Nov 14, 2018 3:12 pm ET
Finance chiefs and controllers have more data than ever at their fingertips, but the process of sorting through countless facts and figures can be burdensome for many.
Nearly half of the financial executives surveyed by Ernst & Young LLP said they spend more time gathering and processing information than they do analyzing it, according to a survey released by the accounting firm on Wednesday.
“While more and more organizations are looking at data as a strategic asset, there are still many that unfortunately have further to go before they can execute on that strategy,” said Dana Bober, financial accounting advisory services leader at EY Americas, in the survey.
Chief financial officers and controllers struggle as they often rely on multiple systems and platforms that are not fully integrated, forcing finance teams to spend a large portion of their time cleaning up and reorganizing data, Ms. Bober said.
Among the more than 1,000 CFOs and controllers responding to the survey, 63% said their teams resist digital innovation, dialing up the pressure on executives to get employee support for these changes. EY polled executives across 25 countries from companies with annual revenue in excess of $500 million.
At technology companies, senior finance leaders were particularly worried about their employees’ ability to keep up with the amount of change at their organization, according to the survey.
The findings come at a time when finance chiefs at many international companies are experimenting with automation, robots and artificial intelligence to boost the efficiency of their department.
Companies including French train maker Alstom are looking to automate certain payment and accounting tasks.
“We need to embrace the digital opportunities,” Alstom Chief Financial Officer Laurent Martinez said Wednesday in an interview with CFO Journal. Mr. Martinez declined to comment on how this would impact the number of employees in his finance department. Alstom currently employs slightly more than 1,000 people in finance.
Artificial intelligence is the tool most likely to impact significantly data-driven insight, according to the EY survey, followed by automation and blockchain technologies. “Automation will help finance teams to drive new levels of operational agility and give them freedom to focus on generating insights, while AI will harness underlying patterns in that data,” said Peter Wollmert, EY’s global financial accounting advisory services leader, in a statement.
But automation and artificial intelligence require companies to monitor these technologies to limit potential risks, the survey said.
Fifty-four percent of surveyed CFOs and controllers said concerns about data security were the biggest hurdle when introducing new financial reporting technologies. Europe’s General Data Protection Regulation, which took effect at the end of May, has added to those worries, according to the survey. Under GDPR, companies that fail to report breaches involving personal data could face fines of up to 4% of global annual revenue or €20 million ($22.6 million), whichever is higher.Write to Nina Trentmann at [email protected].
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