PR Newswire
44 hours per week wasted on financial discrepancies and two days per week on year-end financials
Unit4, a leader in enterprise cloud applications for people-centric organizations, has unveiled part two of its international research study, “The Back Office in 2025.” Conducted by Vanson Bourne, it highlights major difficulties for professional services firms in managing key financial systems, such as cash flow management, year-end financials and project financials. 100% of senior finance and IT decision makers experience discrepancies in year-end financials, with the majority (77%) saying they occur often. Significant resources are being wasted in investigating errors, consolidating financial information and on manual processes. Data consolidation, back-office integration and automation are seen as key to improving performance.
Year-end discrepancies affecting morale
There is a clear human cost to financial errors, as 61% say year-end reporting negatively impacts the wellbeing of the finance team, while a further 73% say reducing workload at year-end would help prevent burnout. The top three challenges related to discrepancies are:
- Time-consuming manual processes
- Lack of integration across systems
- Difficulty consolidating financial accounts
“At a time when productivity and efficiency are bywords for every Professional Services firm, these findings reveal concerning shortcomings for organizations that want to be more competitive,” said Bryce Wolf, Strategic Growth Director, Unit4. “The firms that drive greater consolidation of financial information will be closer to gaining a single source of truth about their business performance. Combined with greater automation to aid faster decision-making, this will be critical to survival and growth in the years ahead.”
Project financials are draining resources
Project financials, as well as year-end reporting, are adding to the burden. When dealing with year-end preparations, senior finance decision makers are spending two full working days per week consolidating year-end financials, while respondents say they are wasting 25 hours a week investigating project financials and 19 hours per week on correcting or updating issues.
Read More: Why the Payments Industry is Facing Its Biggest Transformation in a Decade
The top three challenges for improving project financials are:
- High costs of new solutions
- Lack of real-time financial data insights
- Fragmented and inconsistent data
Slow and risky manual processes are to blame
A possible cause for discrepancies and wasted time could be that 84% of finance teams are spending too much time on manual processes that should be automated. In cash flow management the top three processes affected by this are payment reconciliation, approving workflows and data consolidation and integration. It is no surprise, then, that 88% say cashflow management is difficult, blaming inadequate financial reporting tools, complex approval processes and high operating costs. In turn, this is leading to increased processing times, operational costs and risk of errors.
Globally respondents see real value in automating financial processes, saying the top three benefits will be:
- Tracking and managing project expenses – 48%
- Cash monitoring and optimization – 47%
- Creating financial forecasts – 47%
Today, though, only 46% of cash flow management processes are automated. Among the subsectors within Professional Services, Management consulting (49%) comes out top in wanting to increase automation, followed by IT and tech (48%) and Media and publishing (46%). Similarly, 92% of respondents agree that automating processes would speed up consolidation of year-end financials. Generally, there is agreement that consolidating data, greater integration of back-office systems and automating processes should be prioritized to overcome the challenges outlined in the research. Embracing AI and automating manual workflows can provide a single source of truth for financial data – something that is lacking for 73%.
Globally, respondents also say that finance systems could be improved with:
- AI-enhanced features (93%)
- Integration of financial management tools within an ERP system to improve collaboration and decision making (92%)
- Third party partnerships to optimize cash flow management processes (90%)
Respondents believe that adopting these recommendations will help to improve the accuracy of financial decision making, reduce workloads and ultimately free up teams to focus on strategic growth.
Read More: Global Fintech Interview with Beth McCoy, President of RewardOps
[To share your insights with us, please write to psen@itechseries.com ]
