Advanced survey shows lack of awareness around effective budgeting and forecasting in public sector
New research commissioned by leading IT software provider, Advanced Business Solutions (Advanced), in partnership with iGov Survey, has revealed almost 50% of public sector organisations still rely on time consuming and unreliable data processing methods to plan their budgets and forecast spend. More than 300 senior finance professionals took part in the poll.
The survey gauged how the wider public sector, including police, fire and ambulance authorities, as well as NHS trusts, local authorities, further education establishments and universities, responded strategically to budgetary pressures and how many were using IT to deliver results more effectively.
In spite of having access to more sophisticated software alternatives, almost half (42%) say they still rely on Excel spreadsheets for their budget preparation, monitoring and forecasting. The research also revealed 49% of respondents spent between three and six months a year on budgeting activity, with 13% spending between six to nine months on the process.
Despite these results, 82% of respondents said they believed their existing budgeting and forecasting methods allowed them to respond effectively and in a timely manner to on-going changes in their budgets. This indicates a real lack of awareness about more efficient, alternative systems available to the public sector.
Dean Dickinson, Managing Director at Advanced Business Solutions, said: “The reality for the public sector is that the full force of the last few years’ cuts are starting to bite, and that more cuts are inevitable. The need to work smarter and manage finances more accurately is therefore greater than ever.
“It’s surprising that Excel spreadsheet working remains the preferred choice, especially when there are more sophisticated systems available which offer access to real time information, and greater visibility and control over budgets.
“Perhaps what is more surprising is that our research shows a significant number still believe their current methods of working are efficient. There is definitely a case for educating finance teams how to manage their budgeting more effectively.”
The Advanced research does, however, suggest senior finance professionals are beginning to look to IT innovation to drive efficiency, with more than half (51%) saying their organisation was planning to review budgeting and forecasting processes in the next year.
A separate survey of CFOs by business analyst firm, Gartner, saw *43% of finance chiefs saying they had plans to invest in budgeting, planning and forecasting solutions in 2014.
The research also highlighted 62% of respondents describe a reduced reliance on spreadsheet working as ‘important’ or ‘very important’, suggesting the days of the Excel approach are finite.
A sizeable 87% said there was a ‘medium to high importance’ around giving budget holders greater control over their finances, and 66% believe greater financial visibility was either ‘important’ or ‘very important going forward’.
Added Dickinson: “With 46% of survey respondents admitting that cuts in the last three years have ‘significantly’ affected their organisation it is surprising that implementing better technology to deliver budget savings has not yet been widespread. There are examples of local authorities making substantial savings following the adoption of new IT solutions and so reducing budget setting timescales from months to just days.”
Cheshire West and Chester Council announced a £1 million budget saving after investing in a real-time budgeting and forecasting solution. The authority began using Advanced’s Collaborative Planning software in January 2012, and a year later the authority had exceeded its original savings target of £500,000.
*Page 10, 2013 Gartner Financial Executives International CFO Technology Study.
Click here to read the full report based on the research.
Notes to editor
About Advanced Business Solutions www.advancedcomputersoftware.com/abs
Advanced Business Solutions (Advanced) provides leading integrated business applications and services that enable public, private and third sector organisations to retain control, improve visibility and gain efficiencies whilst continually improving corporate performance. Advanced prides itself on getting close to its customers by understanding their businesses and responding to their evolving needs.
Advanced’s software systems comprise core accounting/financial management, procurement, supply chain management, human resource and payroll systems, integrated with a range of collaborative, document management and business intelligence solutions to extend the value and effectiveness of the finance, human resource and payroll departments.
Management information systems for school and academies are also provided through Advanced’s subsidiary, Advanced Learning. Advanced also provides specialist vertical solutions for the not-for-profit and legal markets. All solutions can be delivered as a managed or bureau service.
Customers are from both the public and private sectors and include Companies House, Newcastle City Council, NHSScotland, Norfolk Constabulary, Edge Hill University, WH Smith, Royal Bank of Scotland, Aer Lingus, National Express Group, DFS and RSPB.
Advanced Business Solutions is a division of Advanced Computer Software Group plc, a leading supplier of software and IT services to the health, care and business services sectors.
Advanced Computer Software Group
+44(0)1625 856 513
07887 415 232
Advanced Computer Software
Tel: 01625 856 505