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Risk Management

Protecting Data a Top Priority for Execs

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September 28, 2018

Protiviti: Data issues top list of priorities for finance executives

Distributed ledgerData ranks highest among corporate finance executives’ priorities, with security and privacy in financial applications topping the list, according to consultancy Protiviti’s 2018 Finance Trends Survey. These are followed by enhanced data analytics, and improving process and data analytics. Robotic process automation and blockchain, although hot topics in recent NeuGroup meetings, rank only above virtual currencies in the 16-item list of priorities among CFOs and VPs of finance.

While relatively few breaches of data at large corporations have made the headlines this year, 75% of surveyed finance executives nevertheless marked data security and privacy as their top priority.

“One of the worst systems that can be breached is cash management and other functions where the company could lose cash,” said Chris Wright, managing director who leads Protiviti’s business performance improvement practice. “That security parameter within the treasury context is probably the most closely watched one by a finance department.”

Protiviti notes in its survey report that while data security and privacy is a priority across organizations of diverse sizes by revenue, it’s high among those with those between $10 billion and $19.99 billion in revenue (84%) and above $20 billion (74%).

Enhanced data analytics is the next highest priority, with 62% of top finance executives choosing it. Financial planning and analysis increasingly relies on treasury to assist with cash-flow forecasts, not only to support operations but also transactions including M&A, and the data must be high quality.

“Do we have cash for the next acquisition, or do we need to go to the equity or debt markets?” Mr. Wright said. “When debt is incurred, there’s often a hedging strategy. So, finance needs to understand not only the cash flows but the direction of the cash flows and the location, if there’s an FX component.”

Enhancing data analytics requires managing data quality, and to this end data governance is critical, Protiviti says. It adds that master data management also benefits data quality, bringing together data siloed in different systems so top finance executives can query it directly.

The survey notes, however, that data visualization is not among respondents’ top priorities, ranking 8th, but that may be because organizations are currently focused on improving data quality and building analytical capabilities.

The report says that as organizations improve their knowledge and capabilities around data management and analytics, the focus on data visualization will likely increase.

“Dashboards are only as good as the data behind them,” Mr. Wright said. “People are looking for that master data center, where all the data resides so it can be mined, rather than finance staff having to generate reports.”

In a survey of the NeuGroup’s Foreign Exchange Managers’ Peer Group, 48% of respondents said they already have dashboards, and half of the remainder anticipate developing one within a year.

RPA and blockchain technology were at the bottom of the priority list, with only 20% voting for RAP and 14% for blockchain. Mr. Wright acknowledge the low percentages but said the emerging technologies nevertheless have generated enough interest that top finance executives are considering them.

“RPA, because of its practical applications, will gain more of a foothold as people share success stories,” Mr. Wright said.

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