Today’s CFO is under increasing pressure to provide timely insights to facilitate informed decisions across the enterprise. CEOs, heads of front office, CIOs and COOs are beginning to demand quicker, more reliable financial insights and it is vital for a CFO to have the right information at the right time to react quickly to rapidly changing market conditions.

The role is often made harder with a lack of dedicated IT support and legacy software systems that are not set up for finance’s needs. Expensive, talented individuals spend most of their days on mundane manual tasks such as collecting, consolidating and validating data. And despite their best efforts, shadow finance functions routinely challenge the numbers with the CFO only semi confident on data accuracy and reliability.

The majority of wealth management CFOs say that achieving a single version of the truth is a high priority.

The modern role of the CFO
A recent Deloitte report called ‘Finance 2025’ identified key trends, with predictions of a much more data focused, real time and forward-thinking vision of finance. Furthermore, common tasks such as data aggregation, routine journals and manual reconciliations that currently take up the majority of time will be replaced using streamlined tools and robotic process automation. Finance teams will not become redundant but will change and evolve into strategic analysts and strategic decision-makers feeding into the decisionmaking process.

Understanding and mastering the power of data is central to the change process and the CFO function is uniquely positioned to drive this forward. Traditional values of integrity and a control  focused mindset link seamlessly with longer term strategic thinking.

How does this apply to wealth management?
Moving away from spreadsheets or implementing a new general ledger are admirable achievements, but neither process is likely to provide the level of insight needed for the CFO to meet the growing demands expected of the finance team. Without an analytics-driven finance function, one-off requests take time to understand, prepare and report back by which time the strategic agenda may have moved on. Implementing a self-service analytics or business intelligence tool will provide an immediate response, safe in the knowledge that it ties to the core financials or other central data sets of the firm.

Taking an example of fee rates, larger wealth managers may have many hundreds of rate cards spread across multiple systems. A problem often compounded by investment managers amending fees during the billing cycle for commercial reasons. How many wealth finance functions have a true grasp of rate cards and how they drive income? With a well-structured data set that integrates AUM and income, CFOs can understand the income generated for every client and every portfolio. Anomalies can be identified, whilst strategic pricing decisions can be better informed with real time scenario and what-if analysis.

Furthermore, CFOs can no longer run separate AUM reporting streams from their core financials. Data structures must not just be aligned but shared in real time. Introduce a new service category in AUM and it needs to be automatically picked up for financial reporting, budgeting and forecasting purposes.

Other benefits
A finance driven data and reporting transformation will bring about a series of other quick wins along the way. Month end reporting becomes much more automated, with AUM and financials available as soon as the upstream data is provided. Our experience has shown that consolidated AUM and income reports can be produced on working day one, even allowing for accuracy and completeness checks. AUM reporting can be performed more frequently as required.

Accuracy is improved with a significant reduction in risky manual effort and a full audit trail from source system. Qualified accountants can spend time understanding the business, understanding the numbers and providing the valuable insights that the business requires.

Transformation roadmap
The latest research from The Hackett Group finds that companies can cut finance costs by over 40% through comprehensive digital transformation and technology optimization. All of which asks what is it that’s holding finance teams back, when comprehensive digital transformation can deliver such impressive gains? Perhaps the biggest issue is that finance teams simply don’t know where to start.

Step one is to assess the current state of your organization’s data. Not only by looking for missing or incorrect data, but by understanding the myriad of data providers in your organization and seeking out the golden source of the truth.

Step two is to look for a solution to address known concerns and progress the function towards the vision. This is where FinanceBI steps in, with pre-built solutions for finance functions that force data cleansing, automate reporting and achieve a single version of the truth.

With the amount of data available set to increase year on year, CFOs and other finance leaders must embrace the change and leverage the right technology and skill sets. The ones that do will reap the benefits of an empowered workforce more closely aligned to the business objectives. competitive advantage is ensured.

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This article originally appeared in The Wealth Mosaic's 2020 Swiss Wealth Technology Landscape Report. Click here to access and download this report: https://docsend.com/view/2b56ksz