Assurance Services, Technology Services • Published 3/22/2019 3 Approaches to Attaining Deeper Financial Analytical Insight for Family Offices


The way family offices are gaining deeper financial insight is changing. Traditional financial reporting focuses on results over varying periods of time, where financial statements are the standard deliverable. However, preparation of these statements often takes weeks, not days. For family offices, real-time reporting and analysis has evolved to fill the gaps created by traditional financial reporting, supplementing the content of these reports with operational data. Forward-thinking family office finance teams are embracing the following three approaches to achieve timelier, higher-quality reporting and analysis.

Approach 1: Reduce the Time to Close

The faster close has long been an objective of many family office finance teams as it enables more timely reporting and provides the opportunity to take corrective action sooner. Intuitively, it is recognized that business and the need to make decisions moves more quickly than the month-end close process. The challenge for finance is to find ways to accelerate the dissemination of information without eroding credibility.

Achieving a fast close often requires a change in mindset. Family offices executing a faster close are:

  • Preparing a month-end checklist and cross-training staff;
  • Proactively reconciling and reviewing key accounts on a more frequent basis;
  • Automating processes via the use of technology; and
  • Delegating work outside of the finance function or to an outsourced accounting firm.

Approach 2: Aggregate Data from Multiple Data Sources

Today, modern financial systems address many of the shortcomings of a traditional approach to reporting. These systems enable operational data from outside of the financial system to be integrated into the financial system. This capability is made easier through the use of cloud-based solutions, which eliminates the inefficient hand-offs of information between departments that slow down the ability to report on a single version of the truth. 

Approach 3: Implement Dashboard Reporting

Dashboards are to a family office what cockpit control panels are to a pilot. They are the business equivalent of dials and meters, all designed to provide a user with a snapshot status of the business using key performance indicators (KPIs).

The KPIs should be a mix of financial and non-financial indicators. This means that data originating outside of the financial system may be leveraged with financial data to provide better insight into performance. This may include information such as customer satisfaction, employee turnover, or asset utilization. 

Modern dashboards are interactive for the user and add more value than a static printed report. The true insight comes from a user’s ability to drill into the various metrics on their screen and interact with the underlying data. This data can be sorted, spliced, and drilled further, all the way back to the transactional level, to give users a deeper and richer understanding of the underlying cause and effect of what has happened.

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