Insight by EY

Data, analytics driving federal financial management transformation

Federal chief financial officers are right in the middle of two big technological trends—the cloud and data analytics.

Look no further than the President’s Management Agenda. Of the 14 management priorities, CFOs easily have a major role in half of them.

Let’s just look at one of them–federal IT spending transparency. The managing partners are three CIOs and three CFOs.

The goals under federal IT spending transparency focus on implementing the Technology Business Management to improve business outcomes, to increase efficiency of IT investments and to enable IT benchmarking.

All three of these are about collecting data, understanding data and then putting that data to use to make decisions.

At the same time, there is a lot of desire and opportunity to make better use of data in the financial management community.

A 2017 survey by the Association of Government Accountants found 44 percent of CFOs who responded are using data and evidence to make decisions. Additionally only 14 percent of the CFO respondents said they see their office as providing analytical support to the agency, while 25 percent said they see their office as providing mostly compliance and 21 percent said their office is providing mostly transactional services.

As the need for continued integration of data and technology drives toward better decision making, agencies need to consider how they design, implement and utilize tools in support better financial management.

The Changing Role of the CFO

The traditional CFO role as we know it is shifting from reporting, compliance, financial statements, running systems to a new approach where CFOs help agencies derive strategy, value, risk management and providing overall financial management leadership to the organization to manage taxpayer resources effectively.

Data Access and the Cloud

We are seeing increasingly clients are looking for this hyper-scalable cloud environment where they don’t’ have any limits or bounds upon the data they will populate in the data lake, and allows them to use new analytical tools to join structured and unstructured data to create new insights.

Workforce of the Future

The CFO is becoming more and more a holder of the single source of the truth to be able to talk to the functional people that are in charge of readiness and want to use this data.

 

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