Many businesses struggle to keep track of their finances and risk management. Without the right tools for your debt portfolio, you may encounter high-interest costs, increased financial risks, inadequate reporting, inconsistent workflow, and more. To avoid these problems, it’s time you realise the importance of digital tools in your business.
According to Deloitte, 82% of businesses implement digital tools in their accounting and finance management to improve their workflows and enhance financial insights. This includes software solutions such as accounting software, treasury management system (TMS), enterprise resource planning (ERP) system and more.
With that, here’s why you need financial tools in the business to help maintain your financial control.1. It boosts transparency
To better manage your finances, it’s crucial to know how much money enters and leaves your business. This knowledge allows you to make smarter decisions on how to use your company’s resources and avoid overspending.
2. Ensures accuracy
Manually managing your business finance can result in many errors, including human-related errors such as typos, miscalculations, missing entries, lack of correct data within the organization, and more. Although these mistakes may seem trivial at first glance, they can result in a huge financial loss for your business. So, minimise manual financial work within your organization by using modern financial tools.
Software solutions can provide you with more reliable financial data. It ensures the data you use is accurate and up to date. This way, you can more or less predict the possible outcomes of every action and decision you make for your business.
Many businesses use the software as Nordkap for financial forecasting since it can analyse historical data and market trends faster and more accurately than humans. It can also provide you with a more reliable risk assessment for better debt management in your business.
3. Centralises financial data
Thanks to digitization, managing and organising financial data is easier than ever. Nowadays, you can go completely paperless when handling your finances. That means you don’t have to wade through mountains of papers or sift through your file cabinets to look for a particular ledger or spreadsheet.
Investing in modern financial tools allows you to fully embrace digital transformation in your financial management. It digitizes data and stores them in one accessible database. Some businesses use cloud-based software to be able to access this database via other devices such as their smartphones, tablets, and personal laptops.
Moreover, modern financial management tools and techniques do more than centralise financial data. It also centralises the different processes in your finance management. For example, you can do all your financial forecasting, debt management, risk management and more in just one platform.
4. Generates reports
A data-driven approach to financial management has a lot of benefits for businesses. It helps pinpoint the root causes of issues in an organisation’s financial management. Likewise, it can help business owners make smarter decisions and find ways to improve the financial performance of a company.
Digital financial tools allow you to optimise the use of financial data in your business. It does more than extract and analyses data from different processes of your operations. It also presents such information in a digestible and summarised format. This way, you can gain valuable financial insights in just a glance. You can then use this information to have better financial control over your business.
5. Streamline workflows
Finance management involves a lot of repetitive and menial tasks. If you aren’t too careful, it can cause a lot of bottlenecks in your finance operations. Many businesses automate their finance management instead of doing everything manually in Excel. This allows them to streamline their workflows throughout the organisation.
Modern tools like a Treasury Management System (TMS) can minimise the amount of manual work. It can automate accounting, financial reporting, financial forecasting, risk assessment, and more. This offloads certain tasks from your roster, giving you more time to focus on decision-making, resource planning, and growing your business.
Choosing the right tools
The acceleration of digital transformation in business means investing in modern tools is necessary to remain competitive and relevant in the market. Nowadays, tools like TMS, accounting software, and ERP systems are must-haves. So what are you waiting for? Go ahead and explore what modern tools you need to improve your financial control over your business.