Finance teams are the strategic center for the critical processes that drive any business: planning, budgeting, reporting, and analysis. As any business grows, those processes become more difficult and time-consuming. Tedious manual processes can become overwhelming. With the onset of Base Erosion and Profit Shifting (BEPS) Pillar Two geographically dispersed teams, collaboration and context becomes more difficult.
By aligning these core activities around two complementary software tools, finance teams can master the end-to-end process of planning for the future, monitoring performance, and analyzing the numbers to identify opportunities, threats, and possibilities for improvement.
The End-to-End Financial Paradigm
In most companies, finance teams perform a continuum of activities in which planning and budgeting form the starting point:
- Looking to the future
- Identifying opportunities
- Determining the best way to allocate resources
- Laying out a realistic roadmap for the coming year
Next comes reporting, where the finance team and other departments collect and collate the results of the business’ activity to date. Finance teams organize and format that information to suit the needs of operational decision-makers throughout the organization.
Finally, there is the deeper analytical work that finance teams perform, shedding light on the trends and opportunities that are likely to be meaningful to the success of the business. Executive managers benefit greatly from having dashboards and real-time KPIs to keep them informed in real time. Especially as tax reporting becomes more sophisticated.
Planning, budgeting, reporting, and analysis activities are related, but they all have their own distinct nuances. Each has its unique role to play in the health and success of the organization. Most businesses think about these as separate operations – in part because they involve overlapping groups of stakeholders and happen at very different points in the financial decision-making lifecycle.
Disconnected Processes Are Slower, Error-Prone, and Costly
Many businesses have come to rely on multiple technology products to get these jobs done. ERP systems are great at managing transactions as they happen, and they’re reasonably good at storing and reporting on budget numbers by general ledger account. However, they are poorly suited to developing the detailed plans and budgets that drive those numbers in the first place.
Many organizations rely on Microsoft Excel or other spreadsheet applications to combine historical data with future projections and “what if” scenarios, ultimately leading to a financial plan that reflects the realistic aspirations of the company for the coming year. This manual workaround
usually results in a collection of disconnected spreadsheets, Word documents, slide presentations, and emails.
All that information is difficult to manage because:
- Multiple versions of the same document can easily get out of sync.
- Important contextual discussions may be lost along the way.
- There’s very little in the way of an audit trail to determine who made changes, what exactly was changed, and when.
- Spreadsheet errors are common, and a single formula error or copy/paste mistake can lead to the numbers being wrong.
Many of the same issues arise in the downstream activities that the finance team performs – including the generation of operational reports, KPI metrics, and financial statements. Very often, these are achieved using spreadsheets. All the same challenges show up here as well, namely, tedious, time-consuming, error-prone processes that lack coherence and control.
Improve Your Reporting and Eliminate Errors
Tax and transfer pricing software solutions, like Longview, are of immense strategic value. Not just because they reduce your time spent creating reports, but also because they end your reliance on manual spreadsheets that require countless hours checking and double-checking thousands of lines of data for accuracy. You’re able to standardize your data and processes, which allows for automated calculations and reporting with improved internal controls. Automating your tax data collection and calculation improves your data consistency and helps gives context to what you are reporting on. Knowing the big picture is key as the cost of non-compliance is significant and in an unfamiliar regulatory environment this risk skyrockets.
By leveraging an analytics solution like CXO, not only will you benefit from instant access to accurate tax data, but the information will also be in a format that enables your team to understand the context behind the numbers. These sophisticated data analysis solutions allow your team to focus on telling the story behind your numbers, rather than just crunching the numbers. Your tax team can be more confident that they have the right data to provide accurate returns to relevant authorities in a timely manner.
Create Deliverables Anyone Can Understand
With greater efficiency and accuracy in reporting comes the need to better communicate the insights gleaned from your reports. It’s not enough just to have a well-formatted report that anyone in the tax and finance areas can read and understand; you need to also deliver visual analytics that are digestible for stakeholders outside of finance. And new regulations will mean new reports that your executives have never seen as Pillar Two has brought Tax into focus at the CFO level. You need to make these as simple as possible to bring stakeholders along the journey with you.
Data visualizations are key to illustrating the patterns and connections within your data that tell your organization’s story. For example, typical spreadsheet bar graphs can show the current status of an account, but they cannot show the long-term trends or development of the account, or how it interacts with other accounts over time. But with the right software solutions in place, you will be able to create dynamic point of view bar graphs that combine accounts and show trends over time, illustrating your organization’s story to your stakeholders in clear, easily understood terms.
Leverage your reporting software to create an array of easy-to-digest deliverables that tell the story behind the numbers, including both financial and nonfinancial data trends and multi-scenario analyses for deep insights and the ability to forecast quarters and even years into the future.
Take your insights to the next level with CXO and Longview. You’ll improve your analytics capabilities with a modern, streamlined interface that eliminates the heavy analytic administration burden. Longview offers accelerated planning, consolidation, tax, and transfer pricing, while CXO adds modern analytics to your process. This means you can transform your insights, for the group and each entity, into a compelling and comprehensive narrative.
To learn more about how Longview and CXO can benefit your organization, contact us today for a free demo.