
Sapling Financial Consultants was delighted to facilitate an interactive webinar with members of FEI Canada’s, Toronto Chapter to discuss best practices, common pitfalls and emerging trends across the various responsibilities of the Financial Planning & Analysis (FP&A) functions.
The session started with an overview of the key responsibilities of the FP&A function, being: Annual Budgeting, Periodic Re-Forecasting, Monthly/Quarterly Analysis, Implementing Business Intelligence (BI) Tools and Dashboard Reports and Building Financial Models and Strategic Analyses. Within each, Sapling presented best practices and common pitfalls, based on our experience, before breaking out into groups to open the floor to the audience to better understand their perspectives.
Best Practices for Effective FP&A:
The findings of the discussion are summarized below:
#1 Annual Budgeting
For FP&A teams, budgeting remains one of the most challenging areas, particularly for smaller organizations that lack the resources for rolling forecasts or in-depth financial analysis. These organizations often resort to real-time, client-driven budgeting, which can make long-term strategic planning difficult. Larger companies, despite having access to advanced tools, struggle to align budgets with their goals, often hindered by gaps in communication and processes that may fail to integrate operational and strategic priorities seamlessly. Successful teams would start the process early, have clearly defined lines of communication and meet regularly to ensure everyone is aligned.
#2 Analyzing Monthly/Quarterly Reporting
Frequent, periodic reporting is another critical function for FP&A teams. Many financial executives express frustration with the inefficiencies in monthly or quarterly analysis, as delays and resource constraints slow down the delivery of accurate actionable insights. Simple metrics and scorecards often lack the depth needed to guide meaningful decisions, emphasizing the importance of systems that can flag significant changes and provide explanatory details. The inability to quickly produce accurate and relevant reports creates pressure on teams to meet leadership expectations while maintaining high standards of data quality. High performing teams have strong templates in place that can automate the bulk of the data aggregation required, so that professionals can focus their time on deep analysis.
#3 Implementing BI Tools, Dashboards, and KPI Monitoring
Modern FP&A teams are now being tasked with building BI tools and dashboards for organizational use. Organizations often face challenges like disorganized data and capacity constraints when deciding to start their business intelligence journey. We discussed the importance of beginning the journey in the Excel environment, so that reports can be tweaked and iterated upon, and the calculations can be workshopped in a familiar environment. Once data issues are resolved, and there is alignment on the desired approach, the switch to migrate reporting into a BI environment is much smoother.
#4 Building Financial Models for Strategic Decisions
Some ad hoc, one-time analyses require financial modelling to help evaluate. This work often falls to the FP&A team, but often teams struggle with a lack of internal financial modelling skills or making models which are too complex for decision makers to fully understand. Teams will have the most success when they dedicate time up-front to plan out the required level of complexity, and the inputs and drivers required which will feed into the model.
#5 Emerging Trends in FP&A
A world-class FP&A team is always keeping on-top of emerging trends to understand how they can constantly expand and improve. There are several emerging trends within the FP&A space, ranging from adoption of BI systems at smaller organizations, the shift to predictive analytics, implementing machine learning algorithms and artificial intelligence, and emphasizing real-time reporting.
The interactive session was a great opportunity for Sapling to present our insights from working with clients in a diverse range of industries, as well as have the opportunity for knowledge sharing among Toronto chapter members.