THE FUTURE FINANCE FUNCTION: ARE WE READY?

27 Apr 2020

It is probably safe to say that finance function has evolved overtime. The role of CFOs is expanding beyond traditional finance function to encompass other areas such as strategy, enterprise risk management, performance management, and communication (Dancey 2019). The International Federation of Accountants (IFAC, 2019) identified six essential deliverables of future finance function:

  1. Actionable insights – creating and protecting value
  2. Performance analysis – aligning between strategy, planning, delivery
  3. Enterprise risk management – addressing significant challenges in external environment
  4. Effective communication and storytelling – communicating compelling narratives for external audiences
  5. Trust and confidence – managing governance, data, process, systems and reporting
  6. Integrity and professionalism – adhering to code of ethics

As a means of providing a guideline, IFAC (2019) has developed a tool for organizations to self-evaluate the current state of their finance functions. This tool consists of 16 statements in which organizations need to rate their level of agreements on a scale of 1-5 for each statement. This checklist can serve as a preliminary assessment of the organization’s finance function and how it can be developed and transformed into future finance function. The assessment tool can be accessed here.

 

Sources:

Dancey, K. 2019. 6 Essential Deliverables for the Finance Function of the Future. IFAC Knowledge Getaway

IFAC. 2019. Evaluating the Finance Function: An Assessment Tool to Guide Finance Function Transformation

 

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