The future of finance in action
Here’s how one company used RPA to transform its business
The accounting profession’s leadership got a first-hand account of how technology is transforming businesses at the AICPA Spring Council in Washington, D.C., on Monday.
During an afternoon session on the future of finance, panelists Michael Burns, CPA, CGMA, and Janice McClure, CGMA, discussed how German-based polymer manufacturer COvestro LLC continues to transform finance by deploying the latest developments in technology and leveraging data. Burns and McClure are both based in Pittsburgh in the US.
The case study illustrated how technology is allowing finance departments to shift their focus from traditional tasks to becoming strategic partners with the rest of the business. For example, machine learning has been applied o automate the calculation of accruals for freight costs, a process that involved several thousand transactions of small values
Burns, the director of controlling, and McClure, a senior business analyst, shared that not only were significant time savings achieved but also that there was an improvement in the accuracy of these accruals when compared to actuals. They also explained that the company uses robotic process automation (RPA) to actually make the accruals.
Covestro is on a “single-instance” of enterprise resource planning (ERP) and on a single global chart of accounts. Standardization has enabled the company to collect large amounts of data on a common platform, and by applying data science and machine learning, it can now identify trends and insights in entirely new ways.
“Finance has an unprecedented opportunity to shift from being a cost centre to becoming an architect of value for the enterprise. Finance can now spend more time supporting the business instead of spending time in production in the back office.” said panel leader Ash Noah, CPA, CGMA, vice-president and managing director of Learning, Education & Development at the Association of International Certified Professional Accountants.
Burns elaborated on the changes he’s seeing in finance departments in a separate interview with the Association.
“So instead of using my time to create reports, now we are interpreting those reports, explaining what this means for our business,” he said, “Now we are sitting at those decision-makers’ tables and being an equal voice in what those results mean.”
The changes brought on by technology also are driving a shift in the skills that finance department executives need to be successful.
“It is essential for the finance professional to understand the kind of capability that data science and data engineering brings. The CGMA Competency Framework and the Finance Leadership program address and build these competencies,” Noah said.
“Those softer skills are more important,” Burns said. “Be able to influence people, to explain. That technical financial knowledge is still critical. We are the experts that understand processes that lead to financial results that are how a company is measured.”
“That’s all critical, and I don’t see that changing in the future,” Burns said. “But instead of just providing numbers to people, we are now sitting there, and everyone is seeing the same numbers at the same time, and we’re explaining why those numbers mean what they mean, how do we influence those going forward, and there’s so much more focus on forward-looking activity versus the recording of transactions.”
New research from the Association provides a clear picture of what the finance function looks like in a digital world, as well as how finance continues to evolve.
Resource Credit | Financial Management Magazine