3 Tips to Help Maximize Your Company’s Financial Efficiencies
An article published by The CPA Journal recently warned that the accounting profession is in crisis due to a shortage of qualified accountants entering the industry.1 Fewer students are selecting accounting as a college major, which resulted in a 33% decline in first-time candidates sitting for the CPA exam between 2016 and 2021.2 Then 2022 saw the lowest number of students sitting for the CPA exam since the introduction of today’s exam in 2006.3 Further adding to the severity of the problem is the fact that approximately 75% of CPAs are eligible to retire.4
All this is to illustrate that there simply aren’t enough accounting professionals to support companies’ ongoing needs. Perhaps as a direct result of this shortage, almost 40% of CFOs worldwide don’t trust the accuracy of their organization’s data.5
So, what does this mean for business owners? In my experience, a shortage of qualified accountants makes it more important than ever to strive for efficiencies across all internal finance functions. Data has no agenda. The first step in shoring up your internal finance function is to conduct a thorough analysis of your current team, technology and processes to identify any potential gaps or inefficiencies.
Following are three tips that can help you identify any pieces that may be missing from your internal finance function.
#1 – Review your current financial functions to identify gaps.
One of the first steps is to review the functions currently performed by your team to make sure you have your bases covered. Your internal financial functions should include each of the following:
- Enterprise resource planning (business management) software
- Analytics
- Budgeting/forecasting
- Controller
- CFO
#2 – Take steps to improve your processes.
It’s important to carefully evaluate each of the functions mentioned above to make sure they’re adding value and adequately supporting your organization. The processes associated with each function have the potential to help or hinder your company’s success, which is why it’s vital to implement strong processes to protect your business and ensure maximum efficiency across all financial functions.
Following are some important questions to consider:
- Are the KPIs timely, relevant and able to help with crucial decisions?
- Do we have processes in place to maximize efficiencies across all these functions?
- Are our people adequately supported by processes and technology so that they can focus their talents on higher-level tasks?
- What processes can we further automate?
- Are we fully leveraging our technological capabilities?
- Are we fully utilizing the talents of all employees?
#3 – Fully leverage technology.
Technology plays a key role in maximizing efficiencies and supporting your employees so that they’re free to focus on more strategic tasks. For example, having the right technology in place allows your team to quickly run analytics, modifying variables to easily generate various budgeting/forecasting scenarios. Without the right technology in place, your employees may need to spend significant time tracking down the relevant data to complete this task.
Another example would be a controller who’s tasked with pricing products and allocating resources. With the right technology in place, they have all the data necessary to quickly identify trends and understand where the market is going. This ability allows the controller to make educated decisions when pricing various products and allocating marketing resources. Ultimately, technology investments into your organization are something that should be providing a strong ROI. In a previous article, I made mention of the amount you should be investing in your back-office finance function to help enable continued growth and sustainability.
