It's time for businesses to start building trust from the bottom line up
Do businesses have a trust problem? In Australia, unfortunately, the answer is a resounding 'yes'. Our big banks are the latest to come under the microscope, courtesy of a Royal Commission which has exposed a slew of dubious practices.
Bad behaviour isn't the only thing that can cause customers' trust in an organisation to nosedive. Poor quality accounting and financial record keeping can put an equally big dint in customer, staff and shareholder trust.
It starts with trustworthy data
Trust in a company's numbers – the data produced by invoices, payments and expenses – isn't an esoteric concept. It's as real as the extra costs, in dollars, time and even reputational damage, which can be exacted if the integrity of that data is found wanting.
A material error in an organisation's figures can do as much, if not more, damage than a faulty product recall or publicly exposed instance of sharp practice. It can also be costly to locate and fix. Ongoing processes may need to be suspended while accounting staff make their corrections. Meanwhile, the reputations of the employees responsible may also take a knock that's even harder to repair.
Turning to the cloud
Latest generation tools and technologies can play a major role in ensuring the integrity of the financial information which companies use to inform decisions and report their positions. Moving away from legacy accounting systems and adopting cloud-based software with a strong automation focus can help ensure data is dependable and all enterprise systems are working with a 'single version of the truth'.
Accounting automation can assist organisations to implement more robust fraud prevention measures and flag up faulty or missed items faster. It can be harnessed to limit transaction amounts and maintain segregation-of-duty safeguards that make it impossible for the same individual to both request and authorise payments.
Intelligent workflows can help ensure statements are reviewed on time and by the correct personnel. This means if mistakes or unauthorised transactions do occur, they have a better chance of being picked up sooner.
Built-in process intelligence can be used to measure the performance of the processes themselves and to develop Key Performance Indicators.
Process intelligence is also an essential element of 'continuous accounting'. This term refers to the processing of month-end tasks in near real-time across the accounting period, not just at the end of the month.
Evening out peaks and troughs in monthly activity can reduce stress on accounting staff and reduce the chance of errors occurring during busy times.
Ensuring big data is accurate data
The big data revolution has resulted in many organisations handling growing volumes of data on a regular basis and using it to extract insights that inform key business decisions.
The robustness of the finance group's reporting methodology can affect the accuracy of this data and, consequently, the quality of these decisions.
Many legacy accounting systems require data to be transferred to a separate reporting tool prior to its being analysed. This process carries an inherent risk that data will be corrupted during the transfer or changed while the report is in progress.
Cloud accounting software which enables data to be analysed 'in situ' reduces the risk of this occurring.
The first steps
It's impossible to trust in the integrity of corporate reports if the systems used to generate them don't support rigorous checks and controls. Migrating to cloud-based accounting software enables organisations to be confident the figures they're relying on are sound and the data they generate can be used with confidence in the decision-making process.
