Institute of Management Accountants: Overcoming FP&A’s Biggest Challenge: Predicting the Future

The Institute of Management Accountants released a report that “is designed to serve as a guide for organizations trying to forecast what’s ahead in their markets”. It poses and expands on these 9 ways to improve forecasting in the future:

1. Expand the data available
2. Tools: Start small and add on
3. Use scenario planning
4. Address the knowing-doing gap
5. Model Building: Think causality
6. Establish data collection systems
7. Improve assumptions and estimates
8. Monitor results and quickly identify the business reasons behind variance
9. Improve analytical skills

Read More at Institute of Management Accountants >

CFO Dive: Driver-Based Budgeting Touted for Integrating Financial and Operational Planning

“Driver-based budgeting links real resources and activities to your budget, and most FP&A organizations are striving to achieve that. From my perspective, it really acknowledges that the budget is the articulation of a series of operational items or activities. It’s different from traditional budgeting in that it shifts the focus to outcomes, and that’s ultimately how you drive your annual budget.”

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CFO Dive: Making FP&A Analysts the CFO’s Braintrust

“The goal is to identify levers in each function area that drives that part of the organization’s overall success, put a dollar amount to the levers so leadership can know how much spend will result in how much improved performance, and then course-correct as the metrics rise or fall.”

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CFO Dive: 5 CFO Tips for Rebuilding FP&A from Pandemic Ruin

““COVID-19 changed the future direction for most companies and so FP&A — and especially forecasting the future — became much more important””.

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Accounting Today: Now What? Bridge the Gap in Financial Planning and Analysis

“Transformation is no longer just “nice to have.” Business leaders must be able to rely on the validity, trustworthiness and relevance of the data used to analyze and report on end-to-end planning, budgeting and forecasting processes. The cost of continuing business as usual is duplication of the efforts, fragmented systems that take lots of people and time to reconcile, challenges to meeting regulatory compliance, an inability to determine where to prioritize resources, and lower stakeholder confidence.”

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CFO Dive: Making FP&A More Business Relevant

“..The goal is simple: to arm CFOs with more relevant and actionable analyses so they can be better partners to the other executives.”

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CFO Journal: CFOs Target FP&A, Analytics for Improvement

“Among core finance functions, 63% of CFOs cited FP&A as the one they would most like to improve. Perhaps because of the increased demand on FP&A teams during the pandemic—from providing robust scenario modeling to monitoring and maximizing key priorities such as cash flow and liquidity—CFOs may have gained a clearer vision of how they’d like to reinvent FP&A.”

Read More at Wall Street Journal >

CFO Magazine: CFOs Want FP&A to Marshal Value Creation

“FP&A should spend less time explaining the numbers, they say, and more time working with the business to manage them. As one finance executive told us, “I need an operating thought partner and not someone that is just keeping score.””

Read More at CFO Magazine >

CFO Magazine: CFOs Want FP&A to Marshal Value Creation

“FP&A should spend less time explaining the numbers, they say, and more time working with the business to manage them. As one finance executive told us, “I need an operating thought partner and not someone that is just keeping score.””

Read More at CFO Magazine >