Nick Williams examines how it’s now possible to have a truly international finance solution.
When it comes to business, having an international presence is very much the order of the day, with even the smallest of start-ups seeming to ‘go global’ from day one. The rise of the multinational business over the last 20 years has seen the creation of a global marketplace, with companies of all sizes and across all industries taking full advantage of the many and varied benefits that having a global reach can bring. Globalisation has been a real game-changer, enabling businesses to expand into previously unknown territories with great success. It offers the capability to capitalise on increased market opportunities, spread and balance risk across different economies, and increase margins via access to lower cost skills and goods.
But with the shape of Brexit still to be defined, and the all-powerful digital presence of Amazon, Alibaba and eBay driving up pricing pressure and shortening product cycles, the heat is on for all companies with an international presence to increase their business agility to best cope with the volatile markets in which we’re all operating. In order to take full advantage of the benefits that globalisation can bring, while staying one step ahead of the competition, businesses need to maximise economies of scale, making full use of the efficiency savings that are only possible with a global business model.
The businesses who are leading the way are those that are using technology to exploit every feasible cost saving and to identify every new revenue opportunity before anyone else. Nowhere is this more evident than in the area of financials, where it’s more important than ever to have truly global finance systems in place, which not only operate in all currencies but can support varying regulatory and taxation frameworks in every country of the world.
The somewhat patchy reach of IFRS hasn’t managed to remedy the union of the very different financial and reporting processes that vary from region to region, meaning that some businesses are missing out on crucial efficiency savings, while wasting resources and flying blind due to a lack of access to a global, holistic view of financial performance. To fully embrace globalisation in all its glory, businesses need to facilitate consistent, accessible financial reporting across the world.
To date, businesses have had two options. Firstly, either settle for different accounting systems in different countries by bolting together legacy systems – resulting in clunky work-arounds, rekeying data and amalgamating reports, and leading to inevitable errors and time delays. Or they can invest in very costly monolithic systems to support every reporting framework, systems which are then implemented across the globe at great expense, involving hefty customisation, which in itself is costly, complex and extremely time consuming.
However, a new generation of systems has brought a third option to the table. The availability of one system, run from one server, with all local accounting rules built in as standard, all of which can be simply switched off or on as required, has changed the way global businesses operate. These systems automatically implement the necessary rules and processes, making the information available to the entire business in a common format across the system and the globe.
This enables the organisation to take full advantage of all the benefits of a truly global accounting system, providing the comprehensive view of the entire business that’s necessary to identify and exploit every feasible cost saving and revenue opportunity. Plus, the existence of just one system means less admin, lower maintenance, and a lower total cost of ownership, as well as the benefits of everything being updated in a live environment. This helps to create an agile and responsive business, with the right information delivered to the right person at the right time, in the right format.
The ability to bring together all regions without costly customisation, large investments in software or error-prone work-arounds, takes the pain out of multi-national accounting, meaning that businesses can take full advantage of that global competitive edge, without the prohibitive price tags of the last 20 years. With the right tools in place, businesses are well prepared to outperform the competition, even in the most volatile and international of marketplaces.
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