Bringing analytics to life
The use of analytics has been recognized as a crucial part of any
decision-making process in businesses. The explosion in transactional
and nontransactional data that organizations have access to has made
the need for new tools and technologies vital for organizational success.
As such, finance professionals need to develop knowledge about
analytics to understand and embrace the potential value of Big Data. A
recent report by the Chartered Institute of Management Accountants and
Infosys articulates how analytics can be integrated into the accounts
receivable (AR) process to generate business-relevant insights that
can help to improve decision-making.
Leveraging analytics within AR can provide organizations with a
better understanding of their exposure through segmentation of their
AR portfolio. This could lead to more effective collections and
dispute strategies, thus improving cash flow and reducing nonpayment.
Analytics could also provide insight into customer behavior that can
result in bolder market-entry strategies with less risk to the organization.
As organizations move from descriptive analytics, which merely
describe what happened, to more forward-looking predictive analytics
and prescriptive analytics, more significant business benefits will
begin to be realized. Business leaders need to have a clear analytics
strategy that articulates key priorities and pathways from insights to
business outcomes. This will lead to actionable insights. Without
this, any analytics initiatives will fail to deliver the anticipated insights.
How to maximize analytics
A successful analytics framework needs to ensure that insights are
action-focused and clearly identify the root causes of an issue. To
maximize the value of analytics investments, organizations need to:
Practical steps for implementation include:
Management accountants are well-positioned to ensure that the right
decisions are made to ensure success. By engaging in conversations
around the analytics and ensuring business problems are articulated
correctly, management accountants can ensure the data analyzed are
relevant and that actionable insights are communicated in a relevant
and influential manner.
The original version of this article, “5 Steps to Bringing Analytics
to Life,” by Tarisai Masamvu, is available at tinyurl.com/pansnoy.
—Jack Hagel, editorial director, CGMA Magazine
Also at cgmamagazine.org
Internal auditors more satisfied with incentive pay
Internal auditors who receive incentives based on profits or revenue
report higher job satisfaction and loyalty to their organizations
without having their objectivity compromised, according to research
published by the Institute of Internal Auditors Research Foundation.
Among the 1,600 internal auditors who responded to the survey
conducted in North America, about 50% of chief audit executives, 56%
of directors of internal audit, 48% of audit managers, and 39% of
audit staff receive profit- or revenue-based bonuses.
On a scale of 1 to 5, those who receive profit- or revenue-based
incentives rated their job satisfaction at 3.94, compared with 3.85
for those who do not receive incentives.
The full version of this article, “Internal Auditors’ Job
Satisfaction Higher With Incentive Pay, Survey Finds,” is available at
Accounting salaries projected to rise again
Starting salaries for accounting and finance professionals in the
United States and Canada across a wide range of positions are expected
to trend upward again in 2015, according to forecasts in salary guides
published by staffing services firm Robert Half.
Average starting salaries for corporate accounting positions are
projected to rise between 2.9% and 4.4% in the United States,
depending on the specific role. Increases of 2.7% to 3.9% are
predicted for public accounting positions.
Overall, a 3.5% rise in starting salaries is predicted for
accounting and finance positions in the United States.
Higher-than-average starting salary increases are predicted for staff
accountants, senior financial analysts, and business systems
analysts—jobs that are in strong demand.
The full version of this article, “Continued Rise Projected for
Accounting Salaries in 2015,” is available at tinyurl.com/qddfgyz.
CGMA Magazine is published in conjunction with the Chartered
Global Management Accountant designation, which was created through a
partnership between the AICPA and CIMA. The magazine offers news and
feature articles focused on elevating and emphasizing management
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