Seizing the initiative and restructuring your enterprise’s financial processes isn’t easy – but a good CFO or controller should always be striving to continually improve such processes. Optimising your financial processes will give you greater agility when it comes to drawing up your management reports, while also ensuring the integrity and reliability of your financial information. And that’s exactly where FPM software comes in – it helps CFOs and controllers to make their financial processes more reliable and efficient by improving data quality, simplifying process management and automating the creation of financial reports, thus making your decisions easier. What’s more, an FPM solution can also enable you to achieve more work with fewer personnel. In turn, this will give many of your accountants the chance to expand their scope of responsibility to include management controlling tasks, which can prove a great source of added value to your organisation. It also means that the future growth of your enterprise will no longer lead to a heavier workload, as the FPM solution will bear the brunt of the increased financial data processing work.
This article is the fourth part in our Why FPM? blog series. Have you read our other blog posts on the benefits of integrating your financial processes? If not, you can catch up here:
How FPM software can help to make our financial processes more reliable
FPM software offers a wide range of benefits, and helps to make our processes more reliable. Here are just some of the ways in which it does this:
1. Less data tied up in spreadsheet calculations – or none at all
Using spreadsheet calculations for your budgeting, consolidation or reporting is a process that is susceptible to errors, and it also makes it harder to update your data and for different users to access the information in the spreadsheets. FPM software allows you to do away with Excel completely, as the system will provide you with all the information you need.
2. Automate your consolidation processes
Generating your consolidated financial statements automatically – in accordance with international accounting standards – increases the reliability of your financial processes and thus saves on both time and resources that can be better spent on other tasks.
3. Integrate your financial processes
Good process integration allows multiple users to work with the same accounting and financial figures in real-time.
4. Make sure all your information is where it belongs
FPM software enables you to store all your financial data in the right place, making all your accounting and financial information easier to use.
5. Incorporate all your financial statements in your consolidation
Consolidating your profit and loss statement, balance sheet and cash flow statement for financial planning purposes is the key to a reliable financial process. With an FPM solution, you can link these three statements together so they can be updated automatically based on your individual transactions.
6. Reliable financial planning in real-time
At many companies, financial and scenario planning are still carried out using Excel. Since this doesn’t allow them to be incorporated into the annual financial statements in real-time, it delays reports and makes them susceptible to errors. By integrating your financial and scenario planning and your budgeting using FPM software, you can improve the accuracy, transparency and speed of your processes, and thus optimise your company’s resources.
7. Use software that provides traceability and transparency
A fully integrated system makes it easier to access your data right down to the individual transaction level, so you can view and extract invoices in real-time whenever you need.
8. Optimize your dashboard with important KPIs
Automatic dashboard generation is another key factor in the reliability of financial processes. With LucaNet’s FPM solution, the dashboard can be accessed immediately at the push of a button.
9. Collect and validate your data locally
While it is true that data collection is more efficient when you have a number of different ERP systems connected to a single FPM program, for harmonisation purposes it is better to use an FPM system that allows local data validation. This prevents errors and gives your local accountants immediate feedback on the quality of the data they have collected.
10. Utilise business intelligence (BI)
Business intelligence tools make it easier to turn information into insight so that you can make better decisions. FPM solutions guarantee the accuracy and integrity of the financial data you use as the basis for your financial analysis and your use of BI tools.
What risks are organisations exposing themselves to if they fail to make their financial processes more reliable?
Putting off decisions that would help to make your financial processes more reliable because you’re scared of the risks can actually lead to a much greater risk for your organisation – not just in the medium term, but in the short term as well. There are a number of reasons for this:
- Loss of profitability. Time is money, and putting off such decisions will lead to ever-increasing costs in the long run.
- Outdated financial processes and loss of efficiency. The financial processes that were established years ago are no longer equipped to deal with the growing volume of data and the technological innovations of today’s world.
- Too many personnel are required to complete routine accounting tasks. And as a company grows, so too do these routine tasks, leaving you needing more and more personnel just to keep your outmoded and inefficient processes running.
- Reports that are key to your decision-making processes take longer to provide. Yet in order to make the optimum decisions at the right times, you need information that is not only reliable, but also provided promptly. Without this, losses are inevitable. Your financial processes can no longer keep up with the growth of your enterprise. When an enterprise grows, its existing financial processes quickly become no longer fit for purpose. New processes and tools are required in order to keep pace with the expansion process.
- You lose your competitive edge. A company that has already realised it needs modern FPM solutions to survive in the digital age will have a clear edge over competitors who are putting off implementing a new system.
LucaNet’s FPM solution uses Extract-Transform-Load technology (ETL) to extract, transform, load and aggregate financial data, thus making it easier to read locally. It can also extract data from a variety of ERP systems and compile them to create a single source. This type of data integration is in keeping with the requirements of modern consolidation and reporting. It provides users with a full, real-time overview of their most important KPIs – and thus of the company itself.
A disconnected finance management process causes plenty of frustrations for finance teams. Here are our top 4 reasons why the integration of financial processes and systems should be a top priority.
Reducing the time for the financial close by 50 % - Easily done by leveraging on an FPM solution! Read in this blog post how you can easily speed up your financial processes.