Accounting professionals are being pressured to deliver more value and intelligence to their business clients every day. The pressure comes from a variety of areas, not the least of which is the fact that a lot of do-it-yourself tools are now available which lead business owners and managers to believe that they know what’s going on in the business. Lots of charts, graphs, and dashboard presentations make the numbers more readable, but they don’t say whether or not the numbers are even right. Even more important, they don’t deliver insight based on experience and understanding. This is where the accounting professional’s value really comes from – providing insight based on good data and quality data analysis backed by experience and understanding of the business.
Knowing what makes a business valuable is important, but what many business owners don’t fully understand is how to best increase that value. Generalized reports which summarize financial information, distilling it into a standard set of metrics, often don’t tell the business owner what they really need to know – how to go about increasing the overall value of their business, whether it is through improved profitability or through growth.
The business owner understands the operations, but not necessarily how operational activities actually impact value and profitability. Helping owners know more about their enterprises requires that the accounting professional also know more, where gaining a deep understanding of operations and learning what business functions are addressed and how becomes the key to bridging the gap between operational knowledge and business valuation. This is where the accounting professional or CFO can really make a difference, and can help to apply their knowledge in building business value directly towards those areas which fundamentally impact it.
- Read more about how accountants need business intelligence, too
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- Read more about Data Warriors: accounting in the cloud