Ever noticed a correlation between high profile “accounting errors” and the reality of a firm’s financial performance? Cake Box recently lost almost a fifth of its market value after “inconsistencies” in its annual report were spotted by a blogger, including an alleged £2m false entry.
The revelations shine a spotlight on governance frameworks for financial reporting.
The reality is that for most firms faced with the arduous task of compiling these reports, errors come from highly inefficient methods in developing the reports, not from trying to falsify the books.
This is why more firms should be looking at the repetitive, albeit necessary tasks such as reporting on company financials, that can be automated.
With the pain point often being around the accessibility and quality of data, it has to be worth streamlining the process for compiling these reports with automation technology.
Firms need to focus on ensuring year-end financials are based on clear and reliable data, as only then will they be able to spend more time on devising strategies that will maximise long term performance for shareholders instead of wasting too much time on reporting.