Finance leaders have trust issues with their data

For finance leaders and their data, it’s a matter of trust — or the absence of it.

Almost 40% of CFOs worldwide do not completely trust the accuracy of their organization’s financial data, according to a recent survey.

BlackLine, a digital finance transformation organization, found that 37% of CFOs said they do not trust their own data, and about 50% of senior finance and accounting professionals said they do not fully trust their data.

The survey was conducted from more than 1,300 C-suite and senior finance and accounting professionals from seven markets (the United States, Canada, the United Kingdom, France, Germany, Australia, and Singapore).

“Trusting the data organizations work with is critical for effective decision-making, not only for the office of the CFO but for the entire business ecosystem,” BlackLine co-CEO Owen Ryan said. “This is especially important when dealing with external events that are difficult to predict or hard to control.”

As for external events, concern is high: 78% are concerned about another global financial crisis, 76% about the impact of cybersecurity issues, and 73% about the impact of new disruptive technology on their business.

There are other trust issues. For the second consecutive year, 98% of all respondents said they do not have complete confidence in the visibility their organization has over its cash flow, and 37% said that understanding cash flow in real time will be critical for their company’s ability to deal with unpredictable market changes.

The lack of confidence in cash flow visibility can affect business response time. Almost half (48%) said it’s harder to respond to market fluctuations, and 47% are concerned that they are making decisions based on inaccurate or out-of-date information.

Manual processes are hurting trust

Antiquated manual processes and human error can lead to inaccurate information. When asked why they don’t completely trust their organization’s data, 31% of respondents said the data comes from too many different sources, 27% cited a reliance on clunky spreadsheets, and 25% named outdated processes, including manual data collection.

Almost two-thirds (64%) of respondents said the overwhelming volume of manual work leaves little or no time for financial planning and analysis, and more than two-thirds (68%) said that manual work leaves their organization vulnerable to errors that could undermine business decision-making.

Finance leaders said modern businesses must embrace new technologies like AI to streamline their financial operations. They said that cloud computing (80%), generative AI (78%), and new kinds of AI (76%) are essential for improving business resiliency in the future.

— To comment on this article or to suggest an idea for another article, contact Kevin Brewer at Kevin.Brewer@aicpa-cima.com.