To stay and survive in business, companies have always banked on accountants to show them the way. This, however, has been the traditional approach that is changing fast.
Accountants and Accounting firms have now become hugely dependent on Business Intelligence dashboards or Information Management tools as they are also known to help them track important metrics, KPI’s and related key data points relevant to a particular business, department or a specific process. Big companies all across the globe such as GE Healthcare, Aston Martin and London Airport are also using these BI dashboards to assess their performance.
Business Intelligence dashboards assist accountants in making the right decisions for their clients by visualizing critical data in a single view. The most well-represented dashboard will allow decision-makers and management to be able to take past and future views through data and data sets.
These BI dashboards can provide a very powerful opportunity to help both accountants and businesses become productive which will help in strong and sustainable business performance in the long run.
For example, a sound and reliable BI dashboard can allow an accountant to analyze accounts payable as well as accounts receivable reports to assess critical financial performance indicators. Accountants can also get an easy-to-read, up-to-date visual reference for crucial metrics such as cash management, gross working capital, and inventory inflow and outflow. Studying these metrics further in detail can then equip an accountant to make more informed decisions for a company concerning its financial health and long-term sustainability.
An excellent BI dashboard can be useful to an accounting firm in the following ways:
The 3 best BI dashboards which an accounting firm must track are as follows:
1. Profit and Loss Dashboard
This dashboard provides an easy-to-understand overview of the income statement of the business. From measuring net profit to revenues, this BI dashboard’s capability is further enhanced by the inclusion of various performance ratios.
The dashboard primarily consists of four financial indicators:
The heads-up information right at your fingertips can be further utilized to reveal month-to-month as well as year-to-year trends of other values such as EBIT ( Earnings Before Interest, and Tax ) and EBITDA ( Earnings Before Interest, Tax, and Depreciation.
Profit and Loss Dashboard displays important performance metrics that describe the overall health of the business and the profitability of business operations.
2. Financial KPI Dashboard
The Financial KPI BI dashboard reveals the most prominent KPI’s(Key Performance Indicators) which will help the company in achieving stable and proactive management and operational processes.
This dashboard will answer critical questions concerning
The KPI dashboard will usually start with an overview of the current working capital consisting of current assets and current liabilities. This will instantly tell an accountant whether the company is liquid, operationally efficient and financially healthy in the short term.
The dashboard then focuses on the CCC(Cash Conversion Cycle) which will depict the efficiency of the company in converting its inventory, investments, and resources into cash flows.
Another element covered by the dashboard will be a state of invoicing and paying processes of the business. This will mitigate issues related to:
3. Financial Performance Dashboard
The Financial Dashboard is one of the most critical and popular dashboards among accounting firms worldwide. It explains to the accountant as to how efficiently is the company spending its capital as well as displays the main metrics of the company balance sheet.
The 4 key parameters of this dashboard include:
These parameters very easily depict how well are the company assets being regulated and managed.
The balance sheet breakdown is where the dashboard outlines the Long term assets and total liabilities of the business.
This BI dashboard gives a lot of valuable information regarding the capital structure of the company. On one hand, where the debt-equity ratio explains how much debt is being used by the business to finance its assets and operations, the ROE and ROA figures are key figures if the business is listed on the stock exchange and hence give investors an idea of its credibility in the market.
The Financial Performance BI dashboard helps to keep an extremely close watch on these essential aspects of the progress of a business and thereby ensure its long-term viability and success.
A common thread emerging in today’s business is that BI dashboards in Finance make business growth possible. Not only accountants but these dashboards can also be used by c-level management, department managers, professionals, and finance experts that need a clear overview and mastery over their data.
Accountants are always under intense pressure to deliver fast insights and clear and reliable financial reports. By using the above BI dashboards, they will be able to swiftly measure and comprehend the data accurately and in real-time. BI dashboards provide accountants with the power of data visualization in monitoring and analyses of financial performance.