WASHINGTON, June 17, 2014 /PRNewswire/ -- While accurate forecasts are crucial for companies introducing new products, contemplating acquisitions or preparing for changes in the economic environment, few companies employ technology specific to corporate financial planning and analysis (FP&A), according to a survey report released today by gtnews, the global financial information resource.
Findings from the gtnews FP&A Technology Survey, sponsored by Wdesk, show that CFOs and corporate controllers typically rely on spreadsheets for planning, but they aren't fully satisfied with results. In fact, the survey reveals that the main challenge companies face in monthly reporting cycles is time spent identifying and correcting spreadsheet errors.
Among companies that do use more sophisticated technology, most rely on a few very large systems. Due to the expense and complexity of customizing and maintaining these systems, however, FP&A models are often being used as 'black boxes' primarily for consolidating data rather than for planning purposes. Finance teams are forced to build ad hoc spreadsheets to meet specific needs.
"We're seeing a tendency among companies to put off investment in FP&A support even when they know it's not enough to merely collect data. Companies must interpret data, understand what future variations may mean, and then be able to act," said Graham Buck, editor of gtnews.
Half of those surveyed reported budgetary constraints as the main barrier to adopting FP&A systems. Another 40 percent reported the lack of IT support as an obstacle.
"A small, but rapidly growing number of forward-looking companies are using new cloud-based technologies to free their FP&A teams from the continued housing and consolidating of ad-hoc data in Excel spreadsheets, as reported in the gtnews survey," said Joseph Howell, Co-Founder and Managing Director of Wdesk. "These cloud-based solutions provide greater flexibility, an intuitive user interface, and automation of manual tasks so teams can spend more time analyzing data. They also provide up-to-date data in real time, eliminating the need for costly IT support."
KEY SURVEY FINDINGS
- 53% - Do not use systems specifically designed to provide analytical support to the FP&A function.
- 53% - Spreadsheets are the main FP&A tool for analytical support.
- 22% - Displeased with the effectiveness of spreadsheets for the FP&A function
- 53% - Find their FP&A system (if they have one) to be effective in meeting organisation's analytical needs, indicating room for improvement.
- 64% - Consider the time spent identifying and correcting reporting errors a reporting challenge
- 58% - Use Excel for FP&A-related reporting needs
About the Survey
In March 2014, gtnews issued a 20-question survey to subscribers in the corporate financial planning and analysis field, resulting in 224 responses. Respondents were located in the Asia-Pacific regions (34 percent), North America (31 percent), Europe (24 percent) and the African sub-continent (11 percent) – from a wide range of industries.
Download the research on www.gtnews.com/research
gtnews, part of the Association for Financial Professionals, is the leading online knowledge resource for global treasury, finance, payments and cash management professionals. Under the guidance of an advisory board of European and Asian treasurers, gtnews provides weekly updates and an archive of over 8,500 articles, research reports, commentaries, webinars, and whitepapers with a global finance focus. The annual gtnews Awards for Global Corporate Treasury and Finance celebrate best practice in finance projects and provide executive level education and networking opportunities. Follow @gtnewsdotcom