Can AI help make month end less stressful?

Earlier this year, Unit4 conducted a global survey of professional services organisations, and as someone with a long history working in finance one data point stood out. 73% of respondents said reducing the workload of year-end reporting would help prevent burnout among their organisation's finance team, who were struggling with manual processes, system inefficiencies and data integration challenges. That figure rose to 80% in Germany compared to 71% in the UK and US. The pressure around monthly, quarterly and year end reporting has been a constant throughout my career both as an accountant and someone building systems to help finance professionals. If anything, as regulation and market competition has increased, so too has the pressure on the finance team to complete timely, accurate reports. But what if we are now at an inflection point, when technology – in particular artificial intelligence (AI) – could make such reporting dramatically less stressful?

AI as a driver of collaboration

It has always been a goal of finance to aim for no surprises, and with technological advances that goal is becoming more achievable, but at the same time the demands of the business have increased. When spreadsheets first arrived, they offered a way to automate calculations, allowing the finance team to produce analysis and support decisions more quickly but it still demanded a manual review of the output. Financial Planning and Analysis systems have enabled further automation for faster evaluation using bigger data pools. This has intensified the expectations of the business for timely reporting. Also, technology has not overcome the discomfort of the difficult conversations with business unit leaders about anomalies in their results and forecasts.

What if AI could help finance establish a more collaborative approach to month-end reporting that would foster better relations with business unit leaders?

This is no longer the stuff of dreams, because AI is already being integrated into a range of finance processes such as auditing. In the world of FP&A, we are seeing use cases for generative AI (genAI) to collate and summarise information from reports. This is giving back time to the finance team time to focus on gaining insights and making recommendations to the business. That’s real progress. Having produced so many of these month-end reports in my career, I am acutely aware of the frustrations of expending the effort to produce high standard reports that rarely prompted meaningful discussions with the business. What if AI automated the process of pulling the report together, so that the finance team could spend time productively turning insights into actions that help the business?

This does not mean that AI will replace the job of reporting and forecasting. Having investigated the capabilities of various AI tools, it is clear they require human oversight for analytical tasks. It is possible to train them to spot anomalies, but sharing all of the unique characteristics of an organisation with an AI tool is time intensive. How do you explain to an AI that plans may need to be re-written mid-month due to a sudden change in customer behaviour or market conditions? How can you extract the huge institutional knowledge that sits within the finance team that comes from the random moments of serendipity around the water cooler? In time, AI tools will become more sophisticated and capable of much more complex analysis, but today the better use case is in understanding the language in reports, spotting sentiment and summarising information in a meaningful way.

Putting the right foundations in place

It’s a big step forward to be able to reduce the non value-add elements of the monthly hamster wheel. But to get there does require solid foundations which starts with ensuring you have a single source of the truth. This, in itself, is challenging especially if you are operating disparate, legacy finance systems and/or disjointed spreadsheets. Modernising and integrating these systems is critical for a seamless data foundation that allows the FP&A application to draw information from the whole business.

Think about the real but unpredictable impact of all sorts of black swan events that can and do impact any organisation. Whether it be overseas crises, a ransomware attack, Covid or some other unexpected and unknowable event that utterly disrupts the value chain. It’s no understatement to say that this could present an existential crisis, so having a complete picture of cashflow, revenue and forecasts is critical to meaningful decision making. That can only happen if you have all the information available.

However, what is at least equally, if not more important, is how finance teams learn to use the outputs from AI-enabled reporting. Trust is the biggest priority for any finance team. Do they have confidence in the numbers that are being shared by the AI? And more importantly, is finance seen as a trusted advisor to the business? Even with AI, the fundamentals remain the same. Can you spot the soft numbers? Can you guard against surprises? Can you succinctly explain what the numbers are telling you? This will require FP&A teams to build up skills in prompt engineering and look at how they can build Agents and frameworks for Agents so that they operate in an ethical, reliable way. They will also need to work closely with governance and data security teams to ensure these tools operate in safe curated environments that are not vulnerable to outside interference.

The key is to increase the collaboration with business unit leads so they understand how the finance team is deploying AI tools to help the business reach better decisions. This will require negotiation and communications skills, but if finance works in partnership then it will lead to shared accountability. If finance can get their colleagues to buy into this vision for AI, it will not only alleviate stress, but make for a more productive, positive relationship around month-end reporting.

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About Bob Elliott CGMA/ACMA

Bob has spent his whole career in finance, earning his stripes in commercial finance before moving into the world of FP&A software applications in the late 1990s. He has worked in a variety of roles in that space ever since, inter alia, implementation consultant, solution architect, project manager, and business manager. Having dealt with thousands of prospects and clients across most vertical markets he is in a unique position to reflect on the seismic events affecting this space.

About Unit4

Unit4's next-generation enterprise resource planning (ERP) solutions power many of the world's mid-market organizations, bringing together the capabilities of Financials, Procurement, Project Management, HR, and FP&A to share real-time information, and deliver greater insights to help organizations become more effective. By combining our mid-market expertise with a relentless focus on people, we've built flexible solutions to meet customers’ unique and changing needs. Unit4 serves more than 4,700 customers globally across a number of sectors including professional services, nonprofit and public sector, with customers including Southampton City Council, Metro Vancouver, Buro Happold, Devoteam, Save the Children International, Global Green Growth Institute and Oxfam America. For further information visit www.unit4.com.

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