The majority of companies surveyed worldwide have made substantial investments in financial reporting systems intended to improve their close, reporting and filing processes.  However, the investments have been made ad hoc, leaving businesses with ineffective solutions and a lack of visibility, quality and confidence in their financial data.

The research report, 'Challenges of Corporate Financial Reporting,' highlights that businesses are unable to fully understand the cost of their financial reporting, with 60 percent of finance professionals unable to identify the total cost. 

Conducted by Accenture and Oracle, the report suggests that businesses need to change their investment strategies in order to avoid increased costs, ineffective financial reporting and missed key internal and external deadlines.

The report, which included 1,123 finance professionals working in 12 countries, found that 82 percent of surveyed companies have made changes over the last three years to their close, filing and reporting processes.

Forty-seven percent have invested substantially in at least one of these three areas in the last 12 months. A quarter have invested in all three areas, 10 percent in two areas and 12 percent in just one.

Despite these investments, more than two-thirds of the companies still use spreadsheets (72 percent) and emails (68 percent) to track and manage reporting on a daily basis, suggesting that new investments are falling short of expectations.

Consequently, 21 percent of surveyed companies have seen costs rise across the close, reporting and filing processes and 60 ercent said they did not know the total cost of managing and publicising their company’s financial results.

In other problems associated with the reporting systems, which the finance executives reported:  more than two-thirds (68 percent) said they had inadequate visibility of their reporting processes, while 84 percent reported that they find it difficult to control the quality of their financial data across the course of their reporting, highlighting that additional attention should be paid to performance management.

“The results help illustrate why companies increasingly find it necessary in today’s age of volatility to invest in their performance management,” said Scott Brennan, an executive director in the Accenture Finance & Enterprise Performance consulting group. 

“Those that tend to be happiest with the results of their enterprise performance management are those that have a vision – they understand their company’s strategy; they have a clear view of the metrics they need to monitor and they know the importance of integrating an enterprise-wide EPM solution.”

As a result of unreliable and opaque data, finance teams are being presented with significant challenges, according to the report from Oracle and Accenture.