duplicative, and inaccurate analysis. When companies operate in this fashion, it’s no wonder stakeholders have trouble trusting their insights.
What organizations really need is a purpose-built financial planning and reporting solution to funnel data residing in various systems into one place where it is deduped, transformed, and otherwise made ready for analysis. With a standardized, trustworthy source of truth, everyone can work under the same assumptions and draw more accurate conclusions. A single source of truth also makes your KPIs a truer reflection of where your business stands at all times.
4. Self-service reporting
Your finance team is probably spending their days gathering all the information they need to create and run reports, leaving them very little time to focus on strategy. In fact, McKinsey finds that finance leaders only spend 19% more time on value-add activities than other organizations, but that’s more than anyone else in their department. So how can you enable FP&A teams to actually focus on the planning and analysis?
The answer lies in self-service reporting. Many companies rely on IT to run reports, but that can take a long time and the reports are stagnant. But what if anyone could pull their own reports? They’d get the data they need without having to wait. And everyone would have more time to surface important insights and help the company be more strategic. A self-service financial reporting software evangelizes data analysis throughout an organization, making the whole company more data-driven, productive, and effective.
5. Data exploration with self-service reporting
In order for finance teams to get the most out of your data, they need to break out of siloed frameworks and change their perspectives. That means they need to step away from the same models they've been leveraging over and over.
Thinking outside the box and collaborating with other teams can reveal nuggets of wisdom that otherwise would’ve been overlooked. Financial analysis platforms can help your teams slice and dice your data and visualize it in different ways, opening the door to more creative exploration and interpretation. And when those insights are readily available, finance can share them with other teams to create and sustain a competitive edge.
Shine a light on your finances with Phocas
Phocas, an intuitive business intelligence software, can help you enforce accountability, provide transparency, and instill trust in your financial reporting, allowing your finance teams to solve the mysteries in your business and gain competitive-edge-worthy insights in the process. Even better, you can give everyone the independence of self-service reporting. Free your teams to create dynamic reports they need and give them the confidence to analyze the data themselves and uncover actionable, real-time insights.
Learn more by requesting a Phocas demo today, or try Phocas for free now:
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