The Needs of the Modern CFO: Security, Compliance, and Auditability

The role of the CFO is broadening dramatically. Over the years, financial leaders have shouldered core responsibilities of financial reporting, audit and compliance, planning, treasury, and capital structure; in today’s business climate, they’re stepping into the prominent role in corporate portfolio management and allocation. A modern CFO is expected to take its place as a trusted advisor to the leadership team.

Through the implementation of ERP systems and related business applications, CFOs can increase productivity within their teams and organizations as a whole. Innovation is changing the business climate, giving those who manage finances the opportunity to utilize existing technologies to meet audit and compliance requirements, communicate important information to the rest of the C-Suite, and meet the company’s growth targets and other strategic goals.

Security is critical — according to a KPMG survey, 75% of executives plan to allocate 3 to 10% of the total cost of a future cloud ERP implementation to ensuring data safeguards.

Managing the Compliance Program

Compliance within a company is the responsibility of its CFO; they must have the appropriate infrastructure in place to provide IT, HR, and other C-level executives with the tools they need to meet requirements and still perform traditional duties as expected.

ERP systems help CFOs achieve company-wide compliance, as they are equipped to handle accounting policies and procedures, provide role-based security for all users, and generate audit trails of transactions. These internal controls help companies to mitigate risks due to legal action, financial loss, and damage to their brand/reputation.

The role of a CFO can be demanding, and an ERP system can help them stay ahead of the curve. Cloud-based systems feature automatic updates that help companies stay on top of technology, as well as professional standards. Alleviating issues that can arise from changing laws, rules, and statutes.

Additionally, implementing an ERP system helps finance teams to sidestep compliance costs thanks to improved accuracy and efficiency. Data entry errors can prove costly to businesses; streamlining internal processes through an ERP system can aid employees in the prevention of making a mistake that can hit the company with fines and penalties that often reach thousands of dollars.

Increasing Auditability

Internal processes are paramount, but a company’s leadership is also responsible for providing external auditors with the requested data and information they need. Here are some tips to ensure the highest expectations are met:

1. Invest in your ERP System: Complete and organized financial records are essential. Keeping the organization’s ERP up to date with modern technology helps to record and optimize data, providing actionable information with drill-downs to the transaction level. A cloud-based system lets staff access what they need from anywhere, at any time.
2. Automate Routine Manual Tasks: Eliminating manual data entry reduces errors. Automation, conversely, enforces authority that leads to regulatory compliance — a complete audit trail provides useful insights.
3. Partner with Other Executives: Audits impact virtually everyone in the business. The CFO is the conduit, maintaining an active dialogue with department heads. An ERP helps the financial leader share information through the common platform, eliminating one-on-one touchpoints that can take a lot of time.
4. Provide Insightful Forecasts: Advanced technology makes it easier for companies to comply with regulations. With more and more businesses implementing modern ERP systems, auditors have come to expect a higher standard of reporting. CFOs now rely on business intelligence tools that provide accurate forward-looking performance — the data ERPs provide also helps to identify factors that cause the most headaches.
5. Manage Risk Effectively: Risk comes in many forms throughout an organization; it’s unrealistic to think every issue comes from financial risk or regulatory compliance. An ERP gives a broader view across the enterprise, which can identify areas that require attention before significant problems arise. Audits are faster and more accurate, thanks to automation.

Keeping Data Secure

The CFO is responsible for protecting a company’s financial and other sensitive data. Often the target of cyber-attacks, an organization must safeguard its confidential information. Understanding where gaps lie can keep companies safe. Breaches that target bank access, customer data, or intellectual property can impact budget and create long-term issues for the business, including forcing a company into redundancy.

Identify the areas that pose the biggest threats:

• Access to sensitive data (from areas such as banking, HR, or ERP)
• Access to sensitive reports
• BYOD and mobile devices
• Phishing attacks

Realize the consequences of a security breach:

• Financial loss
• Legal implications
• Damage to company reputation
• Loss of intellectual property

Reduce Risks with an ERP System

The best way to mitigate risk is to implement a cloud-based ERP system; developing a company-wide security program with engaged employees — who are educated on the system and given appropriate rights and permissions — will help keep data secure.

To learn more about streamlining, automating, or improving operations with modern software, contact us.