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time. The human accounting involved
in the process will also decline.
Reporting will take an entirely differ-
ent meaning in organizations. A re-
port by definition is a backward look.
Self-service reporting, where organi-
zational managers will be taught by
their finance business partners how to
extract the information they need, will
replace the need for defined periodic
reports. Instead, smart finance profes-
sionals will be required to provide in-
sights into the future.
This is the challenge for next-genera-
tion finance professionals. Already in
world-class companies, not only has
the volume of standard reports pro-
duced been significantly reduced, but
also, more importantly, a greater pro-
portion of the remaining reports are
forward-looking insights.
It must also be said that reports will
need to be automated and dynamic,
and take the form of intelligent dash-
boards based on data visualization
techniques that engage the audience.
Once again the human element of pro-
cessing reports will decline, but a dif-
ferent human element will be called for.
Finance professionals will be called on
to play a major role in this reporting
shift if they are to retain their influence
in organizations.
Finance has traditionally played a sig-
nificant and sometimes preferred role
in respect to organizational controls
from simplistic reconciliations to au-
dits, forensics, and even governance.
This is perhaps the space that has
been impacted the most due to digi-
tization and automation. Processes
involving data sharing and distribution
from one point to another are digitally
verified, and thereby dynamic controls
have been embedded. Therefore, the
significant involvement of finance pro-
fessionals in the traditional controls
space is disappearing.
Instead, there is a need for finance to
shift its focus to dynamic and perhaps
preventive controls, as well as risk
management, using significantly more
sources of data. With this shift, the
transformed finance function should
be able to play an even more important
role in stewardship and governance
within organizations.
The top of the pyramid is the space
where big data and analytics must play
the most significant role in the trans-
formation of the finance function and
the shift of the finance professional to
the role of a trusted and valued busi-
ness partner.
The pre-digitization era restricted
finance to a narrow window of organi-
zational data mostly financial and
therefore prevented the finance pro-
fessional from using the significant
management accounting tools and
techniques that he or she is taught.
The current era of big data and ana-
lytical platforms has opened up an en-
tirely new opportunity in which finance
can get involved: strategic decision
support. This is perhaps where the fu-
ture of finance and the finance profes-
sion is. Let's explore this role further.
The CFO function has the important
prerogative of being able to cut across
the entire organization. This opens to
the finance professional access to all
of the organization's data, not just the
financial data. Thus, the opportunities
for providing decision support are sig-
nificant and can lead to more engaging
business partnering.
Increasingly, finance professionals are
called upon to play an expanding role
in organizational strategy as well as in-
tegrated reporting. It is in this context
that big data and analytics have the
most influence. Finance must broaden
its perspective to harness all organiza-
tional data as well as external data to
construct the bigger picture of the or-
ganization in its operating environment
and, more importantly, to add value.
Thus, budgeting will no longer be a sim-
plistic spreadsheet exercise of trans-
posing a set of sales figures provided
by the sales and marketing manager to
a financial spreadsheet, but rather will
involve working closely with the busi-
ness managers to add significantly
more robustness to operational projec-
tions based on multiple sources of in-
ternal and external data that has been
analyzed and related to drivers that in-
fluence the bottom-line outcomes.
Finance professionals should be able
to combine their powerful manage-
ment accounting skills and exploit
management accounting tools to con-
vert data into predictive insights. In this
way finance can definitively claim that
it is influencing the organization's stra-
tegic direction.
Further, the traditional simplistic bud-
get-to-actual variance reporting must
give way to a much more insightful
understanding of organizational perfor-
mance. Combining the analytics and the
AI perspective, such performance man-
agement will not only be dynamic but
also be customizable in order to influ-
ence different parts of the organization.
A number of analytic and data visu-
alization software platforms allow fi-
nance professionals to provide the
strategic decision support demanded
of them. Many other value-adding op-
portunities can open to finance profes-
sionals in this space. The limit is be-
yond imagination.
The challenges for finance profession-
als in the fast-shifting era of big data,
analytics, and AI are many, the most
important being a willingness to keep
an open and changing mindset. The
other factors are improving and en-
hancing technical skills in analytical
sciences such as statistics as well as in
the use of analytic software platforms.
Don't miss AICPA President & CEO
Barry Melancon as he discusses the
massive changes technology is bring-
ing to the accounting profession at the
2018 CTCPA Annual Meeting.
Details on page 5.
Aubrey Joachim is the founder of
Leading Edge Change, a business-
partnering firm in Australia. He
is a past global president of the
Chartered Institute of Manage-
ment Accountants. This article first
appeared in CGMA Magazine. For
more articles, sign up for the daily
email update CGMA Advantage at
Wednesday, May 16 Cascade, Hamden
Connecticut CPA
March/April 2018
2017 Association of International Certified Professional Accountants. All rights reserved.