In order to answer some business questions as well as predict possible future financial situations, a financial analysis is done by using financial analytics. Businesses can use financial analysis software to speed up the creation of financial reports and present the data in a manner that is easier to read and understand.
Reasons for businesses to do financial analytics
- Today’s companies require timely information that assists the managers to make key decisions in the company.
- Helps a company to have a proper financial planning and prediction to leverage the company.
- The introduction of new business models, growth in technology and the ever-changing needs of the traditional financial department demand the need for financial analytics.
- Financial analytics assists a business in shaping its future goals and improving the decision-making strategies for the business.
- Financial analytics can assist a company to determine and manage its physical assets like cash, machinery, furniture, and
- It helps a company to have a broader insight of its financial status, and help the company to improve cash flow, profitability and the value of the business.
- Financial analytics can assist managers in making smart decisions to increase a company’s revenue as well as reduce wastage in the company.
- Tax, accounting and other areas of finance require a data warehouse, which should be combined with financial analytics to effectively manage the company and help it achieve its desired goals.
Software programs which can be used for financial analytics
- Oracle financial analytics – this software allows one to have an insight into the general ledger and also provides visibility of the budgets performance as well as how employee and supplier performance, as well as staffing costs, impact customer satisfaction and revenue growth.
- SAP ERP financial analytics – it helps a business to define its financial objectives, monitor costs, and revenue during the execution of financial plans and develop business plans.
- IBM Cognos finance – provides a business with an out-of-the-box data analysis capabilities for workforce management functions, sales, and supply chain procurement.
- NetSuite – offers reporting and analytics as well as financial dashboards that allow real-time monitoring of personal key performance indicators.