CFOs and accountants are continually striving to gain more control over the month-end close, seeking a balance between speed and accuracy.
Although great strides have been made with automation, control, statutory, and management reporting, there are still considerable gaps in the process that traditional enterprise resource planning (ERP) and corporate performance management (CPM) systems fail to fill.
In April 2018, the National Trades Union Congress hosted a roundtable with the Singapore Accountancy Commission (SAC). Seventy-six percent of the finance leaders attending the event indicated that technology was the critical driver of change for jobs and skills in the accountancy industry. They said that although the advent of new technologies such as robotic process automation (RPA) has transformed business models, accounting methods are still relatively traditional and are not keeping pace with the new ways of conducting business.
If there is one phrase that summarises the disappointment with the current approach towards the accounting process, it’s the lack of visibility of data. Yet this is probably the least expensive and easiest problem to fix. Why?
Cloud-based platforms act as the connective tissue between all of the stakeholders in the process, joining them to each other and to the process itself. With this enhanced visibility, month-end close tasks, issues, and problems can be captured in a single computing environment without having to resort to emails, walking the floors, and impromptu meetings.
In an instant, 'it's possible to improve productivity and enhance the quality of information and control. As a pleasing by-product of increased levels of collaboration, users feel more fulfilled, so the entire user experience is improved.
Advancing Finance Transformation Initiatives
Moving to the cloud is transformational for accounting and finance teams. It also delivers the visibility CFOs need for effective daily decision-making.
According to EY, 74% of CFOs saw an understanding of digital, smart technologies and analytics as a required skill. Meanwhile, McKinsey reported that only 30% said they are prepared for the digitization of business in the next five years.
Last year, in her keynote speech at the ACCA Singapore Annual Conference, Minister Indranee Rajah in the Prime Minister's Office highlighted that new technologies are reshaping Singapore's economy. Those technologies are a natural next step in the evolution of the country's industrial clusters and are to be harnessed and not feared. She also added that new technologies are already transforming accountancy.
From many perspectives, accounting is lagging behind other professions in developing and using real-time and forward-looking information to drive organizations’ performance. As the traditional roles of accountants evolve, firms in Singapore are following the global trend in expecting accountants of all levels to be responsible for improving the finance team’s reputation within the business.
The coming year will see this trend continue. This means accountants are expected to put their focus on providing business advisory services. By being willing to embrace cloud accounting, all the time-consuming tasks that used to eat up hours of the day will be gone. Besides, by implementing a cloud-based finance automation platform, organizations gain a digital edge that will accelerate the month-end close and ensure accurate financial statements. However, this must begin with knowing what to look for to ensure the chosen solution can advance the organization's finance transformation initiatives.
Identifying the Right Cloud Solution
Solutions that are built specifically for the cloud offer a cohesive web-based UX and are customizable by business users. Further, they often have robust application programming interfaces (APIs) that enable easy integration with other cloud and on-premise apps in the finance technology landscape, like legacy ERPs or third-party supplier, invoicing, and banking and credit card systems.
With cybersecurity and continuity being top of mind when it comes to cloud services, CFOs should look for ISO 27001 certification as well as SOC 1/2/3 compliance. This ensures the provider is dedicating the utmost security and highest level of controls to managing the application and securing the data.
Finance is following a hybrid model in how cloud apps are deployed. Simply put, a hybrid approach blends new cloud technology with existing legacy on-premise apps. It enables the addition of new cloud apps, such as reconciliations automation or improved financial reporting, without having to rip and replace old infrastructure by integrating new with old.
For success, Singapore businesses should look for cloud solutions that deliver rich, pre-built connectivity to ERPs, strong SOAP and REST APIs, and the ability to reach across firewalls to connect to on-premise systems.
It's Time to Take the Lead
Now is the time for finance leaders to take the lead on technology decisions, and ensure their organizations are equipped to thrive in today's digital world. The role of the CFO has transformed tremendously in its demands to deal with new and increasingly complex challenges. As we move forward into the latest finance landscape, digital savviness is vital.
The need is to incorporate applications that are designed to fill in the process gaps, including reconciliations, transaction matching, and task management. The end result provides a potent solution for CFOs and business leaders seeking a step-change in capability rather than the incremental improvements that have characterized improvement initiatives in the past.
Terry Smagh, Senior Vice President, Asia Pacific & Japan, BlackLine contributed to this article.
The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends.