How Connected Reporting is Revolutionizing Financial Services by Eliminating Risk
First published in Finance Derivative, p.50-51, By Dermot Murray, General Manager of EMEA, Workiva.
Technological advancement has played a huge role in improving how we report across financial services. With traditional reporting, we were forced to rely on paper-based, manual processes that drained time, resource, and money, but with technology, companies are now more efficiently streamlining processes to handle large amounts of data with little to no manual effort.
Despite the promise of digitisation, many organisations continue to be limited by old, outdated processes and systems. Often times, this is due to lack of capacity within IT teams to adopt and manage new software, but it can also be attributed to preference for familiarity. Many favour what they know over what may – or may not, depending on your outlook – improve business operations.
What has become clear is that with some organisations using legacy systems and others going digital, financial reporting has become an inconstant, fragmented hodgepodge ultimately leading to an increase in errors, fines, and potential reputational damage. With the risk so high and the margin for error so low, how companies report has now become a top concern across many large organisations. Shred-It recently found that 53% of C-suite executives and 28% of small business owners found human error or accidental loss by an outside party to be the leading causes of data breaches.
Correcting a single error across spreadsheets, presentations, and reports is a complex and labour intensive process. To do this and ensure 100% accuracy, organisations now waste significant resources in terms of costs and employee support, and even then there is no guarantee that the report will be flawless. Rather, the inconsistencies and risks associated with manual processes are further driving the need for financial digital transformation, globally.
We’ve accepted interconnectivity into our everyday lives, whether it’s connected cars, homes, or devices, and yet despite this, many organisations still refuse to acknowledge the opportunities that streamlining reporting processes hold. Through using automation to link values (quantitative or qualitative) across multiple reports, organisations will minimise misreporting risks, save money, and improve consistency for future use.
In addition to streamlining reporting, an overhaul of a legacy system with an end-to-end solution can also streamline the process of document consolidation, production, review, and approval. This makes the process of financial reporting painless and efficient. More broadly, automation can improve upon:
Contextualising Data - According to EY, roughly 75% of companies rely on six or more types of reporting systems (like ERP, CRM, and HCM systems). However, as soon as data within these systems is exported and moved to a non-compatible platform, it loses all context and opens itself up to inconsistencies. With connected reporting, people, processes, and data are unified to deliver accurate, contextualised reports for internal and external use.
Improving Collaboration – Because outdated processes come up short, companies end up relying on cumbersome manual processes, large teams, third-party consultants, and a variety of single-point solutions. And with so many points in the process, it’s often difficult to know which the most recent version of a given document is. This is particularly the case for companies working across time zones – here’s where automation can help. Automation ensures accuracy across document versions regardless of time, location or language, and can improve collaboration for fast, reliable reporting.
Referencing Reports – An ongoing and commonplace challenge across financial reporting is the growth and complexity of companies. As companies grow, there an increasing number of employees and data points spread across the world. This data is then spread across hundreds of different sources and stored in incompatible formats, which makes managing processes exponentially harder. However, by creating a single source of truth – a live working document from which employees can feed into in tandem – businesses can trust that all documents, presentations, and reports are up-to-date, accurate, and consistent, reducing the associated risks.
Relying on IT - Until recently, integrating a new financial reporting or risk management system into a business has meant the IT team has had to be there each step of the way – from installation and management to repairs and upgrades. Cloud-based technologies have since eliminated the need for IT teams to spend their time manually managing and upgrading software patches and updates, as cloud systems automatically update in the background, enabling IT to spend time focusing on other priorities, and teams to work without interruption.
As volumes of data and the accompanying regulations increase in the coming years, organisations will be forced to prioritise transparency, efficiency, and auditability when completing their filings, audits, and reports. If they want to survive, they’ll need to meet these challenges head on with future proof, cloud-based solutions to modernise processes, control and encourage collaboration, and secure access in an integrated environment.
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