Data Consolidation & Integrity in FP&A
Smart financial planning and analysis is the foundation of any critical business decision. In order to maximize the quality of FP&A, organizations must be able to use thoroughly researched and compared data, and have no doubt regarding its accuracy. Data integrity and consolidation are hence two indispensable considerations for finance professionals.
Key tasks involved in data consolidation include: The unification of cross departmental information, centralization of the command and management systems, and budget-actuals comparisons. Many (if not most) companies use a combination of a spreadsheet and a system in order to complete these tasks. It is typical to use spreadsheets to perform a lot of the analysis and then use a system to help consolidate information and organize the data for different kinds of reports and further analysis.
The benefit of this approach is an opportunity to use Excel spreadsheets to provide a lot of analysis, especially around the business drivers, so assumptions and backup information are kept. The system is then used mainly for consolidating data and providing different levels of reports.
Having discussed the criticality of data consolidation, organizations must know and use the proper methods to ensure the accuracy of their FP&A data. As organizations harness business intelligence and data analysis technologies, a broadening range of techniques can be employed to improve the quality and visibility of planning information. According to Gartner Inc, one of the best ways organizations can improve FP&A accuracy is the adoption of AI-based analytic technologies.
The automation of FP&A tasks, and the overall integration of these technologies has been widely recognized as some of the leading trends in the world of finance. What these technologies offer is a way to evade human mistakes in FP&A, in which the margin for error is ever so small. The smallest, single mistake in an excel sheet can be (and has proved to be in multiple scenarios) the deciding factor in the overall quality of an FP&A report. Automated processes mitigate the risk of these small yet crucial mistakes, which is why FP&A software is a popular resource in the world of contemporary finance.
Solution to both concerns
The quality of the research and integration of financial data, as well as its accuracy, must be prioritized by an organization’s FP&A sector. Excel spreadsheets are not a bad tool to use in financial analysis, but it is clear that a company needs to integrate a quality FP&A software in order to be able to: 1. Ensure accurate data and evade human error. 2. Consolidate data and produce a variety of different reports.
Among other FP&A software organizations, DataRails stands out as a powerful solution to data consolidation and integrity; it uniquely offers a Cloud-based software that allows organizations to continue using Excel spreadsheets, while reaping the benefits of a CPM Software.