Almost one in three Irish companies has reported a lack of funds to invest in personnel as a key barrier to managing their financial activities, according to a new report.
The report, Finance evolution: Thriving in the next decade, was carried out by PwC, the Association of Chartered Certified Accountants (ACCA), and chartered accountants ANZ. It is based on responses from more than 2,300 global finance leaders, including 85 in Ireland.
The report examines the development of the “finance function” of companies towards 2030 and beyond, and outlines steps it says finance leaders should consider.
A finance function is a department within an organisation responsible for managing its financial activities. This includes budgeting, forecasting, financial reporting and ensuring compliance with financial regulations.
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Just 22 per cent of Irish companies said they have a fully developed vision for their finance function looking to the next three to five years, which was behind global peers (29 per cent).
Furthermore, just 13 per cent said the concept of “value and purpose-focused accounting” significantly influences the strategy of the finance function, far behind global peers (31 per cent).
Almost half (46 per cent) of Irish respondents said current technologies do not meet their organisation’s needs, and were a much greater barrier to enhancing the role of the finance function compared to global peers (30 per cent).
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At the same time, three-quarters of Irish respondents agreed that artificial intelligence (AI) could be a useful tool for data mining and analysis activities within the finance function in the next three to five years.
Other key barriers to enhancing the role of the finance function included a lack of understanding of the areas where the finance function can add business value (31 per cent), as well as poor quality data not supporting decision making (24 per cent).
“New technologies and, in particular, generative AI, have the potential to fundamentally change the role of finance professionals,” said head of ACCA Ireland Stephen Noonan.
“Irish survey respondents had a more positive response than their global counterparts about the benefits that AI can bring across a range of finance activities. So the potential is clearly recognised and Irish professionals are keen to leverage these technologies.”
The report calls on chief financial officers and finance leaders to embrace new technologies, develop critical skills within their teams and uphold the “highest ethical standards” to ensure their organisations’ success in the coming years.
Ruth McNamee, PwC Ireland finance transformation director, said finance teams “can no longer be seen as being in a support role, and instead need to evolve and take on an increased span of control beyond the traditional financial remit ... For finance functions to stay relevant, they need to look ahead. The role of the CFO [chief financial officer] is fast evolving beyond finance into the role of chief value officer.”
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