Timely, accurate financial management reporting helps business leaders make informed decisions based on their organization’s financial health. Here are four steps you can take to improve your reporting process and increase agility.
Financial management reporting is the process for communicating financial information about your company’s performance. It helps stakeholders—including management, lines of business, department heads, investors, and regulatory agencies—make informed decisions based on their organization’s financial health.
When done well, financial reports can provide insights into the past, present, and future, helping the entire company manage volatility, navigate organizational complexity, meet compliance requirements, and drive the direction of operations. Given today’s speed of business change, financial reports have never been more necessary to run the company or more in demand by executive management.
Yet the challenge for most financial planning and analysis (FP&A) teams is creating timely, accurate, and efficient reports that help companies course-correct quickly. Here are four steps you can take to improve your reporting process and increase agility.
It might sound scary, but without a central data system you’ll waste countless hours dealing with multiple source systems to pull information. And it’s only going to get worse. As businesses introduce more and more systems to track every last bit of data, you’re going to simply run out of time if you keep trying to pull all that information separately and manually.
Not everyone speaks accountant. Your reports aren’t always going to be read by finance professionals. You must understand the needs of your audience and create reports appropriately. That way, the reporting process becomes a strategic conversation instead of just a wall of numbers. For example, operational leaders might want detailed metrics on their unit, while executives may require a higher-level summary of the entire business. The more relevant information you can provide, the more valuable your reports will be.
Ask any toddler at bedtime: Stories are always better with pictures. It’s no different in reporting. Data visualization, such as charts and graphs, is crucial to good analysis. When you present your raw numbers visually, your audience can see the story the numbers are telling while easily spotting potential problems or outliers. Not only is a picture worth a thousand words, but it can help you understand the worth of a thousand numbers.
If you had a nickel for every time you had to pull a financial report for another department, finance would be the most well-funded department in the company. Sure, you’re happy to help, but pulling reports for everyone else means less time to work on your own valuable strategic activities. By enabling self-service reporting and dashboards, the finance department can take its time back while empowering other departments to get the data they need in seconds instead of waiting for weeks.
When done well, financial reports can provide insights into the past, present, and future, helping the entire company manage volatility, navigate organizational complexity, meet compliance requirements, and drive the direction of operations.
By taking these steps, FP&A can make a big impact and solidify its role as a strategic business partner. But outdated technology can bog down your finance team in low-value tasks, preventing it from adding true value to the business. In contrast, modern cloud finance solutions, such as those from Workday Adaptive Planning, support active planning and reporting, empowering finance teams to better manage their business. Use Workday Adaptive Planning to:
Improve accuracy. Provide a single source of truth, combining financial reports, planning, and operational metrics in a modern cloud finance software solution. This makes it easy for everyone in the organization to access and update reports—from granular to consolidated—and to drill down into the information they need, when they need it. Instead of targeting individual errors, think holistically and adopt straightforward solutions that can prevent reporting errors before they even start.
Eliminate manual data gathering. Make all financial data available in the cloud, eliminating tedious, manual aggregation. This not only frees the finance team from hunting for data so it can focus on strategic analysis and direction, but ensures that reports are always up to date. In centralizing data and automating non-value-added tasks, the office of finance can elevate the reporting function, providing top management with the analysis needed to enable better decision-making.
Increase collaboration. Combine metrics and reporting with relevant commentary. This makes it easy to compare actual and expected performance, adding comments to explain variances. Self-service reporting also helps further engage business managers and deliver visibility into the data they want and need. Managers don’t have to make a request to build a new report; they can simply create their own. When finance is an engaged partner, everyone wins.
Interpret the data. Create and easily share customized reports and dashboards across your organization to provide an up-to-date, visually compelling story. There’s a clear need for increased commentary and narrative in reporting. Stakeholders don’t just want accurate statements—they want to understand the story those numbers tell about the business. And they’re more empowered to spot trends and stories when data is presented visually.
Most businesses today know that their financial management reporting is not as good as it should be. Yet many are slow to take action to correct the problem. The reasons are profuse, chief among them the perception that it’s too difficult and there’s too little time to implement improvements.
But when you put better reporting on the back burner, you put your business at risk. Instead of looking into the rear-view mirror—a static approach to planning that reports on what happened in the past—it’s far more effective for finance teams to look out the windshield and anticipate what’s ahead. This is doubly true if your competitor can spot a new market opportunity while you’re still running around trying to get accurate historical info.
Modern planning not only changes how you do your job; it has the potential to recast how finance is viewed throughout the organization, strengthening relationships with business partners and shifting FP&A teams into a leadership and guidance role. In short, finance becomes a value-adding intelligence provider that the board and business units can depend on to support more informed decisions.
One estimate finds that by 2025, about 70% of the workforce will work remotely at least one business week each month—meaning that decades-old planning processes need rethinking.
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