How CFOs can use fast access to financial data to instill trust in their companies

Financial data underlies everything that a Chief Finance Officer (CFO) has to determine or predict or make forecasts on for the company they support. Building any financial planning model on a business requires access to the financial data across the whole organization - budgets, invoices, revenue, payroll, and more - historical and recent. CFOs and Fractional CFOs have to undertake a lot of this work manually, which poses a data accuracy challenge - more than 90% of spreadsheets contain serious errors. The need for accurate and standardized data for reporting and predictions is key for the businesses relying on their CFOs and for the CFOs creating the reporting. Access to accurate, real-time, and clean financial data empowers CFOs to trust their data sources, prepare more accurate forecasting, and instill trust in the companies they work with.

With access to data from the source, CFOs can have more trust in a company’s financial data and models

CFOs need to be sure they are instilling trust in the company they work with through their financial management. In order to instill trust amongst their team and company, the CFO needs to trust the data they have is accurate, up-to-date, holistic, and historical. If the CFO is getting data from various sources for one company, it can be messy and riddled with errors, which means the data and its sources are not trustworthy sources to build models off of. 

CFOs are provided the financial data from the companies they work for through different means, such as spreadsheets, paper documents and receipts, various and dispersed software systems not shared cross-organizationally. For Fractional CFOs, the challenges are even more pronounced - receiving information through email, access to various company cloud platforms, and more from a variety of companies they support. Of those in accounting and finance who do not completely trust the accuracy of their financial data, 41% cited manual inputs leading to human error as their top concern. Accessing all a company’s financial data in one place, through limited sources of truth, helps limit the errors associated with various places to access data. If the data is trusted, the models can be trusted. 

When a CFO is building financial models or presenting information to their companies and the board, they want to be sure their information is the most accurate it can possibly be. Trust in the data and where the data comes from is the first step in ensuring the models are correct. 

With access to real-time financial data, CFOs can provide faster updates to their companies

CFOs need all of their company’s financial information in order to properly strategize and make models for Financial Planning and Analysis, budgets and cash flow, and general forecasting. In order to make real-time decisions and provide information fast, the CFO needs access to real-time financial data across all the various accounting service providers and financial management platforms and financial components of the companies they serve. 

When a company wants to receive updates regularly, having real-time access to financial data enables CFOs to present up-to-date information to their companies and account for drastic changes in the moment. 

With access to historical financial data, CFOs can provide more accurate updates to their companies

CFOs make predictions on a company’s performance based on a past precedent. In order to build these predictive models, they ideally have access to the company’s historical financial data. By having easy access to reliable, historical financial data, building financial forecasting models becomes a simpler and faster process. According to  Ashish Pareek, VP and Head of Financial Planning and Analysis (FP&A) at Jackson Hewitt Tax Service Inc., only 1% of organizations achieve 90% forecasting accuracy 30 days out. To build better forecasting models, you need access to accurate historical data. When a company wants to trust their future performance, having access to historical financial data enables CFOs to present accurate forecasting to their companies. 

When companies know that the forecasting, planning, and budget their CFO is carrying out on behalf of them is built on historical data from their company, they have more trust in what they’re being presented with. 

CFOs need financial data to instill trust, provide faster updates, and access historical information

CFOs are looking for software and tools that support accessing accurate financial data for modeling. Providing access to financial data through easy-to-access means is part of ensuring CFOs trust their data and sources, can instill trust in the organizations they work with, and that they can provide fast and accurate updates to the company that needs them.