Accounting has undergone a seismic shift over the last five years. The days when accounting primarily meant manual data entry and sifting through heaps of invoices are waning. Today, accounting professional services instead rely on technology to handle many of the tasks that used to require hours of manual labor. Among these tech tools, data extraction software has become indispensable because the quality of work depends on having thorough, reliable, accurate, and secure data that your team can work with. Here’s how financial data extraction is essential for a variety of accounting services:
Client Accounting Services (CAS)
CAS and outsourced accounting teams provide a multitude of services ranging from basic bookkeeping all the way to CFO-level services. CAS teams may be performing month-end close one day or converting a new client into their preferred ERP the next. Regardless of the task at hand, it will require a deep dive into a client’s financial operations.
Here’s how financial data extraction software benefits CAS teams:
Streamlined Reporting Saves Time: When CAS professionals can extract data from client systems automatically, it reduces the amount of time needed each month or quarter to generate reports. This not only saves time but also ensures consistency in data handling.
Standardized Processes for Scaling: Having a centralized extraction tool that can make the assessment, migration, and/or reporting processes standardized makes it much easier for firms to predict time needed for projects, to better staff projects, and to take on more clients. These factors all contribute to faster growth and improved margins.
Deeper Insights for Clients: With less time spent on extraction, CAS professionals can instead focus on analyzing their client’s data to offer more meaningful insights into how their clients can better run their businesses.
Audit teams fight a constant battle to get needed information to complete their audits. This creates a contentious relationship between the auditor and their client, who frequently have full plates and may not fully understand exactly what the auditor is asking of them. At its core, the audit process is about verifying financial statements to ensure their accuracy and fairness.
Data extraction software helps auditors accomplish this goal by:
Comprehensive Data: Traditional audits often relied on sample data for verification. With modern data extraction techniques, however, it’s feasible to analyze much larger datasets or even entire databases. This provides a more holistic view and reduces the risk of oversight.
Improved Relationships: Strongbox can deliver 80% of the PBC (“Provided by Client”) Request List in an audit. Without this tool, clients must manually produce the needed reports, even if the client isn’t sure what the report they’re being asked to produce is. Incomplete reports require the auditor to go back to an already frustrated client to ask for more. Strongbox delivers all the data, in the needed format, the first time, eliminating the contentious back-and-forth.
Better Staffing: When data gets delivered on time and in the right format, there’s less sitting around and waiting by the audit team. This enables leadership to better predict time needed for engagements and staff those engagements accordingly so their teams can enjoy a better work-life balance during busy season.
Financial Due Diligence (FDD)
Many accounting firms have transaction advisory services (“TAS”) teams that offer guidance to buyers and sellers during a merger or acquisition. By performing high quality financial due diligence, these teams paint an independent financial picture of a target company, ensuring or pointing out any skeletons hiding in the closet. In order to provide this service, TAS teams must have complete, accurate data, fast!
Data extraction software enables these teams to access the financial information contained in an accounting system of a target business. Strongbox delivers all the target’s financial information directly into Excel, where TAS teams can then perform their detailed analysis and diligence.
TAS teams benefit from financial data extraction software by:
Accelerated Analysis: FDD projects are on tight timelines. Buyers and sellers need to know right away if there are concerns before they can proceed with the deal. If a target is slow to submit information or a team isn’t fully staffed, there’s no luxury of extending the deadline. Instead, teams have to burn the candle at both ends to complete all the needed analysis on time. With Strongbox, all the financial data gets delivered instantly without having to wait for the needed reports.
Improved Accuracy: Automated tools reduce human errors that can otherwise creep into the due diligence process. Manually inputting data into Excel can lead to mistakes and typos, while data extraction software delivers error-free information every time.
The Added Benefit of Excel in Data Extraction
Data extraction by itself is ineffective unless the data is delivered in a way that is useful for the various teams relying on it. For accountants, whether they be in FDD or Audit, the place where they need their financial data delivered is the same: Excel. Excel is the universal tool that gives accounting professionals powerful analysis functionality.
Strongbox delivers financial data from accounting systems straight to Excel. Since Strongbox was built by accountants, for accountants, the data is delivered in the format needed most by each practice area. With custom outputs for audit, FDD, CAS, and more, the Strongbox Excel workbook eliminates hours of manual manipulation while improving accuracy and completeness. Because the data is delivered in Excel, Strongbox is easy for teams to work into their existing processes.
Try Strongbox Today
Financial data extraction software, in many ways, is the unsung hero of modern accounting. It’s the engine that powers efficiency, accuracy, and deeper insights. As FDD, CAS, and Audit all continue to evolve, professionals in these areas must recognize and harness the power of data extraction, not just as a technological tool, but as a necessary asset needed for a firm to grow and scale. Contact us today to find out more about how firms from the Big 4 to regional firms have embraced data extraction technology with Strongbox.