5 things that keepcomptrollers up at night

In early 2016, the National Association of State Auditors,

Comptrollers, and Treasurers surveyed members across all

50 states about their current processes for the developing

the Comprehensive Annual Financial Report (CAFR).

The survey sought to provide state comptrollers with an

opportunity to voice the top barriers, technology

applications, and staff concerns associated with the

preparation of the CAFR each year.

These are the top 5 concerns

raised by survey respondents

about CAFR reporting.

1 FUTURE STATE OF FINANCIAL REPORTING

54% of survey respondents said

they were somewhat or very

concerned about the accuracy of

their current CAFR, while nearly

79% expressed concerned about

future accuracy.

EXPRESSEDCONCERNED

1 FUTURE STATE OF FINANCIAL REPORTING

These numbers reveal a need for a close consideration of current processes, and more importantly, a sense of urgency about finding solutions to the increasing challenges in the near future.

EXPRESSEDCONCERNED

2 GETTING ALL THE DATA

96% of respondents stated that

they gather data from more than

16 individual sources, ranking

data collection as one of the

most time-consuming steps in

the CAFR process.

STEPS ARE TOOTIME-CONSUMING

2 GETTING ALL THE DATA

Gathering information from third parties was reported as one of the biggest worries for survey respondents.

Collecting unstructured data provides opportunity for errors in data accuracy and possible security issues.

STEPS ARE TOOTIME-CONSUMING

3 DATA ACCURACY

A concerning 75% of

respondents said they found

errors in their CAFRs—a clear

symptom of a process in need

of improvement.

FOUND ERRORS

3 DATA ACCURACY

FOUND ERRORS

Errors in CAFR data are most often a result of adjustments or late revisions to numbers from component units, errors in fund roll-up, and inaccurately reported capital assets.

Across all instances, the common factor in these errors is a reliance on manual processes for gathering and entering data.

4 INCREASING LEGISLATION

The DATA Act is coming, and with it

will come new reporting requirements

for already overburdened financial

reporting teams.

Wisely, over 66% of respondents

reported being somewhat to very

concerned about the looming

legislation.

CONCERNED

4 INCREASING LEGISLATION

CONCERNED

The impact from the 2018 rollout of DATA Act requirements will trickle down to the state and local level in many ways.

One of the most pressing concerns for CAFR teams is being able to manage compliance with reporting and disclosure requirements for new GASB standards.

5 HAVING THE RIGHT TOOLS FOR THE JOB

One of the top 5 barriers to producing a quality and timely CAFR

is the technology used to gather the data and produce the report.

Here are tools being used.

They prevent timely audit, openingthe door for reporting errors.

Excel and Word are a registered trademark of Microsoft Corporation in the United States and/or other countries

To gather To compile To reviewExcel Email Excel Word Excel Email

96% 78% 96% 89% 75% 64%

Microsoft®

Word and Excel, while the most widely-used tools in the

CAFR process for compiling charts and tables, are not meant to speak

to each other—requiring hours of manual transposing and grouping

information from document to document.

Excel and Word are a registered trademark of Microsoft Corporation in the United States and/or other countries

Having the right tools for the job

A close analysis of this information

reveals agencies need to start

taking action to improve their

processes in order to meet the

challenges ahead.

The results of the survey indicate a

consistent theme—a technology

solution that provides a single,

collaborative work space would

alleviate all of these challenges.

Where to go from here

?

Most respondents stated that

the best solution would

address problems with

ineffective tools and

technology, which would also

increase the effectiveness of

their workflow processes.

The ideal solution

The full surveyA close consideration of the results covered in the survey can serve as a good starting point for agencies of any size or type to begin identifying how to improve their CAFR processes and prepare for future challenges. The survey also provides input from respondents on characteristics to look for in a technology solution.

Click here to get your copy of the 2016 Survey of State Comptrollersand Their CAFR Processes.