COVID-19 has been forcing accounting and finance teams to work remotely since last year, and that’s prompting reexaminations of how to use cloud technology for financial reporting in the future.

A report, released last month by the Institute of Management Accountants and the financial technology company Workiva, surveyed approximately 200 financial reporting professionals on their experiences and found that before the pandemic, their organizations placed a fairly low priority on technology-based financial reporting solutions. Two-thirds indicated they were behind other internal teams in competition for resources. About 30 percent of the respondents expressed interest in a technology-based solution for various activities around the documenting of management review processes and judgment areas. Approximately one out of five respondents said they have changed their prioritization or budgets for technology-based corporate reporting solutions for 2021 and into the post-pandemic period.

The pandemic forced most companies to shift toward a work-from-home environment last year, and that included their accounting department. While many employees have since returned to their offices at many organizations, others are continuing to do their work remotely. Despite the initial challenges, remote technology has mostly helped accounting and finance employees work safely from home, but it has also raised the question of whether companies should continue to rely on cloud technology after the pandemic eventually subsides.

“What we found out is that, not just with the anecdotal information that we were hearing, is that financial reporting teams are able to get the job done during the pandemic,” said Shari Littan, director of corporate reporting research and policy at the IMA, who co-authored the report. “They felt that they had adequate tools for some areas that are more challenging than others. Inventory is one of them. Revenue assessment is another. But by and large, they felt that they could get the job done. What we wanted to know is this going to change your movement toward adoption of more elegant and efficient solutions? And what we found is that there is an appetite for more.”

The survey respondents seemed to prefer new systems for two areas: control ownership and succession, and assessing revenue expectations. “The succession part is really where we’re really seeing some interest,” said Littan. “One thing a cloud-based or collaborative platform can do is automatically assign who is going to oversee what and who is the second in command, someone else who can step in if that person is unavailable because during the pandemic more things are changing fast.”

The respondents from private companies expressed more interest in systems for accounting processes that require estimates and sorting data.

“When you need to access economic data, things are changing very fast and you have to depend on judgment-based estimates in a pandemic environment,” said Littan. “Or if there are climate events like we saw in Texas disrupting the process, things are moving so fast, and you have to get the right data for a decision that’s being assessed. It’s better to have tools rather than going out and finding the right data, stripping it out, because we’re dealing with unstructured data for building the reports. In the scenario of a pandemic or major weather event, you could be dealing with unknowns. You don’t have enough data. You don’t have enough information. You can’t compare to a prior year. Some of your estimates have to be rethought from scratch.”

Accounting and finance teams are increasingly needing to assess such information, including for environmental, social and governance reports.

“There is still a sense at companies that technology for their financial reporting and accounting teams is less of a priority than technology solutions elsewhere in the company,” said Littan. “Yet that’s happening at the same time as we’re asking for more reporting, on ESG for example, more information, and more teams are working remotely.”

Cloud technology can help accountants respond to those needs more quickly. “One of the things we focus on at IMA for people who are on the corporate preparer side is the demand on the professional’s time,” said Littan. “We hear every day how they would like to be more involved, even more than they are now, in strategy, in planning and talent management, in developing business models, all of these other things that we want accounting and finance professionals to be able to do, but they are dedicating so much of their time to compliance and just getting the reports out while there are solutions available to them.”

Cloud-based systems can also help with workflow when building and reviewing reports. “When you’re using this type of software, the reporting requirements are built in, or they can be lined up and compared, so it eliminates that cutting and pasting,” said Littan. “What it also could help with is the management oversight and review process for those last steps of the report because if you’re using that system, it will document who reviewed certain documents and information in order to sign off on the reports’ various aspects, and it will record that. That can be really helpful down the road if there’s ever a look back on how certain decisions were made, what was the review, what was the oversight. That gets preserved. Another helpful aspect when people are working remotely is you don’t have a physical document for signoff. You don’t want documents sitting on 10 different people’s computers and different versions of them. The platform could help assign these things, so it could help with efficiency.”

Cloud technology can be challenging from a cybersecurity standpoint, and it can be difficult in a remote environment to have the proper internal controls in place and the management oversight and review when much of the staff is working remotely. But overall it’s proven to be invaluable for organizations that are forced to operate remotely in this now year-old environment of the pandemic.