CFOs Not Ready for an Era of Self-service Reporting
By Tony Bethell, VP Strategic Alliances, ClusterSeven
The latest research by the FSN Modern Finance Forum entitled “The Future of Financial Reporting Survey 2017” has brought to light a key issue – financial reporting is putting great strain on finance teams and so to alleviate the burden, CFOs are turning to self-service reporting. CFOs rank it as their number two technology priority, after automated document production with version control and electronic signatures in number one position.
It is understandable – in addition to internal business reporting needs, ever-growing regulatory and compliance demands are taking their toll on finance departments, against a backdrop of cost cutting and headcount freeze.
However, one cannot but help question if self-service reporting is indeed the right option at this point in time, given the numerous issues that finance departments already face with their regular reporting practices. Spreadsheets, which are widely used in finance departments for complex calculations, data manipulation and reporting are out of control. In many organisations, finance departments don’t even have processes for spreadsheet control and management, making data accuracy and integrity a major problem. This has direct implications for financial reporting.
The above-mentioned survey finds that 46% of CFOs worry about an unexpected spreadsheet error being identified; and 40% of CFOs are unable to agree that their data is always trustworthy. It’s then no surprise that 55% of CFO worry that controls are not operating as they should. In this scenario, a self-service approach to financial reporting could prove disastrous.
Furthermore, finance departments presently lack reporting agility. 66% of CFOs are unable to make changes to reporting systems without depending on the IT function. Why? Potentially because organisations’ enterprise systems are proving inadequate to meet the changing requirements of finance departments –they are restrictive making adding new operational processes difficult without IT involvement. Spreadsheets, on the other hand, are flexible and offer good financial modelling capabilities, which is perhaps why 69% of CFOs rely on spreadsheets to plaster over gaps in their reporting process.
Unless CFOS get their own house in order, their ability to deliver self-service reporting will remain a far-cry. 75% of CFOs are yet to make the move to real-time reporting in the Boardroom. Fundamental to self-service reporting and real-time reporting is data accuracy. This can only come on the back of complete visibility of the spreadsheet universe and transparency of data lineages across the file landscape. Automation of spreadsheet management based on best practice processes can deliver on this and so it must be a consideration for CFO’s. It will enable them to manage every single spreadsheet across its lifecycle – from creation through to inclusion in the enterprise system and decommissioning – as a matter of routine, and go a long way in making self-service financial reporting a reality.
An infographic of the findings of this topic is also available