Live from The Exchange Community 2016: San Diego Day 1
The fifth annual Wdesk user conference is underway in San Diego, and this week we've got a special guest contributor taking over the blog, giving us live updates from the conference. Please welcome Matt Kelly, Editor and CEO of Radical Compliance, to workiva.com.
Live from The Exchange Community 2016: San Diego Day 1
Workiva kicked off its 2016 user conference Wednesday in San Diego hitting on themes of technology power and flexibility—which accounting, audit, and compliance executives will certainly need as they confront the modern regulatory and reporting climate.
Workiva announced a flurry of software enhancements to Wdesk, its flagship product, including an expanded data platform that brings more powerful spreadsheet and formula capabilities, enabling better control of company data. Users will be able to build more complex cloud spreadsheets, working with others in real time, using an advanced formula editor. That will lead to stronger data linking, better audit trails, and easier collaboration.
Wdesk users in the audience were happy to hear about the software enhancements. (Word that Wdesk will now be able to sync cross-sheet formulas was a particular applause line.) Still, the bigger picture is how Workiva is trying to fit Wdesk into the larger technology and regulatory landscape.
Breaking up ERP
The shift that’s happening is this: modern advances in IT, such as cloud computing and mobile devices, are making collaboration among finance, compliance, and risk employees much easier to do—if your business software can keep pace. That can be a tall order for large on-premise software vendors with a long history of slowly delivering mega-suites of software, given today’s rapidly changing regulatory world.
John Van Decker, Research Vice President at Gartner and an opening speaker Wednesday morning, called this the “post-modern ERP world.” Big vendors can’t provide mega-suites of software fast enough to keep pace with cloud specialists, he said, who constantly change and upgrade.
What comes next, he said, are “loosely coupled ERP solutions” that work in the cloud. Corporate controllers and chief accounting officers will still drift toward applications for financial corporate performance management (FCPM), while operations or risk executives will want IT for strategic corporate performance management (SCPM). And kudos to Van Decker for bringing two more acronyms into the financial compliance vocabulary.
Van Decker’s analysis is spot-on. More and more companies are getting swept into the “highly regulated” category, where your reporting obligations are extensive and change often. And even if your specific business has dodged that world so far, you still face a high-disclosure environment, where any number of parties (external auditors, investors, senior executives, or an inquisitive public) might want to see precise data quickly about the company’s performance. Clunky software applications with poor visibility into where the data comes from are not what you want in that world.
Wdesk users speak
Workiva also had a panel of customers talk Wednesday morning about how they use Wdesk to confront all these compliance demands.
One common theme was enhanced productivity. May Hng, for example, talked about her role as head of internal audit for Bel Fuse, a maker of electrical components that went through two mergers in 2014 that doubled the company’s size. Needless to say, Hng’s internal audit team did not double in size along with those moves—so she used Wdesk to simplify her SOX compliance audit work, rather than ask the CFO for a $500,000 budget increase.
Anita Chakravarthy, Senior Vice President at Wintrust Financial Corp., uses Wdesk to help Wintrust (a bank holding company based in Chicago) manage its Dodd-Frank stress tests. Stress tests are, well, stressful for financial companies, where departments across the entire enterprise need to submit data to show the Federal Reserve how the bank might fare under various economic scenarios.
In Chakravarthy’s case, the challenge was more about data management, as the data went across many different eyes in the bank before the final report went to the Fed. “We provide all the scenario results, and you tell how you got from one point to another,” she said. “It all has to come together… That’s very difficult if you don’t have a place to go and review what [business units] have given you.”
That ability to show your homework in a spreadsheet is only going to get more critical in the future. In corporate accounting, for example, the Financial Accounting Standards Board has pushed through a major overhaul of revenue recognition that will drive companies to use more judgment about when exactly they can record a transaction on the books. In anti-money laundering, banking regulators have been clear that financial firms cannot “de-risk” away from whole classes of customers, such as legally operating marijuana businesses. In both cases, companies will need to be able to demonstrate why they made the decisions they did.
Version control, tracked changes, and the like—that’s the documentation of your judgment and data accuracy over time, really. The need for it will only grow in the future, and the need for flexible IT to deliver it quickly is already here.
About the Author
Matt Kelly is an independent compliance consultant who studies corporate compliance, governance, and risk management issues. He maintains a blog, RadicalCompliance.com, where he shares his thoughts on business issues and speaks on compliance, governance, and risk topics frequently. Kelly was named as "Rising Star of Corporate Governance" by the Millstein Center for Corporate Governance in the inaugural class of 2008 and named to Ethisphere’s "Most Influential in Business Ethics" list in 2011 (no. 91) and 2013 (no. 77). Kelly previously was editor of Compliance Week, a newsletter on corporate compliance, from 2006 through 2015. He lives in Boston, Mass., and can be reached at mkelly@RadicalCompliance.com or on Twitter at @compliancememe.