To say the last financial year was a busy and challenging one for finance leaders and their teams is a serious understatement. As businesses raced to respond to the COVID-19 crisis and the economic whammy that came hot on its heels, finance professionals were in the thick of it: adjusting forecasts on the fly; implementing cost-cutting measures; liaising with creditors and debtors and keeping the accounts up to date — all the while working remotely.
Twelve months on, circumstances are looking decidedly more optimistic. While Australia's borders remain largely sealed, the economy is roaring back to life. 2020's steep decline in GDP — down by a record 7% in the June 2020 quarter — has been replaced by growth of 1.8% in the March 2021 quarter, and the nation's economic output is 0.8% greater than it's ever been.
Businesses that last year were laying employees off en masse, or furloughing them on the JobKeeper payment, are back in the hiring game and headlines are now focused on skills shortages rather than round-the-block Centrelink queues.
In New Zealand, gross domestic product rose 1.6% in the three months through to March, with economic growth being fuelled by a housing boom and robust retail spending. Annual GDP is up 2.4%.
ANZ Bank chief economist Sharon Zollner says, “Q1 data confirm NZ's economic recovery has been spectacular relative to early-pandemic expectations. And while there are still pockets of weakness, they are getting hard to identify at the aggregate level.”
Taking a strategic step forward
For many finance teams, this welcome reversal of fortune means they're able to move out of survival mode and start thinking strategically. The dawn of a new financial year represents an opportune moment to examine current processes and practices, to determine whether they could — and should — be overhauled or optimised.
For enterprises that continue to operate with legacy financial software, the question of whether it's time to upgrade to a cloud accounting platform is likely to be high on the agenda.
The advantages of doing so were amply demonstrated during the COVID-19 crisis. Organisations that had already made the shift found sending finance employees home to work a considerably easier proposition than those whose operations depended on an on-premises solution.
A BlackLine survey of finance leaders conducted during 2020 illustrated the extent of the problem. More than a third of respondents had difficulty accessing their on-premises solutions, while 46% stated their operations were disrupted by their inability to complete manual tasks in the office. Meanwhile, 41% struggled to share paper documents.
In the wake of that experience, the case for migrating to a cloud platform that finance employees can access safely from anywhere is both cogent and urgent.
From repetition to automation
Carrying out repetitive accounting tasks manually is a labour-intensive business. As well as being expensive, the process is vulnerable to human error and represents a sub-optimal use of trained employees.
Robotic process automation (RPA) reduces or eliminates many routine tasks that collectively comprise the accounting function. Transactions and figures are processed and updated continually throughout the accounting period, rather than in a batch, at month or period end. The software's machine learning capabilities allow it to literally ‘get smarter' over time by applying business rules to high volume tasks and predicting future matches.
Thus, migrating to an automated accounting model can deliver significant efficiencies and cost savings, along with an enhanced insight into the organisation's financial position in the here and now, not months down the track, when the books are closed off.
By eliminating manual systems and processes, an intelligent accounts receivable solution can provide finance departments with a comprehensive, up-to-date view of their cash position at the moment of need and not when everything has been reconciled.
For businesses looking to optimise their operations as they recover from the COVID-19 knock, automation represents an unparalleled opportunity to boost productivity and achieve additional value through the strategic use of technology.
Approaching the future with confidence
Having helped to steer their organisations through a period of unprecedented uncertainty, finance leaders and their teams face a new challenge in FY2022 — supporting their employers to tackle the opportunities the post-COVID-19 economy is generating.
By optimising the finance function, they'll be better equipped to do so. For finance departments that have yet to embrace automation and cloud technology, the next 12 months promise to be busy ones.