The Role of the Financial Planning & Analysis Professional

Financial planning and analysis (FP&A) professionals utilise both quantitative and qualitative analysis of all operational aspects of a company to evaluate the company’s progress toward achieving its financial targets and mapping out future goals and plans.

FP&A Analysts analyse economic and business trends, review past company performance and attempt to anticipate opportunities and potential problems. This allows them to establish a financial reporting system that can effectively forecast the company’s future financial results.

FP&A professionals oversee a broad array of financial affairs, including income, expenses, taxes, capital expenditures, investments, and financial statements. Unlike accountants who oversee recordkeeping, financial analysts are charged with examining, analysing, and evaluating the entirety of a corporation’s financial activities, utilising financial projection software to forecast the company’s financial future.

Most importantly, the company’s financial analysts are expected to provide senior management with analysis and advice. Utilising financial reporting software, they can inform management on how to most effectively utilise the company’s financial resources to increase profitability and grow the company at an optimal rate, while avoiding putting the company at serious financial risk.

Here at ICit, we have built a track record of helping FP&A professionals to utilise the best financial planning software for their business and industry. Working alongside you and your finance team, we can help you to find high effective financial analysis solutions that help inform future decisions.

Integrated P&L, Balance Sheet and Cashflow

The core skill of the FP&A Analyst is the ability to understand the company’s financial statements – Profit and Loss, Balance Sheet and Cash Flow. As we know, these three statements are intrinsically linked and dependent upon each other. Building a robust financial model can be challenging, since it needs to reflect the specific drivers of the company, be flexible to account for changes and allow for scenario planning (such as using driver-based planning).

Whilst most FP&A teams rely heavily on spreadsheets for modelling, there are countless examples of companies citing spreadsheet errors (either data input, formulae logic or both) as the reason they missed financial targets, or worse, ran out of cash leading to administration. This is where spreadsheets really begin to fall down in terms of available financial analysis options.

What are the Main Problems with Financial Spreadsheets?

There isn’t an excuse for not having a robust FP&A tool that supports the essential work of planning and analysing financial performance. The problems with using spreadsheets as your main financial projection software in a corporate environment are well documented, including;

Security: cannot secure data from usersMaintenance: they are labour intensive and time-consumingVersions: holding multiple versions is error prone
Silos: departmental solutions everywhereNot Documented: only the author understands the modelAuditability: difficult to track changes and errors

Whilst we are not advocating for the death of spreadsheets entirely (they are invaluable for testing ideas and used as the interface or reporting solution), it should be known that in a multi-user corporate environment they have too many drawbacks to be trusted as a financial reporting tool.

How to become a World Class Financial Analyst

Reputation is everything when it comes to working as an FP&A professional. As in most walks of life, people remember the bad news (errors) more than the years of diligent effort! To mitigate the risks of errors and reputational damage, smart companies are investing in the latest FP&A tools.

With the right tools in terms of financial projection software and financial reporting systems, the FP&A team can build trust and confidence in their work and become strategic business partners – supporting the CFO and guiding the CEO. Some of the advantages of adopting a corporate performance management solution are tabled below:

Align Plans: reconcile 3-year plans and annual budgetsScenarios: in minutes rather than daysSpeed: cut planning cycles by 50%
One Solution: plan and analyse all departments and usersAgile: change complex models on the fly, fully auditedConsolidate: close month end in days not weeks

To become a World Class Financial Analyst requires many skills; intellect, communication, teamwork, leadership, attention to detail and an appreciation of the wider picture such as the macro-economic factors that may impinge on corporate strategy. However, the overriding expectation is that the financial analysis is accurate and can be relied upon to support important decisions.

The biggest obstacle to achieving this goal is the lack of time to complete the analysis, to verify the results and to write the storyboard to support the analysis.

Where do you start with financial planning software?

The good news is that there are a number of excellent financial projection tools on the market today. Using cloud technology (to reduce reliance on internal IT and to provide potential for countrywide or worldwide adoption) it is possible to get up and running in a few weeks.

Here at ICit, we provide a proof of concept service; “Try before you buy”. We need a couple of days, sample data (or existing spreadsheets) and some time with you to define the problem. We have delivered more than 400 FP&A projects, advising on a range of financial reporting systems and financial analysis solutions, so it is likely we have solved your problem for other customers previously.

The proof of concept workshop usually lasts for a day and we may need an additional day to make it presentable for senior management review. Most customers are amazed by what can be achieved in a couple of days and understand the benefits immediately. The most insightful see the potential for multiple solutions using a single platform – building an integrated business plan, spanning finance, sales, marketing and operations.

Real World Use Cases

Customers who have taken the path to World Class FP&A status using ICit solutions have developed many and varied applications to meet their specific needs. Whilst the integrated Profit and Loss, Balance Sheet and Cashflow are the most frequently deployed, the benefits of integrating sales, marketing and operations planning increased the value and capability of the FP&A team to provide insight, forecasts and plans with a highly effective range of financial reporting systems.

P&L, B/S, Cash Flow
Strategic Planning
Market Share
Sales Plan by Territory
Marketing Promotions
Campaign Planning
Workforce Planning
Capacity Planning
Demand Planning
Supply Planning

How do I find the right support with financial analysis?

To discuss your financial and operational forecasting requirements, please contact ICit for a free consultation and to discover how we deliver a range of financial reporting and financial planning software solutions to companies just like yours every day.

T: 01565 831900 | |

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“The consolidation of the figures is now completely automated,
and creates total confidence in the numbers”

Head of Decision Support

Charles Stanley

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