Accounting Data Analytics: Why Should Firms Bother with Data?

Posted by Janis Narvas

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Dec 19, 2017 8:00:00 AM

accounting data analyticsIn the past five years, accounting data analytics has been a subject of much interest among finance and accounting professionals. Technologies that help us perform business analytics in finance have been widely applied in firms and businesses, offering us unprecedented developments in data analysis accounting and mining.



In Australia, big data analytics has become
one of the top priorities of enterprises. Many companies are now investing in analytics tools and services to enhance their business processes and develop better services and products. But what exactly is data analytics? What are the benefits of accounting and business analytics for accounting firms? Why should firms bother with it?

What is Accounting Data Analytics?

Data analytics refers to the process by which data is aggregated and analysed in order to make better business decisions, improve business processes, and aid strategic planning.

Business analytics in finance and accounting can help chief financial officers derive meaningful information that can be applied to improve their company’s financial performance and retain a strategic advantage over the competition.

Business Analytics in Finance and Accounting

With the advent of big data and robotic process automation, it would not be surprising that accounting and business analytics will become inextricably linked. There are many applications of data analytics in accounting, some of which are listed below:

  • Increase transparency.

    By using big data analytics in financial statement audits, organisations can have a better handle on their performance. In addition, you can achieve transparency through high-quality reporting and reliable data, which are useful for better investment and strategic decisions.
  • Detect irregularities.

    Forensic accountants can use data analytics and related technologies to detect irregularities in large volumes of transactions.  By using analytics tools, identifying activities that can be indicative of fraud becomes less complex.
  • Improve forecasts.

    Through data analytics, organisations can get comprehensive information that they can share with stakeholders. When supplemented with business intelligence systems, accounting professionals can even get precise and real-time information on their client’s financial performance, which can aid decision makers in improving business processes.

 

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