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Digital Advancements in Finance and Accounting

by Rachin Dewan

Digital advancement is continuously disrupting the financial services industry, pushing insurance organizations towards modernization of their finance and accounting (F&A) functions. From touchless journals to digital reporting, the focus of these initiatives is to reduce cycle time, increase transparency, better manage operational risks, and improve operating efficiency.

A natural progression for finance professionals is to use technology to move away from transactional processing to more analytical and strategic areas, supporting both business growth and cost rationalizations. Anything that is rule-based is naturally brought under the umbrella of robotic process automation (RPA), Artificial Intelligence (AI), and Machine Learning (ML).

Data as a decision-making tool
Real-time financial and business data is critical to enable effective decision-making and performance management. For large, global insurance organizations it is imperative to have such capabilities available to effectively drive business reviews.

As with any data-driven tool, the first step is to ensure the foundational data is well-structured, standardized, and clean. Technologies like ML and AI can help address inconsistencies and improve data integrity. With a combination of refined data models and AI, forward-looking and scenario-based financial information can easily be produced to highlight risks and opportunities in the annual operating plan. Automated machine learning can identify patterns and trends in data more quickly and effectively than human analysts. An efficient and well-thought-through AI system can identify patterns and automatically implement measures to eliminate operational and financial risks to organizations.

The impact of Blockchain technology
A tool that presents a tremendous opportunity in the F&A space, but still requires a lot of work, is Blockchain. A decentralized ledger of transactions across a peer-to-peer network, Blockchain is already revolutionizing and streamlining inter-company payments, cross-border settlements, transaction processing, and real-time verifications of payments. The decentralized network approach improves data security and process transparency while essentially eliminating data tampering, ensuring transactions recorded on the platform are secure and instantly verifiable.

Technology drives payment processing
As technology continues to advance, payment processing is becoming not just faster, but also much less expensive. These same advances are also being applied to the largest payment process – payroll. Whether payments are needed on a predictable cadence or as a single, one-off transaction, smart contracts with vendors, clients, consultants, and customers will ensure improved transparency, timely payments, and effective collection cycles. These intelligent contracts can automatically execute, control, or document legally relevant events and actions according to the terms of a contract or an agreement and then automatically trigger executions related to the financial aspects of that agreement.

How Xceedance Can Help You Transform Your F&A Operations
At Xceedance, transformational leadership within our F&A capability is establishing and driving a culture of innovation, enabling our teams to focus not simply on what can be automated but instead on what should be automated. In collaboration with our data science team, we are also moving up in the value chain with the application of AI. Our finance team is committed to proactively upskilling and transforming its talent pool to enable and support clients’ digital transition efficiently and effectively.

Improving Transparency Through Digital Reporting
The Xceedance F&A team is presently developing a Digital Reporting Hub that intelligently combines AI capabilities to support clients with real-time, self-service management information and related business analytics. This solution will help amplify the sharing of information between key stakeholders to accelerate decision-making.

 Improving processes through workflow automation
Xceedance is also investing in workflow automation capabilities to streamline and enhance F&A processes. This new solution enables insurance organizations to manage their financial close processes with effective workflow functionality, reducing cycle time. When complete, this new capability will also integrate internal process delivery management and governance to improve workflow applications usage and provide additional process visibility across the organization.

Technology is fundamentally changing long-established business practices across the insurance landscape, and the finance department is no exception. If your organization’s F&A processes need to modernize let’s discuss how the solutions from Xceedance can help.

Rachin Dewan is VP – F&A program management at Xceedance. 

December 13, 2022