Your business’s financial health is something you need to think long and hard about. Poor money management can lead to its failure. Your priority should be improving the way that departments and employees handle company funds. The easiest way to do this is with financial planning and analysis software. More often than not, this type of software includes many different features, ranging from budgeting and forecasting to report generation. However, some programs put more emphasis on certain features than others. This post will tell you about six different types of financial planning and analysis software you need to know about, so you can find one that’s right for your business.
Financial Reporting
Every single financial planning and analysis program available today offers some kind of financial reporting. However, some put more emphasis on it than others. If you want the leading financial analysis software available, then find one with a heavy focus on financial reporting. Financial reporting allows you to get a good idea of what your company’s finances are like. Understanding what kind of condition your company’s finances are in can make it a lot easier for you to make important decisions and budget allocations. You may want to hire a trained accountant to work with you to understand your reports because they can be complicated. Untrained individuals often have a hard time interpreting them. Something worth noting about financial analysis tools is that many also offer simplified reports to allow untrained individuals to interpret what they are reading.
Budgets and Forecasts
You also need to find software that puts focus on budgeting and forecasting. Your company will need to budget and financial forecasts so that it can figure out how to allocate company funds. The process of budgeting can be somewhat complicated, especially if it involves changing the way one’s company spends money. The good thing about most financial planning and analysis programs is that in addition to explaining why a company must budget, reports generated often explain how they can budget. They do this by analyzing a company’s spending and coming up with solutions that they can use to manage their money more effectively. Forecasts can be very helpful, too. Financial forecasts give CFOs and stakeholders greater insight into predicted company performance. Knowing what the future holds can make running a business considerably less stressful.
Scenario Planning
A very important part of modern business ownership is scenario planning. Business owners need to play for all eventualities and outcomes. If they do not, their companies can end up underperforming. Financial planning and analysis software usually comes with scenario planning tools. However, it’s worth noting that these tools are better on some platforms than others.
Before you invest in a specific piece of software, it’s important to make sure that you conduct extensive online research and find the best program you can. A good way to determine a program’s suitability is to read its feedbacks. Make sure you prioritize independent feedbacks, not ones vetted and authorized by the software seller. Independent feedbacks are a lot more trustworthy because they are rarely biased. A company’s feedbacks will give you insight into the efficacy of their scenario planning tools, as well as other features of their software.
Risk Management
An important part of scenario planning is risk management. Business owners need to know what all the risks posed to them are. If they do not know what risks are inherent in their industry, then they could end up failing to protect themselves in the event they encounter them. A good way to ensure that your business is protected against potential risks is to hire a risk management professional, in addition to using financial planning and analysis software. Risk management professionals will be able to work using the software you have invested in, protecting your company. Bear in mind that you don’t necessarily have to hire a full-time employee; you could just outsource or hire a freelancer. Risk management checks don’t need to be performed daily. You can get away with having them performed once or twice a month, just so you know what current threats are and how your company’s systems are performing.
Online Security
Online security is something you need to give a lot of consideration to. The internet is not a safe place to run a business. Entrepreneurs all over the world are targeted on an almost daily basis by criminals and thieves. If you want to protect your company, then the financial planning and analysis software you invest in needs to come with security features like encryption and two-factor authentication.
Finding software that does come with these features should not be a difficult thing to do. Make sure that before you invest in anything, you reach out to the company and find out what security measures have been built into the program you plan on buying. Also, take time to protect your company’s devices with antivirus software. Antivirus software can repel cyberattacks and keep your business safe, preventing theft and fraud from occurring.
Expense Management
Finally, try to find a financial planning and analysis program that comes with expense management features. Expense management makes budgeting and handling expenses much easier. One of the main features of expense management software is that it allows for expense tracking and reporting. Any expenses can be submitted digitally and immediately logged, which will make accounting and tracking much easier. Reports can also be generated, which can give you insight into spending patterns. Getting a better understanding of how you spend your money can make your life as a business owner much easier. Something else worth noting is that expense management software will flag up unauthorized expenses, which helps to prevent employees from spending company money in ways that they shouldn’t. Your company’s money needs to be carefully managed, so being able to track it in real-time has obvious benefits.
Financial planning and analysis software can do wonders for your business. If you are interested in making an investment in some, consider the points made here. You will be able to find a program that’s right for you by looking for this post’s suggested features.
