Embracing Technology - Digitalization : Accounting Vs Treasury

While accounting departments are still at the beginning of their digitalization journey, which means that the biggest challenge is the adequate training of human capital and the standardization of system landscapes, treasury departments already seem a step further ahead. Treasury departments already show a high degree of digitalization and treasury employees are generally well-trained through their use of system-based decision criteria on a daily basis, which is why treasury departments currently hope to streamline their processes by making the use of management-by-exception and automated processes the new normal.

Current priorities in accounting departments

At this point, accounting departments are dealing mostly with technical homogeneity. Both the homogeneity in the systems used in accounting as well as the creation of a standardized data basis with which the accounting and controlling departments work have the highest priority because this lays the foundation for further digitalization steps.

In accounting, right now there is also a focus on the standardization of workflows as well as the quality of master data.

Accounting managers have also realized that they have to reinvent the roles of employees and that employees have to have another kind of knowledge and characteristics than before the age of digitalization. As such, an understanding of processes, an IT affinity as well as knowledge on data analysis are currently what accounting and controlling employees should be focusing on.

Digitalization as an advantage

The respondents in KPMG study see the increase in efficiency and transparency as a significant advantage of digitalization.

In accounting, it is possible to augment efficiency by heavily automating many activities, such as the operational accounting, which consists of many transaction-based and standardized processes. What’s of significance here is the automated recording of business transactions using system-based and self-learning analyses of invoices and account statements in MT940 formats.

Benchmarking digitalization

When looking at current developments in accounting, it quickly becomes evident that much of what they see as new is already well-implemented in treasury departments. Specifically the level of digitalization, measured by the degree of implementation of treasury management systems, was already rather high in previous years. This level could even be increased; certain studies even show that 80% of all respondents have a full or partial treasury management system, which is extremely high.

In KPMG’s study on digitalization in accounting departments only about a quarter of all respondents implemented a paper-less accounting as expression of a digital initiative. In comparison, corporate treasury departments consider the electronic Bank Account Management (eBAM) in order to digitalize this process as standard, thus making it paperless. Accounting respondents also mention the automated recording of bank account statements in the MT940 format as well as the payment-invoice matching as important developments in accounting. Treasuries have already been accessing bank account statements electronically for quite some time. Matching is another area where treasury is already automated – be it for external payments or for the system-based settling of transactions and their confirmation by the bank.

How technology will change the role of finance team

Whether or not technology will change your role is no longer in question. It’s a fact. And you don’t have to wait and see how it will change. Being proactive about honing your skillset and mindset can equip you to create your new role based on your strengths as an accountant and the tasks that energize you.

We so often view change as something that happens to us, pulling us out of our comfort zones and stripping away all familiarity. But viewing change as something that is happening for us gives us an entirely new perspective and keeps us open to all the opportunities that are in store.

CFOs were once focused solely on the company’s finances. Today, technology is enabling CFOs to become greater strategic partners to the entire business, with growing ownership for all levels of risk management.

Future-focused CFOs can now become change agents, leading with automation and analytics, and being a data-driven “sponsor” for strategic decisions.

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