The role of the Chief Financial Officer (CFO) is subject to a range of new pressures today. While the traditional duties of the CFO are unchanging, the timeframe and strategic context affecting the work are evolving rapidly. To do his or her job properly, today’s CFO needs the best information from an assortment of sources. Realizing this goal is invariably a matter of software and data management. Enterprise Resource Planning (ERP) solutions are the best resource in this regard. Here are five ways ERP software helps the CFO.
5 Ways ERP Helps the CFO
1) Comprehensive Accounting Data
The CFO is the company’s top financial controller. He or she is responsible for all financial reporting and accounting processes. ERP solutions typically offer financial management as a core feature. However, there’s more to it, from the CFO perspective. Truly meaningful financial management and accounting practices depend on having a complete view of the business. ERP can integrate other relevant data sets into accounting workflows. For example, with ERP, it is possible for the CFO to see procurement, invoicing and cash flow management simultaneously. This way, he or she can be aware of operational factors that might affect the company’s finances quickly enough to act on them.
2) 360° Treasury Management
As the company’s top treasury manager, the CFO has to understand the complete financial condition of the business. ERP offers a three hundred sixty-degree view of all the issues that might affect finances. For instance, by being able to see receivables aging reports against projected debt service, the CFO can achieve a high level of awareness about the company’s ability to operate.
3) Data-Driven Financial Planning
The CFO has to plan for the company’s financial future. This might include cash management, borrowing, debt restructuring, equity raises and so forth. ERP provides data from operational areas of the business that can affect financial planning workflows. This might include data inputs from external sources, such as interest rate projections and other economic indicators.
4) Real Time Compliance and Taxation Awareness
Compliance is usually one of the CFO’s duties. The specifics of these obligations will vary by company size and industry context. However, in general, ERP gives the CFO a high-level toolset for managing compliance and tax-related reporting. Segregation of Duties (SoD), for example, a required control for several regulations (e.g. Sarbanes Oxley), manifests in the ERP system. The CFO can use the ERP reporting interface to investigate the state of SoD in the organization to ensure compliance or remediate deficiencies in the control.
5) Informed Corporate Strategy
In most companies, the CFO is not only the senior financial executive. He or she is also one of the most senior and influential managers in the entire enterprise. As part of the “C-Suite,” the CFO is expected to offer informed insights about major strategic and operational decisions. ERP gives the CFO the data he or she needs to serve in this role.
Learn more about Cloud ERP for the CFO.
Making CFO Work for the CFO
ERP software doesn’t automatically bestow all of these benefits on the CFO. It has to be configured for the purpose. This is a process that involves understanding how a business operates. From this discovery, ERP can be implemented so it gives the CFO the full spectrum of operational and financial data he or she needs to perform optimally as the company’s head financial executive.
Learn more in:
Top Technology Challenges for the Modern CFO