At the fifth AI/ML FP&A Committee meeting, Igor Panivko, FD & MD at Konica Minolta, talked about dynamic and interactive Sales Planning based on the algorithmic model. He shared his experience in harnessing data in FP&A and how the company tried to solve some of the challenges which are typical for the finance function. 

Traditional budgeting process normally starts with forecasting sales levels, cost of goods sold then all operation expenses until reaching to the proforma income statement without understanding how changes in costs (both variable and fixed) & sales will affect profits in future periods. But modern FP&A professionals started to implement CVP analysis during the annual profit plan to study the interaction of sales with variable & fixed costs on the profits received.

Sometimes, what you forecast needs to change dramatically, due to e.g. market disruption or internal changes. You also might not monitor every business the same way, because each might be in different development stage or ´situation´. By looking at the company itself, but also possible (management) crises, you can determine what the focus of the forecast should be. 

It’s early days for the UK’s new leadership team, and whilst Boris Johnson is not everyone’s cup of tea, there is a new momentum and style coming from Downing Street. This will have implications on further turbulence in Westminster over the coming weeks as we count down towards the latest Brexit deadline of 31st October 2019. What can be said is that the Cabinet is united for the first time since the Referendum, and that there is a revived sense of purpose and activity.

Welcome to the fourth issue of the monthly FP&A Trends Digest! This time we will share some essential tips on strategic finance, the purpose of planning, the driver-based analysis approach and the power of scenario planning.

What is the Holy Grail for any leader? For me, it is to create a high-performance team AND to sustain that team over time through high-performance leadership. That is not easy to do, so when we get the chance to learn from someone who has managed to do it really well, we must pay close attention. In this first “FP&A Talks” we’re speaking to Fredrik Hedlund, Senior Vice President and CFO for Global Connect at Nielsen. Fredrik is one of the few senior leaders who has truly invested in creating a high-performance leadership team and it shows. “FP&A Talks” is a new series running on fpa-trends.com featuring senior leaders in Financial Planning & Analysis who share their views on how we can create a world-class FP&A department. 

The idea that your analyses are not impacted by your behavior is belied by a new field of research called behavioral accounting. This focuses on the impacts of behavior on accounting frameworks and their data products. 

Forecasting new product launches are a tricky business with plenty of emotional baggage. They are also often, inevitably, wrong. This blog argues that when commercial finance or FP&A professionals are involved they should focus equally on model flexibly as well as the outcome.

Ask anyone working in the finance field now, how much time you consume in some manual tasks; such as data entry, accumulation & validation of data, accounts reconciliation & preparing some basic statements or reports. Unfortunately, statistics say that more than 35% from Accounting & Finance Teams spent from 50 to 70% from their time on manual processes & data entry on ERP systems!

Normally, integrating actuals into the planning cycle is not an easy task. Often financial and operating results are spread across multiple databases and actual results and plan detail are at different levels. All of this makes meaningful Performance Evaluation difficult.