Budget time will soon be upon us. COVID pandemic, climate disasters, uncertain political and economic situations such BREXIT, and Afghanistan ,require more detailed and more frequent budgets and new IFRS standards compound the challenges for Office of the CFO..
Budgets are essential to a company’s yearly plan and strategy, yet many financial leaders express dissatisfaction with their current budgeting tools. According to a 2015 research study by Prophix, 79% of finance professionals are displeased with their budgeting tools. At the same time, finance professionals understand the importance of reliable budgeting. Budgets are used to understand a company’s finances, minimize unnecessary expenses, and offer stakeholders important financial information.
Why Finance Teams are Not Happy with Spreadsheets
According to the same 2015 research study, over 70% of finance professionals depend on spreadsheets to create their annual budgets. Organizing input from multiple sources is complicated when using spreadsheets and requires time-consuming manual work to enter sort, and format data. Compiled data may be inconsistently calculated or inaccurate, affecting the yearly budget’s reliability. Performing what-if analyses on spreadsheets is headache-inducing. Simply put, spreadsheets do not offer the desired qualities finance professionals look for in a budgeting tool.
Considerations When Determining a Budgeting Tool
There are a few key considerations to keep in mind when determining a budgeting tool. First, consistency within the budget is needed as data is derived from multiple sources within the organization. Consistency is important for accuracy purposes, and because data must have high auditability. Another consideration is automated processing capabilities. When simple calculations are automated you can focus your efforts on more complex issues. The ease of performing what-if analysis should also be kept in mind. Finally, the budget must be secure. This poses a challenge when multiple employees are contributing to the budget.
Corporate Performance Management Solution
A corporate performance management (CPM) solution addresses all the considerations listed above by automating processes and solving frustrations associated with spreadsheets. CPM software offers the calculating abilities of a spreadsheet, but with more advanced data consolidation and security capabilities. These capabilities make budget collaboration between departments simpler. Audit protection and ease of what-if analysis also appeals to finance professionals. CPM software is built for multiple users to collaborate in a secure way. Formatting is kept consistent, and the software is user-friendly, prompting users if additional input or approval is required.
As a real-world example, a consulting company that had previously used Excel for budgeting implemented a CPM solution from Prophix. Within two years, their budgeting process went from six months to four months. CPM software is a good fit for companies frustrated with spreadsheets and looking for a more efficient alternative.
With Prophix’s CPM solution, Dynamics users can budget faster and automate processes – all with seamless integration to your current ERP solution. To learn more about a budgeting solution that integrates with most finance and erp systems contact Synergy Software Systems , Prophix PArtners for MEA region
