What is the number one most important thing in the CFO digital toolbox to enable error-free annual reports? The easy answer is; you need to have transparent data and complete control over your data flow to prevent errors. Having control over your data flow means knowing exactly where your data comes from and enabling a streamlined reporting process throughout your group. Knowing the origin will eliminate hours of coordinating with subsidiaries, error-checking, and endless editing. Even better, it will also ensure that your financial reports build on high-quality data and that you, as a CFO, can do what you do best: Be an advisor to management and the board.
So, how to build a dataflow that ensures you can deliver in-depth financial statements based on an accurate data set? We will go through 3 simple points to help you develop your smooth and transparent dataflow—the essential part of the CFO Digital Toolbox.
CFO Digital Toolbox: Building transparent dataflow before the annual account
#1 Workflow automation
First up in the CFO digital toolbox is workflow automation. If you have not yet automated any processes in your workflow, now is the time to consider doing so. An excellent place to start is in ‘the gathering of data’ since if anything goes wrong here, it will affect the entire output.
The risk of not meeting the reporting standards is much bigger when keeping the reporting process manual. If you are gathering your data manually, you must ensure that the methods of doing so are streamlined across your group to meet reporting standards. One simple miscommunication and the data you get might not live up to the standards needed for your reporting. So, why use automation to collect data? A straightforward answer can be that your time is worth more when analyzing and working with the data than being an error detector.
By automating specific reporting tasks, you ensure that you get the required data instantly instead of wasting time checking that data is accurate and collected correctly. Automating these reoccurring and essential tasks, essential to the reporting but not do not require your specialist skills to be solved, will free up time for analyzing and evaluating data. Thereby, you can influence the decision-making and really impact your business.
Automating tasks enables you to quickly get some things done (like checking if all your VAT codes are valid). You will remove redundant, repetitive tasks and free up time to dive into data and see what actions to take to futureproof your group – something directors will thank you for in the end.
#2 Data warehouse
To build a dataflow that runs smoothly, you also need to look at where you store your data. Is it in a static spreadsheet, or is it in software that can quickly support you and deliver what you need when making financial reports?
If you are currently storing all financial data in Excel, you need to consider if this continues to be the right fit for your group. If you expect growth, it might be a good idea to look for alternatives to spreadsheet storage since the more data you store, the easier it is for your spreadsheet to break and lose the overview.
By storing your financial data in software built for the task of holding and handling a significant amount of data, your team gains several benefits:
- It gives you more valid data, which can be accessed and processed quickly.
- Fast and accurate financial data increases credibility and trust in the data within the group and among shareholders.
- You can quickly locate and pull specific financial figures from your database whenever you, management, or stakeholders need it.
An online data warehouse built to handle large data sets enables a more efficient workflow and transparency in your CFO digital toolbox. With all your data gathered and managed from one place, you can trace data back to the source, process it, and send it without losing the overview. An online data warehouse is valuable when building transparent and smooth data flow.
#3 Data Integration
Communication is the key to outstanding financial reporting. That also goes for your digital tools; if your software doesn’t talk together, it will be hard to create the transparent and smooth data flow needed for futureproofing your reporting. Integrations ensure that data can smoothly move data back and forth between the digital tools you are using.
This can prove to be an advantage, especially if you are expecting growth or new acquisitions in the near future, as your data will increase. The need for several different software increases when operating with an increasing amount of data. Agile data integration becomes an interesting factor when using multiple digital tools. If your systems do not integrate, the data load can increase to a level that can be hard to handle manually. Eventually, it can result in you and your team drowning in data and communication overload.
A smooth and transparent data flow can be your lifeline when the data flood occurs. And here is agile data integration, a key element. To avoid losing the overview, let integrations do the manual work of transporting data from one system to another, so you can concentrate on looking at the bigger picture of your business that data provides.
Implementing data integration does not have to be an expensive or difficult project to take on. Start with the systems you are currently using and working with daily. Look in their app store to see what other software they connect with to get an overview. For instance, look at how to get data from your ERP system to your consolidation or reporting tool. Take small steps and when you have something worthy of showing management, then present it so they can see all the benefits of agile data integration to create a smooth and transparent dataflow.
The success of the CFO digital toolbox depends on your dataflow
So, the conclusion is that to gain the absolute maximum of your digital tools, you must consider implementing the 3 points mentioned above in your reporting to ensure a smooth and transparent dataflow. Write these 3 points down, take a meeting and go through where you see some gaps in your current workflow and elaborate on how each subject can contribute to filling these gaps. That is the first step towards building up a digital toolbox. Once that is in place, you will discover a considerable difference in your output, and your management and board will thank you for your precise insights.
If you are interested in other digital tools to upgrade your workflow and reporting, then look at how RPA for instance can help you and your team. Or watch our webinar.