How Australian CFOs can master the modern finance balancing act

Remember when heading up a finance department meant making sure the books were balanced and the bills paid on time?

Relaxing, wasn't it – relatively speaking, at least! By contrast, many of today's CFOs are required to contend with a plethora of pressing operational priorities while still attending to the aforementioned book balancing and bill paying. 

That they'll do more with less – and do it far more quickly – has become the expectation in many boardrooms and C-suites around the country.

Managing risk 

With business conditions and confidence at a low ebb in many sectors – NAB's Monthly Business Survey: April 2024 saw a fall in forward orders, driven by the mining, manufacturing and construction industries – local enterprises are having to work longer and harder to preserve their margins and achieve profitable growth.

Unsurprisingly, insolvencies are on the up and up – ASIC data for the nine-month period from 1 July 2023 to 31 March 2024 showed a 36.2 per cent increase in company failures compared with the corresponding period the previous year. That means mitigating the risk posed by delinquent debtors will be an urgent imperative for CFOs in FY2025.

Doing more with data

Meanwhile, finance chiefs are being asked to lend their counsel to leadership teams looking for expert input and advice on key decisions regarding all aspects of operations. 

In many instances, that means diving into the data and extracting the salient insights necessary to deliver an informed view. It's easily enough done for those working in organisations that have deployed finance technology with sophisticated data analytics capabilities. But for CFOs who are persisting with disjointed Jurassic-era platforms and programs, it can be an almost impossible ask. 

Holding the team together

Keeping finance personnel engaged is no easy matter for finance leaders either, particularly given the sector's ongoing skills shortage, previously described as critical by the industry's peak body, CPA Australia.

Fewer young people are entering the accounting profession, which means those who do can be much more choosy about where they work. Providing opportunities to undertake challenging and rewarding assignments is essential and that means ensuring workers aren't mired in the mundane tasks that, historically, accounted for the bulk of the average finance professional's working week.

Tools to make the tasks easy

All up, it's a lot, as the younger generation might put it. In fact, meeting expectations on multiple fronts and ensuring the bread and butter accounting tasks are completed on time every month or quarter can seem like an impossible ask in the absence of an army of extra bodies.

Embrace financial automation technology and it starts to look far more achievable.

Rather than relying on spreadsheets and manual processes, a rules engine can be used to automate repetitive activities – think intercompany reconciliations and the marrying of credit cards and invoices to Purchase Orders.

In addition to cutting down the number of hours needed to complete such tasks, automation reduces the error rate to virtually zero. That means employees don't have to waste time detecting and rectifying errors – which equates to even more time saved. It can be spent on higher value activities, such as generating the timely insights leaders need to make data driven decisions. 

Automating the accounts receivable function, meanwhile, will allow your enterprise to maintain an accurate, up-to-the-minute view of its debtors and become more proactive about flagging and pursuing customers whose accounts are overdue. 

In today's uncertain times, there's no surer way to protect your cash flow and bottom line from the existential risk bad debts can pose.

Contributing to profitability and growth in FY2025 and beyond

From fuelling growth to producing real time insights and retaining top talent, the onus will be on CFOs to keep delivering the goods in what's likely to be a challenging economic period. Having access to the right technologies can make it easier for you to do so – and to provide game changing value to the organisation you serve. 

That's why deploying automation technology to transform the finance function is one of the smartest actions Australian finance leaders can take. 

If it's on your agenda for FY2025, you'll find it's an investment that's likely to pay for itself, over and over again.