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When it comes to finance transformation, Polish CFOs still have a lot to catch up on according to new research

New report published by PwC in partnership with AICPA & CIMA investigates the maturity level of finance functions in Poland

31 January 2022, Warsaw – Only 14% of companies in Poland have a modern and mature finance function that gives the business a competitive advantage. And even the finance leaders of the most advanced finance functions have gaps to fill in areas such as business partnering, management reporting, planning, budgeting and forecasting, automation, IT development strategy and digitals skills development according to the PwC CFO Compass Survey 2021. The Association of International Certified Professional Accountants (the Association), representing the American Institute of CPAs (AICPA) and The Chartered Institute of Management Accountants (CIMA) was the official report partner.

The survey results indicate that, for the majority of respondents, the finance function is still mainly seen as the area of traditional accounting and management reporting, often limited to cost monitoring. Forward-looking areas and competence centres using the latest technologies still constitute a small percentage in the structure of the finance function within Polish companies.

And while processes such as management reporting or planning and budgeting have been implemented and are functioning adequately, the relatively low level of automation of these processes means that the maturity of the finance function still hasn’t been achieved. 

When analysing the results of the survey in terms of the support that the finance function can offer to the business, it becomes clear that for the majority of respondents it’s based on the analysis of historical data. Finance continues to focus on reporting on what happened, rather than what will happen. Only one in five respondents can provide reports for signalling risks and opportunities. What’s more, the tendency to produce standardised reports and forecasts still prevails whereas today, the business expects much more from a CFO,” – says Mariusz Dziurdzia, Partner at PwC Polska, Leader of CFO Compass Program. 

Only 9% of CFOs declared that they have a fully automated management information reporting process and as little as 5% of CFOs said that they have a fully automated budgeting process based on integrated tools that enable parallel planning of multiple areas (support and business functions). 

We now live in a time of dynamic change, with highly competitive markets and significant business uncertainty. At the same time, the digital revolution is changing the way organisations operate and the way they respond to the increasingly demanding needs of their stakeholders. Recent years have also shown the importance of the CFO’s role in organisations – over the years, CFOs have become the cornerstone of organisations’ decision-making. However, to keep up with growing stakeholder demands and to succeed, CFOs need to modify their strategies,” – says Katarzyna Podgórna, Partner at PwC Polska, Leader of the “Finance of the Future” Initiative. 

There are many items on the list of tasks awaiting implementation by the finance function, ranging from new technology, through talent acquisition and retention to ESG reporting. Only one-fifth of businesses (21%) have implemented process automation and RPA, and 86% are yet to use AI or machine learning. Meanwhile, only 20% of the respondents indicated that their finance teams are familiar with and make full or advanced use of the functionalities of new technologies for process automation. 81% of CFOs have said that they plan to bridge the gap between the existing digital skills of their finance teams and the digital ambition of their businesses through development programs or employee training. 

In this competitive world, finance skills alone are no longer enough. 98% of finance leaders look for experience in new technologies and finance process automation when recruiting. If finance professionals are to remain relevant in the digital world, they must change their traditional, number-focused, skillset. Finance leaders, in turn, must ensure that their teams have the appropriate competencies to enable them to create value and operate in an increasingly flexible environment, while at the same time identifying and mitigating potential threats,” – says Jakub Bejnarowicz, Regional Director for Europe at the Association of International Certified Professional Accountants, representing AICPA & CIMA.  

Three-quarters (73%) of businesses are not ready to adopt ESG reporting, with lack of tools, knowledge, and senior leadership buy-in cited as factors. Two-thirds (63%) have not engaged with the Sustainable Development Goals,” – points out Piotr Rówiński, Partner at PwC Polska. 

According to the report, CFOs plan to focus on the following key areas over the next two years: 

  • Implementing consistent processes and tools for planning and budgeting within their organisations;
  • Shortening the preparation time of their monthly management reports to two days at most;
  • Aligning staff competencies with the challenges of technological development and automation; and
  • Developing their finance automation processes further.

Read the full report here.