Only a small percentage of companies or about 27% of them are confident that their finance teams can be fully trusted in tracking potential errors in ensuring their financial reports are spotless.
According to a survey released by BlackLine, Inc., an automation software provider, seven out of 10 Singaporean high-ranking business executives and finance experts think that their firms have made major business decisions from inaccurate information.
The recent survey cited around half or 45% of the respondents claimed that inaccurate data analysis is a prevalent and continuing dilemma among companies.
The poll consisted of about 1,100 senior executives and financial experts. From this population, 100 respondents were from Singapore.
Also, the survey revealed that about one in five or 19% of Singaporean high-ranking executives and finance practitioners are less confident in tracking mistakes in their financial reports.
From these findings, less than half or 40% of the top executives in the survey were completely relying on their financial data accuracy. For the finance professionals, the percentage was even lower at 32%.
For those executives who trust their finance team, only 27% of the respondents claimed to give their full trust to their experts and their CFOs’ capacity to spot all potential discrepancies while ensuring the accuracy of their reporting.
Several reasons cited for the causes of reporting mistakes were human error (51%), collection and data processing complexity (50%), and many data sources (40%). All these factors contributed to the lack of trust in financial reporting.
In a statement, Mario Spanicciati, BlackLine’s chief strategy officer, noted it is alarming that many companies are lacking the confidence to spot errors and provide accurate reporting.
He stressed the high incidences of misreporting scandals in the headlines could simply be the tip of the iceberg reflecting a bigger problem within the financial industry.
He added, apparently, the reporting errors are very common. There is a huge possibility that many other inaccurate reports are sent unnoticed within the organisations.
The survey highlighted that 62% of Singaporean respondents noted that some of the firms they have worked with had to recompute their earnings brought by errors in the financial data that were unidentified before being reported.
BlackLine noted most global organisations are continuously tracing their financial errors in their accounts.
The software provider added among the 22% of the total cases, the C-suite respondents take 10 days of review per month to track errors and do necessary modifications in their financial reports. This means a waste of 120 days annually simply on checking inaccuracies and mistakes in the company’s records.