The Challenges with Standard Accounting Software
As organizations expand, the volume of financial data they produce grows exponentially. Standard accounting software like NetSuite and Xero can handle basic bookkeeping tasks effectively, but when it comes to generating insightful, actionable financial reports, they often fall short. This gap is where the prowess of (Business Intelligence) BI tools for finance shines. BI tools like PowerBI, Tableau and Domo are not only capable of connecting to a plethora of data sources but also automate data updates, making them a formidable choice for accurate, up-to-date financial reporting.
Financial reports are the pulse that indicates a business’s financial wellbeing. They offer key insights into crucial performance indicators such as revenue, expenses, profits, and cash flow – all vital for making well-informed business decisions. With a competent BI tool, companies can create bespoke financial reports that align with their unique needs and business frameworks.
Why BI Tools Are a Game-Changer for Financial Reporting
Standard accounting software like NetSuite and Xero may have restricted reporting capabilities, but using a BI tool for finance reporting brings about the power of multi-source data connectivity. For instance, a multinational company with subsidiaries operating under different financial regulations and using diverse accounting software can easily consolidate all their financial data in one place with a BI tool. This consolidation provides a comprehensive view of financial performance, leading to more efficient and precise financial reporting.
Furthermore, BI tools provide the gift of automation for data updates. In contrast to manual report generation that is prone to errors and time-consuming, BI tools can be programmed to automatically pull data from various sources, updating reports in real-time. This automation ensures timely, accurate financial reports – a must-have for informed business decision-making.
Beyond standard financial reports, BI tools also empower organizations to create ad-hoc reports focusing on specific aspects of their financial performance. For instance, a company could generate a report analyzing the profitability of various product lines or customer segments. These reports can be created swiftly, enabling real-time data-driven decision making.
Traditional accounting software often lacks user-friendly interfaces that non-finance stakeholders can easily understand, potentially leading to confusion and misinterpretations. BI dashboards, on the other hand, present financial data in an intuitive, visual format, making it easy for stakeholders to grasp and navigate to find the information they need. This clear representation not only accelerates decision-making but also fosters a unified understanding of financial reporting across all stakeholders.
The Variety of Financial Reports Made Possible by BI Tools
So, what kinds of financial reports can be generated using BI tools? The range is extensive, but here are a few examples:
- Profit and Loss (P&L) Statements: P&L statements offer a glimpse of a company’s revenues, costs, and expenses over a designated period. With a BI tool, companies can enrich P&L statements with additional KPIs such as gross profit margins, operating margins, and net profit margins.
- Cash Flow Statements: Cash flow statements monitor the movement of cash within a business. Using a BI tool, companies can create customized cash flow statements that shed light on their cash position, including operating cash flow and free cash flow.
- Balance Sheets: Balance sheets provide a snapshot of a company’s financial position at a specific point in time. With a BI tool, balance sheets can be enhanced with additional KPIs such as debt-to-equity ratios, current ratios, and quick ratios.
Use Case: The Challenges of Integrating NetSuite with Domo
Integrating NetSuite, a leading accounting software, with Domo, a powerful BI tool, presents a unique set of challenges. While NetSuite excels in handling basic bookkeeping and financial management tasks, our goal was to integrate high level KPIs such as revenue, expenses, EBITDA into the executive dashboards we had already developed in Domo.
The integration process has 2 steps:
– the installation of the Domo bundle in the NetSuite instance, which our friends at bpm.com helped us with
– and the configuration of the connector in Domo.
Despite following the detailed guide from Domo’s support site, the process proved to be trial-and-error.
The connection requires precise inputs for token id, token secret, account id, netsuite script bundle id, netsuite deploy bundle id.
Overcoming Data Sync Inconsistencies
Once the initial setup was completed, we faced another unexpected challenge – inconsistencies in data synchronization. We observed that not all transactions were being relayed to Domo, with some entries missing and others duplicated. This inconsistency varied with each data sync.
We found out that this is related to a bug that Netsuite is well aware of and which as of the time of this writing is still not solved.
So in the end, we adopted a semi-automated approach. After the financial month-end closure, we manually export the saved searches from NetSuite as CSV files. These files are then uploaded to a Dropbox location from which they are then processed by a Python script, which writes the data into a MySQL database. This approach ensured unique identification of each transaction using primary keys and allows us to avoid any discrepancy.
If you find yourself in the same situation and need to build dashboards with Netsuite data in either Domo, PowerBI or Tableau and need help, do not hesitate to reach out to us.
Conclusion
Financial reports are essential for tracking the financial health of a business, and BI tools for finance are the best platform for creating them. With the ability to create customized and dynamic reports, organizations can gain deeper insights into their financial data.
By automating the reporting process, organizations can save time and resources, allowing them to focus on other important areas of their business. Traditional accounting software can be limiting in terms of reporting capabilities, and BI tools offer a more robust solution.
If you would like to see a real world case study of integrated finance reporting built with Domo, read along here.
*the article has been written with the assistance of ChatGPT and the image has been generated using Midjourney
