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Feel The Rush: On Analytics + Finance

Technology   |   Shane Remer   |   May 27, 2020

Big Data is the new gold — but is your finance team “mining” it? Just like sifting through particles in river sand, if you’re sifting through spreadsheets to strike gold, it’s going to take a while to find a nugget.

So, say goodbye to ancient methods and say hello to new solutions. From financial forecasts to internal audit processes, explore how some of the biggest, most reputable companies are using data to stay gold.

Rain, shine, and a chance of fluctuating interest rates: Financial forecasting that considers internal and external factors

Cetera Financial, one of the largest independent financial broker-dealers in the U.S., knows that nothing exists in a vacuum, including financial forecasts. They realized that to achieve better and more accurate revenue and expense forecasts, they would need to consider both internal and external factors. Now, their financial forecasts are based on 10-20 internal and external drivers, including economic changes, raw materials, supply changes, inflation, and seasonality. They went beyond traditional, internal data sources and created predictive analytic models that accounted for macroeconomic factors. Cetera executives can now easily see the effect of each factor (internal and external) on the Gross Dealer Concession.

Fast Facts

Company: Cetera Financial

Goal: Implement more accurate financial forecasting

Solution: Created a new analytics engine that considers 10-20 internal and external factors

Results: Company leaders have more reliable five-year forecasts and are able to see the effect of each factor on Gross Dealer Concession

From 24 hours to 24 minutes: Automating processes (and saving time)

End of month is one of the busiest and most critical times for Controllership, and at Thomson Reuters, a leading provider of business information services, 24-30 hours of that valuable time used to be spent on conducting cost assurance processes — every month. The company knew if they could create a repeatable workflow and remove the pre-analysis work from the hands of end users, they’d be able to focus more on value-added activities and analysis (rather than data wrangling). They created a workflow that loaded general ledger (GL) line item data into Alteryx and performed every step of analysis that used to be done manually. The post-query process on thousands of lines per month and YTD GL line items can now be completed in less than 30 minutes a month.

Fast Facts

Company: Thomson Reuters

Goal: Automate time-consuming, end-of-month cost assurance processes

Solution: Developed a repeatable workflow that loads GL line item data and performs every step of analysis

Results: Turned a 24-hour process into a 24-minute process, letting the controllership team focus on value-added activities and analysis

Kick sampling to the curb: 10-million-transactions-strong audit

Internal audit processes are time-consuming, tedious, and incredibly labor-intensive, but they don’t have to be (really!) The leadership team at Aetna, a healthcare company, decided to change its audit process from just that. Before, they relied on a traditional process where auditors would test a sample from their dataset.

This process was long, requiring anywhere from two to six months, and it was difficult for auditors to know whether the dataset was a truly representative sample. Using risk modeling, the Aetna team was able to eliminate the need for random sampling. Instead, their new process tests all 10 million transactions, identifying only those that appear suspect. Aetna auditors can now use a self-service dashboard and receive information via email in near real-time about a current audit. Aetna completely changed its audit process, increasing the accuracy of audits while decreasing the labor needed to complete them.

Fast Facts

Company: Aetna

Goal: Change time-consuming, labor-intensive audit process

Solution: Automated parts of the audit process using risk modeling

Results: Increased accuracy of audits, decreased labor needed to complete them, and gave auditors more visibility into the data process

45 problems, but Wayfair tax compliance isn’t one

With the Supreme Court’s Wayfair decision, companies now need to keep abreast of the tax laws in 45 states, including when tax thresholds are reached, filing dates, payment guidelines, and rates — factors that not only vary state to state but also constantly change within each state as laws are amended. Grant Thornton, one of the world’s leading organizations of independent audit, tax, and advisory firms, is helping its clients keep up with these requirements. They created an always-up-to-date model that performs “Wayfair analysis” using data from their clients. With their solution, Grant Thorton is able to help its clients see their current tax status across the country in a matter of seconds, relieving a tremendous administrative burden.

Fast Facts

Company: Grant Thorton

Goal: Help clients manage the tax requirements of 45 states

Solution: Built an always-up-to-date model that keeps up with each states’ requirements and runs in seconds

Results: The company’s model has helped over 200 of its clients relieve a tremendous administrative burden

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