Accountants and finance teams have an opportunity to lead their organisations to better business decisions driven by insights from analysis of big data, rather than following a familiar pattern of reporting on past events.
The profession needs to prove its future value by evolving from reporting on previous performance towards forward-looking analytics that help businesses make swift and robust decisions in real time.
A new report from ACCA (the Association of Chartered Certified Accountants), Chartered Accountants Australia and New Zealand (CA ANZ) and NTT DATA reveals that the technological revolution has thrown up an unprecedented chance for finance professionals to champion and lead the use of data analysis, broadening their influence.
However, a survey of 1,150 accountancy professionals showed many were slow to leave behind traditional reporting of results.
Author Clive Webb, head of business management, ACCA, said: ‘Our survey shows some reluctance to move from looking backwards to looking ahead. Traditional reports are in the comfort zone for most finance teams. But the most progressive and successful finance teams are those that use data to look ahead to remain relevant in organisations.’
The report - Analytics in Finance and Accountancy - added that finance professionals using forward-looking tools are vital to their organisations. These include predictive analytics, which uses existing data to make statistical models of what is predicted to happen in the future, and prescriptive analytics goes a further step by suggesting a course of action from a set of options.
Utilising these two forward-looking disciplines, organisations can predict future performance and be helped with making the best decision available to them.
Helen Brand OBE, chief executive of ACCA, said: ‘Many accountancy and finance professionals are still using rearward-looking analytics: reporting on past performance and telling their stakeholders what has happened. There has never been a greater need to invest in forward-looking analytics.
‘Accountancy and finance professionals need to ensure they are developing skills in the appropriate directions, to provide our stakeholders with forward-looking insights.’
The report was also based on 30 detailed interviews with finance leaders and data specialists from a range of industries across the globe.
‘The research highlights an industry evolving from handling just financial data towards dealing with a diverse array of financial and non-financial information and data,’ said Ainslie van Onselen, Chief Executive of Chartered Accountants Australia and New Zealand.
‘This is enabling organisations to make data-driven decisions more quickly, driving tangible results. One example is the use of different data types and predictive analytic tools by finance teams during the COVID-19 pandemic. This has enabled finance teams to truly partner with the business, providing them with the insights needed to make better faster data informed decisions amidst the uncertainty presented by the global pandemic.’
ACCA and CA ANZ have both been updating their qualifications to ensure members and future members can develop the right skills needed to understand and apply the insights data can offer. ACCA has just launched a cost-effective online course, the Certificate in Data Analytics (CertDA) to provide learners with a strong understanding of data analytics and how it can unlock new opportunities.
Chief Financial Officers (CFOs) are increasingly being required to act as enablers of decision making for the whole organisation, based on interpreting the vast amounts of data now available to them.
Analytics can be vital in driving business efficiencies, risk management, planning, budgeting and forecasting.
The report identified five key areas of focus for businesses to create a data-centric culture, including strong governance, improving big data capabilities, making sure an organisation has the right capabilities and opportunities to educate employees about data literacy, showing how insights can help to make strategic decisions and using predictive and prescriptive analytics.
Simon Williams, CEO of NTT DATA UK, said: ‘Becoming a data-driven organisation is the common goal of businesses around the world. Building the capability to make better use of data, through predictive and prescriptive analytics, lies at the heart of almost every digital transformation project. It’s about making decisions based on data and not conjecture.
‘This report demonstrates that it is not sufficient to simply build the tools in order to be data-driven. A business needs to instil the skills, knowledge, and the capability within its people to build a data-centric culture and create trust in its data.
‘Accountancy and finance professionals are well placed within modern businesses to be the champions of trust in data. They hold many of the skills required to cover the bridge the gap between data scientists and business leaders, and by supporting them with training and support, businesses will be able to bridge any data skills gap. With the right skills and tools, they have the ability to fuel the success of their businesses and create tangible, long-lasting results.’
- Ends -
Notes to Editors
The report Analytics in Finance forms a keynote session at a major global ACCA webinar Working Together, Thinking Digital, focussing on recovery on Tuesday 16 September. As well as a discussion of the key elements of the report, leading UK digital retailer Sainsbury’s Argos explains how it is using analytics to improve the business. Every session of the webinar is free to access: for the full programme and to register here https://vshow.on24.com/vshow/DigitalVirtualConf/registration/17980
ACCA is the Association of Chartered Certified Accountants. We’re a thriving global community of 227,000 members and 544,000 future members based in 176 countries and regions that upholds the highest professional and ethical values.
We believe that accountancy is a cornerstone profession of society that supports both public and private sectors. That’s why we’re committed to the development of a strong global accountancy profession and the many benefits that this brings to society and individuals.
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Through our world leading ACCA Qualification, we offer everyone everywhere the opportunity to experience a rewarding career in accountancy, finance and management. And using our respected research, we lead the profession by answering today’s questions and preparing us for tomorrow. Find out more about us at accaglobal.com
About Chartered Accountants Australia and New Zealand
Chartered Accountants Australia and New Zealand Chartered Accountants Australia and New Zealand (CA ANZ) represents more than 125,000 financial professionals, supporting them to build value and make a difference to the businesses, organisations and communities in which they work and live. www.charteredaccountantsanz.com/
About NTT DATA UK
NTT DATA – part of the NTT Group – is a trusted global innovator of IT and business services, headquartered in Tokyo. We help clients transform through consulting, industry solutions, IT modernisation and managed services. NTT DATA enables clients to move confidently into the digital future. We are committed to our clients’ long-term success and combine global reach with local expertise to operate in over 50 countries. Visit us at nttdata.com