Creating Value Out Of Effective Accounting Information Communication

DeryckJaum

Lifestyle News

Jan 23, 2019

Effective and efficient communication of essential data positions accountants as influential key players in several areas such as organizations and businesses. What do businesses really want from new college graduates these days? It seems that the highlight is no longer on the technical skills they learned during their college career but on the soft skills. “Soft skills” for this purpose means the ability to think significantly and to communicate at the C-suite level.

I believe that today, trade of accountants is the accumulation, analysis, and projection of data into key information for decision makers. After which, translating that information to communicate effectively with stakeholders. Accountants can identify imminent problems and perhaps are able to suggest solutions in a more objective manner.

The real test then is how well the problem and solution are communicated to those who are best able to take any required action. That’s the accountant’s opportunity to develop leadership skills. Leaders are communicators. Communicators are leaders. Poor communicators can’t last long in leadership positions while the effective ones will never be out of leadership posts.

If we think about the people we admire, we often think of them as leaders. Those who are technically adept and capable of communicating critical information in a timely manner and accurately will generally strike us because they are the go-to people in the group or company.

Accounting and finance professionals will need enhanced communication skills in order to better understand managers’ changing information needs and their key performance metrics. They must be able to help managers understand the information provided by analytical models, by translating analysis into a format valuable for business decisions. Working together with others on an interdisciplinary team will help enable accounting and finance professionals to uncover opportunities and create value.

A significant accounting communication that companies need, since then, is the performance reporting. This is used to quickly give companies a real picture of where they are, why they’re there, and how they can get where they want to be. A fundamental example of this reporting is segment or per branch reporting. Unfortunately, finding that story can be a time-consuming, painstaking process.

Undeniably, a common complaint from executive offices is that it’s nearly impossible to find a single, accurate picture of their business. That’s true for most companies because normally:

  • Profit and loss statements don’t speak to the balance sheet.
  • Cash flow analyses don’t interact with customer profitability reports, sales and marketing budgets.
  • Financial statements don’t necessary inform plans for future or years.
  • Operational data lives in a world of its own.

Understanding continuous narrative – why things work or don’t work – is vital to success. Business operations without these facts into key performance metrics are essentially running blind. By the time they discover a missed target it’s too late to recover.

Most organizations will find that performance reporting is highly effective at finding and sharing the story in the numbers and enabling leaders to make smarter decisions to benefit their customers, employees, and other stakeholders. This is where the GDFI team is investing, to take advantage of the benefits it gives in terms of bottom line figures and to its operations as a whole.

To name a few, performance reporting systems offer many benefits:

  • They significantly speed up planning, budgeting, analysis, and reporting.
  • They create a greater understanding of performance by segments in time to make adjustments that will influence outcomes.
  • They enable greater transparency, and more effective action and promote trust between accounting and other departments, all while reducing pain, frustration, and uncertainty.

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