Darren Cran, CEO, AccountsIQ
A new tax year begins with new increases to National Insurance rates for employers. With businesses already facing pressure to manage costs as economic growth remains stagnant, these changes add an array of additional pressures to a CFO’s workload. To make matters more uncertain, inflation made a surprise and higher-than-anticipated leap to 3%.
Concurrently, the role of finance teams has become more complex: their responsibilities extend beyond simply ‘overseeing the numbers’ and they are expected to have a deeper, wider impact on overall business success. AI, in particular, will continue to exert its influence on finance processes in the coming year – are companies ready, or even open to it?
Yet a new tax year is also a clean slate for new opportunities and achieving better. The frontrunners are the finance teams who can best harness new technology to innovate, adapt and strive for more. These are the ambitious achievers: the mature businesses with firm ambitions, proven success and a growth mindset.
But how do CFOs and finance teams become ‘ambitious achievers’ in the new tax year?
Finding a tailored solution for your business
When companies scale, they can be caught between holding onto software that no longer meets their needs or adopting expensive software that has excess features. So, finding the right finance software for their size is fundamental to gaining the optimal level of (cost) efficiency, value and capabilities.
A fast-growing company, for example, may need to consolidate accounts across multiple entities but its current platform doesn’t provide multi-entity accounting features. Likewise, a medium-sized company may feel compelled to upgrade to an ERP system but, as it’s designed for larger companies, this leads to unnecessary costs, migration complexity and usability issues. The same of course is true when an organisation becomes a large corporation and outgrows its mid-tier applications.
The key question to ask amongst all of this is: do you have software that can grow with you, automate an evolving range of processes and integrate new technologies?
Finding software of the right size can trim costs while enhancing efficiency and overall company performance: it enables finance functions to both scale and adapt to changes in the market. CFOs should assess what products are within budget and can tackle their finance team’s most pressing pain points.
The power of automation
With so many pressures on a finance team’s workload, automation has become an essential tool. Many teams are still tied to manual data entry and spreadsheet processes and use a variety of systems for different finance purposes. This is not only inefficient and time-consuming but limits access to quality and accurate insights from across the business.
Cloud financial management systems offer a range of automation capabilities, including extracting and inputting data from expenses, sending recurring invoices, and conducting month-end reporting. This significantly reduces errors and speeds up end-to-end financial processes. Imperatively, these platforms can integrate with a range of business systems to create a central location for company-wide data.
By streamlining processes through automation, CFOs and their teams can free up time to conduct value-added analysis on their data. They can become, as is expected from the modern finance professional, direct contributors and advisors to business performance.
Re-shaping the finance team of the future
If we were to visualise the traditional finance function as a pyramid reflecting time spent on each task, the base would be weighted heavily towards transactional processing, followed by a mid-sized section for compliance and reporting, with a small top segment dedicated to business decision-making.
However, with the effective automation of data capture, processing and reporting, this structure can be flipped on its head. In this transformed finance function, business decision-making takes the dominant position, while the time spent on transactional tasks and compliance significantly decreases. Transactional processing, for example, simply involves human oversight and quality assurance rather than carrying out the tasks themselves.
Forging ahead with AI
No discussion about today’s finance function can take place without AI. The technology is already bringing groundbreaking developments to data processing, reporting and analysis. Instead of just automating the reporting process, for example, a CFO could ask to retrieve reports in various formats with instant results. And by using integrated tools like ChatGPT, they could ask for comparisons between datasets like hypothetical and actual P&L statements.
Of course, hype and a lack of AI governance continue to stall companies from using AI. But these objective data processing, analysis and formatting tasks are the areas where AI works well – and its use could help finance teams forge ahead.
Achieving high ambitions
With constant external uncertainties at play, having access to better insights can help businesses navigate disruption more effectively. Without them, companies might resort to hasty cuts without seeing what other resource allocation options are available to them.
The right-sized financial software can offer the perfect range of capabilities for its price and give CFOs access to insights far faster and more accurately. Crucially, this enables them to put business decisions at the heart of their finance function. And the real ambitious achievers will identify where AI can have an impact and safely integrate it into their process.
This new tax year has many challenges. But, with the right tools and processes, it holds great opportunities to set ambitions high – and to achieve them.
