- 85% respondents in India believe finance teams are increasingly expected to measure and communicate long-term value to investors and stakeholders
- 78% finance leaders in India indicate there is significant value for their organization which is not measured or communicated using traditional financial KPIs
New Delhi, 9 March 2021: In today’s fast-changing business environment, finance leaders in India are challenging the traditional role of reporting and making bold moves required to maintain corporate reporting’s relevance as a result of the pandemic. This is according to the sixth annual EY Financial Accounting Advisory Services (FAAS) survey, How can corporate reporting connect your business to its true value? The survey gathered the views of over 1,000 CFOs and financial controllers across 26 countries including 41 respondents from India.
The survey report indicates that finance leaders are rethinking the role reporting plays in enterprise value with 85% respondents in India (72% globally) indicating that finance teams are increasingly expected to measure and communicate long-term value to investors and stakeholders. In addition, 78% respondents in India (65% globally) indicate there is significant value for their organization which is not measured or communicated using traditional financial KPIs.
Sandip Khetan, National Leader and Partner, Financial Accounting Advisory Services (FAAS), EY India says, “The pandemic has clearly put forward two critical priorities for finance leaders to address. They need to rethink the role corporate reporting plays in measuring and communicating enterprise value through focus on achieving reporting excellence and wider and deeper coverage of non-financial performance KPIs across the organization. Secondly, finance leaders need to take a fresh look at how finance and reporting aspects are delivered currently and how this process needs to be transformed to be future-ready.”
Finance leaders anticipate their function to look very different in the future, with a major shift to a smarter operating model. 88% respondents in India (81% globally) think it is likely that, over the next three years, core finance processes — from reporting to accounts receivable — will be automated at scale, with finance teams freed up to do high-value tasks. Further, 90% respondents in India (77% globally) see probability of Artificial Intelligence (AI) and machine learning transforming the financial close process leading to “continuous close”, in the next three years.
To make the most of smart technologies in corporate reporting, respondents identify building trust as a key prerequisite. 63% finance leaders in India (68% globally) indicate that governance, controls and ethical frameworks still need to be developed and refined for AI. Without those frameworks, 54% of finance leaders in India (63% globally) are concerned about the risk implications of using AI in finance and reporting from security threats to regulatory risk.
88% finance leaders in India (69% globally) believe that CFOs and senior finance leaders are increasingly seen by key stakeholders as the stewards of long-term value in their organization. In addition, 81% respondents in India (66% globally) believe finance controllers will be taking on increasingly more of the CFO’s responsibilities and 76% respondents in India (67% globally) indicate CFOs will spend less time on traditional finance responsibilities and more time on driving enterprise-wide digital transformation and growth.
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About the survey
How can corporate reporting connect your business to its true value? surveyed more than 1,000 CFOs and financial controllers of large organizations to understand the challenges they face in corporate reporting. The research was conducted by Longitude on behalf of EY Global Financial Accounting Advisory Services (FAAS). Half the respondents (50%) were from the CFO community, with more than one-third (35%) of respondents representing financial controllers. The remaining 15% of respondents were finance directors or leaders in the treasury function. A majority (62%) of respondents’ organizations have revenues in excess of US$5b a year, and 10% in excess of US$20b a year. Respondents were split across the Americas; Asia-Pacific; and Europe, the Middle East, India and Africa (EMEIA). Thirteen main sectors were represented, with 56% of respondents’ companies being publicly held or listed and 44% privately owned. The survey was supplemented by in-depth interviews with CFOs and heads of reporting organizations, as well as EY subject-matter professionals.