THANK YOU FOR SUBSCRIBING
Be first to read the latest tech news, Industry Leader's Insights, and CIO interviews of medium and large enterprises exclusively from CFO Tech Outlook
THANK YOU FOR SUBSCRIBING
By
CFO Tech Outlook | Monday, December 16, 2024
Stay ahead of the industry with exclusive feature stories on the top companies, expert insights and the latest news delivered straight to your inbox. Subscribe today.
Financial planning and analysis processes are frequently fragmented and need more input from operational areas.
Fremont, CA: As more data becomes accessible and businesses attempt to maximize its value via analysis, financial planning and analysis (FP&A) is becoming more and more crucial. However, there are still difficulties to be solved. Decision-makers need more confidence in the underlying data that underpins their analytical applications is one of the key problems. Why, then, is financial forecasting so difficult? Due to antiquated planning technology and procedures, financial planning and analysis processes are frequently fragmented and need more input from operational areas. More importantly, spreadsheets are the most popular tool for non-financial planning. Operational planning is still done using spreadsheets, even if the Finance team typically utilizes planning software. Despite major technical developments, spreadsheets have mostly stayed the same. Let’s see some of the major FP&A problems faced by CFOs.
Check Out This : Insurance Business Review
• Lack of Business Insights
The low quality of data that is currently accessible and the incapacity of most CFOs to translate their company data into crucial insights are two typical issues. Spreadsheets frequently get shared with a wide range of individuals and groups; over time, alternative versions may develop that diverge from the original, making modeling challenging and unreliable. Without a single source of truth, gathering and assembling all the required data is a laborious, slow, and prone to mistake process. Spreadsheets cannot accommodate macros and computations, which may leave any expanding business without the solid models and predictions needed to create accurate budgets and forecasts. Senior management must delve more deeply into company data and obtain insights to help make decisions.
• Inaccurate Budgeting and Forecasting
The collection and analysis of data, the running of scenarios, the analysis of techniques, and the prospective consequences may all be done with the aid of cloud-based financial forecasting systems. There needs to be more than the appropriate solution alone, however, for precise financial forecasting. The projections are frequently wrong because the financial systems are unreliable and must be changed. Methods and procedures often need more consistency, which makes it challenging to make wise decisions.
• Lack of Real-Time Information
Business executives want up-to-date data, and finance departments get always pressured to provide valuable insights to aid decision-making. A need for precise, current data constrains the degree of depth that any financial planning system offers. This information may help develop the company's correct goals and plan. Real-time reporting made possible by self-service analytics capabilities aids in identifying underperforming income streams, enhancing operational effectiveness, evaluating the company's success, and creating a workable growth strategy. Along the way, users may modify their plans in response to any modifications in real-time information.
I agree We use cookies on this website to enhance your user experience. By clicking any link on this page you are giving your consent for us to set cookies. More info