Unprecedented. It’s a word that’s often bandied about in a hyperbolic sense, but in the case of the global COVID-19 pandemic, it’s one of the most apt descriptions of what the world is facing.
COVID-19 is an unprecedented event that has affected every single part of life on the planet, including leaving an indelible mark on business. With the rapid shifts in working environments and the economic and currency fluctuations faced by all organisations, the business tools needed to keep track of and accurately report on finances are being stress-tested to the extreme.
New challenges
Some of the particular and ongoing challenges in the current reporting climate are the safety of existing systems, ease of access and usage, the level of detail available in reporting, and shifting reporting criteria as a result of the pandemic.
Having finance teams working from home means that the security of financial reporting software needs to be robust and able to withstand the risks associated with remote working. This extends to everything from accurate version control to providing staff with secure access to sensitive financial information. Basic spreadsheet systems do not account for files located on an individual’s PC outside of a database or internal network system, and accurate reports from different periods cannot easily be recalled and published.
Spreadsheets also have limited drill-down functionality. If someone needs a breakdown per cost centre as they review budgets, can they get it? If not, the finance team needs to manually create a new report with formulas linking to all the different spreadsheets. This process needs to be significantly simpler for teams to work efficiently together, especially outside of the office environment.
In terms of reporting requirements, the ripple effects of COVID-19 are still developing, and this means reporting software needs to have a strong element of flexibility and ease of use. As Mazars outlines, reporting variables in the current economy include aspects such as impairment of property, fluctuating asset values, idle capacity and whether or not COVID-19 will be an adjusting or non-adjusting event for a company’s year-end reporting.
Seeking solutions
Another question is what to do when flaws in existing manual financial reporting processes or tools are exposed. Getting outside help and investing in more robust reporting software solutions are both good options. Whichever way you go, see this as an opportunity to create sustainable financial reporting, rather than just as a short-term stopgap.
In my experience, there are a couple of key things to look for in best-in-class financial reporting software: it should be something that can be implemented within weeks with minimal reporting disruption, a self-maintaining system that will eliminate manual intervention and processes for your team, and have built-in adaptability so that changes can be implemented without incurring high development costs. Furthermore, the system should be capable of end-to-end financial consolidation, reporting and planning. These types of reporting tools offer deep-dive options, meaning that teams working from different locations around the city, country or globe can access a single source of financial and business data and adapt their models based on their areas of responsibility or reporting requirements.
In it for the long term
As organisations look to adapt to survive in the ‘new normal’, knowing exactly what’s happening in all aspects of the company’s finances is non-negotiable. Reporting needs to incorporate all essential aspects of financial management, from satisfying regulatory requirements for listed companies, to correctly assessing asset values for insurance purposes, and keeping on top of revenue, cash flow, and profit.
Finance teams are facing numerous pressures, both personal and professional, in this topsy-turvy reality. Having strong financial reporting tools is critical for making it through and cultivating a robust reporting ecosystem that can withstand whatever the future may hold. Let’s work together to build resilience into our brave new financial reporting world.
AUTHOR | FR Rhys Robinson PhD, Executive Director, Infinitus Reporting Solutions
