This Deep Dive Live session was with Generation CFO, Certent and LV=.
In times of uncertainty, internal and external reporting are vitally important to ensure trust and confidence. It is not only the information we provide, but also the efficiency and control over the process that is important.
In this interactive Deep Dive Live, we looked at how LV=, one of the United Kingdom’s largest insurance companies, has been able to meet reporting challenges. GenCFO was joined by Andy Young, Finance Systems and Change Director at LV= and Mark Rolfe, Certent to discuss a range of topics:
1 minute summary
“The role of technology is fundamental to the finance team and the roles within in it. Technology needs to be embraced, particularly in the current climate as we navigate the crisis. The digital agenda is now more important than ever”.Mark Cracknell, Head of Research, Generation CFO
Here is the full video recording
We covered the following key topics:
- What does reporting excellence look like?
- What challenges did they face?
- What extra challenges have the current circumstances posed?
- How did they turn a compliance cost into an investment with business benefits?
- What is the role of technology in reporting excellence?
Charts and Graphics
Typical reporting processes
Reporting is fundamental to gaining the trust of internal and external stakeholders. Investors, lenders, suppliers and customers are all looking for information to give them confidence in your organisation. Internally, employees want information in order to understand what has happened in the past and to formulate plans for the future. They also have a personal interest in the financial wellbeing of the organisation. In times of uncertainty, reporting is even more important.
We still find that most report packs are created using a combination of the Microsoft Office tools (Word, Excel, PowerPoint). This is a laborious process with a high level of manual intervention introducing the potential for human error.
Catalyst to change reporting.
The original LV= approach to reporting was typical of this; data extracted from the general ledger into Excel, manipulation and then copied to Word. The final step was sending this to a printer to produce the glossy financial report. This was time consuming and subject to year-end time pressures.
Rebranding in 2006 saw a change in direction for LV=. With this rebrand, there was more pressure to produce high standard reporting excellence. Getting things right first time, and reducing risk of error, was paramount.
Ernst & Young were retained to review and identify weaknesses in the reporting process. Issues were identified, particularly around processes, sources and conflicting data; a report may have come from several “nearly true” sources.
“Historic processes meant that this was how things were done, but the processes were never changed. There wasn’t much around at the time to show how it could be done differently. It was very much like the slide (below) but things had to be forced to change”. Andy Young, ACA, Finance Systems and Change Director, LV=.
Things had to change, so Certent was brought in.
Now, data updates automatically in Word, Excel and PowerPoint. Various different data sources are consolidated from different Microsoft Office tools to build the reports. No manual intervention is needed reducing the risk of error.
Mark Rolfe, Certent, commented that more recently, a range of changes were being seen in financial reporting but there remains a resilience towards bringing in the technology needed for the finance team to aid reporting. “We see things are changing and this is also driving a change in focus”, Mark said.
There is also now an increasing focus on “best breed” to find reporting solutions. Previously, contained solutions replaced an entire process but now, partly because cloud is a far more commonly accepted media, it can be easier to find a solution to a niche area which leverages on what you already have.
Turning compliance into a business benefit
Compliance has traditionally been seen as a cost but not as a business benefit. We recently published an article on this subject – read it here.
Andy Young stressed that the cost of compliance is easy to identify, however the benefits are more difficult. may be more difficult.
LV= was fortunate to have a focus on control and “getting things right”, particularly through their period of growth and when change and investment was taking place. The costs in investing in regulations and compliance, was fundamental and can be surprising, however, it is a beneficial gain. The solution has minimised risk and also sped up reporting processes, reduced manual interaction, and increased certainty. It meant that people were diverted away from accepted month-end slog of long days and resulted in a more even workload.
Mark Rolfe commented that a lot of companies may make the choice to outsource their compliance, which is costly but pointed out that investment can give increased confidence in the decision making practices can be closer to home.
Want to discover how Certent helped LV= achieve reporting excellent? You can read more about this success story here. You can also check out what they can do to help your business achieve better financial reporting.
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