Elevate Your Financial Reporting Part 3: Practical Steps to Improve Your Reporting

In the final part of this series, we look in detail at the pragmatic steps that will help you improve the quality of reporting in your organisation

I highlighted several reporting challenges earlier in this series. Not all are within the full control of finance – data, for example. However, others are controllable, if not highly influenceable, by the finance team. If you can address these successfully, the quality of your reporting can improve significantly.

Turning data into information

If ever there was a subject that the finance team needs to get right, this is it. I still see reports that contain only numbers. Data does not become information until we apply meaning and context, often in the form of adding an accompanying narrative.

This ability to tell a story is a critical skill that the modern finance team needs to master. We need this to deliver insight and add the value that raises our profile from mere beancounters to strategists. If you are adopting a ‘business partner’ approach, this process is particularly fundamental; it demonstrates our ability to create action out of data.

Means of communication

So far, I have referred to reports and reporting. For completeness, let’s include other methods of business communications, such as presentations.

The content of communications has changed in recent years with graphics becoming increasingly popular. The methodology has also developed from static consumption of a hard or soft copy report to dynamic self-service analysis using analytic applications.

Many finance teams still adopt a classic presentation style, consisting predominantly of numbers and narrative, delivered in a static format. Whether the report creator (finance teams can now easily create visualisations using tools under their control) or consumer drives this change is a matter for debate.

Static reporting may be mandatory for certain types of reporting (e.g. regulatory or statutory reports). For other communications, we have a choice. Evaluate the impact that the deployment method has on your finance team. With static delivery, the finance team is likely to consume more valuable time providing report variations or further analysis.

The ideal solution is to develop dynamic report communication, probably through a web-browser, allowing consumer self-service. Of course, this should include the finance-driven narrative where applicable.

While the advantages of data visualisations are plain to see, we need to address a risk. That risk is how to determine the appropriate visualisation to tell our story. Visualisations are not there for aesthetic purposes. They help the consumer to identify issues and required actions, which brings us nicely to the third controllable factor.

Consistent design standards

We can significantly enhance the understanding of reports and presentations by applying consistent design standards. In my experience, very few organisations are consistent across a single report, let alone all communications.

There are several areas to consider. The first is how we use the medium for reporting. For hard-copy reports, what’s the page size? When using an analytical tool, how do we use the space (screen real estate)?

The next is developing standards for how we communicate information. If we’re to use a visualisation, which one and where?

The final point is where the detail lies: how we structure a report. What do you assign to rows and columns? Are the titles and labels correct? How do you display comments and use colours? What scale do you use?

These may all seem minor points, but when time is precious, and it is critical to identify the issues that require action, we should use every tool to achieve this objective.

The principle of standardisation has been adopted by notable organisations within mainland Europe but has yet to gain traction in the UK. To give you an indication of how we can apply this in practice, I would recommend looking up the International Business Communications Standards Institute (IBCS).

Overcoming the barriers to change

When reporting and communicating with the rest of the business, we have multiple parties with a vested interest. This, unfortunately, can create barriers to change that we need to overcome.

A reluctance for the consumer to change is a common issue. They may be comfortable with what they have, or they fear change. It could be a combination of both. Produce alternative reports and communications and seek feedback from consumers as a possible solution. It may mean extra workload in the short-term, but hopefully less in the future.

You may also encounter resistance from the marketing team if you communicate with external consumers through annual reports, for example. They may be insistent on a marketing style, putting substance over form for aesthetic purposes.

You also need the right technology and skills you need the follow the path you want to take. Technology speaks for itself. However, the user skillset changes as you move from productivity prowess to analytical mindsets.

In all cases, the CFO and the finance team should use their influencing skills to achieve the outcome that is right for the organisation. The good thing about improving reporting is that change can be delivered quickly and on a tight budget.



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Christopher Argent, Founder, GENCFO

Chris is the founder and MD of GenerationCFO.com and creator of the Digital Finance Function Model and a contributor to many articles on our platform. Chris focuses on the shift toward digital transformation in accounting and finance, shows you what good looks like, then helps to get you there!

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