Finance Analytics & MIS

Objective of Service

What is financial analytics? Financial analytics or financial data analytics is the art and practice of assessing the financial and accounting records of business to measure ongoing financial performances, deriving financial projections for the future, churning meaningful insights for improved decision-making and course correction, or answering any question that the data is capable of answering. Why we say it is an art is because it takes a bit of practice and understanding of the working of the analytics tools to make them give the answers you need. Modern-day finance analytics and MIS tools come with advanced features that make it easier to use them in achieving the intended reports, insights, or answers.
Through this service program, DFX offers finance analytics advisory services to businesses of all sizes across verticals.

Importance of Finance Analytics

• Improved financial planning: Because financial analytics allow businesses to measure the impact of their existing planning, strategies, and decisions that leaves an imprint on their financial data, the assessments can be used to improve financial planning for the future or new projects and decisions. For example, in defining the financial terms of engagement with new suppliers, businesses can use financial analytics to cover any flaw with their previous policies that proved to be detrimental to business. With real-time analytics, businesses need not wait till the end of the month or the year to extract insights for better planning and execution of business decisions.
• Keeping track of financial performances: Once a decision is made in business or a plan or strategy is approved for implementation, it also carries financial repercussions in the form of investments and expenditures. It becomes important for businesses to keep a track of their financial planning and performances to ensure that what was planned and what is actually happening are in congruence. For instance, businesses can project the movement of their working capital ratio at shorter intervals to ensure that corrective measures can be initiated to maintain the ideal/planned situation if projections speak otherwise. This projective approach can be applied to other areas of financial management as well.
• Gaining insights not humanly possible at scale: Analytics tools are capable of taking into consideration massive volumes of data to derive insights and find answers. Then, with the advancements made in the field, these tools are becoming more intelligent and efficient in delivering results. Going manually, it would either be impossible or extremely time-consuming to achieve what these software programs are capable of. This is where software-run analytics proves to be more useful in the analytical review of financial statements and tons of other financial data.

How Finance Analytics is helping organisations?

• Budgeting: Budgeting is planning and projecting the income and expenditure of an entity in the future. It provides an opportunity to businesses to assess their levels of income and utilize their investments, revenue, or funds in a judicious and strategic manner. Effectively, it allows them to keep a check on their liquidity and solvency. Business operations might come to a halt if expenses run over income/revenue at any point or make them go for short-term loans. Finance analytics help businesses assess their income and expenses more accurately based on past data and projections for the future.
• Cash flow analytics: Cash flow analysis is a very important consideration when it comes to maintaining a healthy working capital. The three main metrics to evaluate the cash status of a company are its net operating balance, net investing balance, and net financing balance. Finance analytics brings all this data into a unified platform and allows the decision-makers to predict and project the cash flow status of the business in the near future. It gives them the opportunity to assess the implications of their decisions on the cash flow status of the business. And if the assessments are not in favour, corrections are made.
• Cost control: Keeping its costs under check remains one of the hard-fought endeavours of businesses. Any unplanned increase in expenditure not only affects the profitability but also lashes out a spiralling impact on the budget. Finance analytics and information systems help businesses monitor the emerging trends and patterns of expenditure being made across various cost headings and departments of the organization. It allows businesses to initiate corrective measures on time to ensure that whatever is causing the deviations is prevented. A simple instance would be sales expenditure. On the field, the sales/operations team may have to incur many unplanned expenses. The sales department can be asked to come up with solutions to control any unwarranted expenditure before the actual expenses deviate much from the budget.

Why DFX for Finance Analytics Advisory?

DFX represents an expert team of professionals with over eight years of experience. We offer finance analytics advisory and consulting services to businesses across a multitude of verticals. From assessment to recommendations, we follow a planned, proven, and systematic approach in delivering our financial data analytics consulting services.
If you want to know more about our financial analytics consulting services, drop us a message and we shall be happy to reach out to you.

Finance Analytics & MIS

The use of analytics in finance helps businesses read their financial data in an objective and scrutinizing manner towards deriving answers and insights for achieving a higher degree of prudence and accuracy in their financial management and financial strategy formulation and decision-making. Financial MIS (Management Information System) is a platform to collect and store the financial data of an enterprise which is later accessed and used for the purpose of analytics.

In this topic, the learners shall be introduced to the fundamentals of financial analytics and MIS. Once the basics are covered, the topic shall deal with the practical application of these concepts in real-life business scenarios.

Predictive Analytics

Objective 1: Early Warning Signals

Predictive analytics help in identifying possible future outcomes based on past data. These assessments can serve as early signals for business opportunities or threats and provide time for corrections and adjustments in product design, strategies and operational planning.

Objective 2: Easy and informed decision-making

Predictive analytics is based on statistical modelling and estimations, sometimes using advanced technologies like Artificial Intelligence and Machine Learning. This puts businesses in a more informed position (data evidence wise) to support their decisions or withhold one.