Robert Kugel's Analyst Perspectives

Real Estate Isn’t Just a Fixed Cost

Posted by Robert Kugel on Oct 12, 2018 6:00:00 AM

Financial analysts typically classify real estate as a fixed cost. Strictly speaking, that’s correct, but looking at it this way leads many organizations to overlook opportunities to more carefully manage their real estate and other occupancy expenses. The changes in lease accounting that are going into effect have caused some organizations to reexamine their leasing policies and how they organize their lease accounting processes. They should take an even broader approach and consider ways to improve how they manage those leases.

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Topics: Office of Finance, Continuous Planning, ERP and Continuous Accounting, Financial Performance Management, Operations & Supply Chain, Lease Accounting, Accounting, IFRS16, ASC842

Warning: Software Now Mandatory for Lease Accounting

Posted by Robert Kugel on Apr 16, 2018 1:00:00 PM

Accountants love electronic spreadsheets – and for good reason. They’re a powerful and versatile personal productivity tool and just about everyone knows how to use them. Spreadsheets are the default software tool for accountants because they enable autonomy (you don’t need to ask IT for anything) and they’re free (so you don’t have to make a business case to authorize buying something). Some accountants humorously (but earnestly) invoke the line “you’ll have to pry this spreadsheet from my cold, dead hands” whenever somebody suggests eliminating them.

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Topics: Office of Finance, ERP and Continuous Accounting, Financial Performance Management, Lease Accounting, revenue recognition, Enterprise Resource Planning, ERP, Continuous Accounting, ASC842, IFRS16, Controller, FASB, IASB, CFO, real estate, Lease Management, leasing, Accounting, Spreadsheets

The Modern Finance Organization is a Technology Fast Follower

Posted by Robert Kugel on Mar 15, 2018 10:08:14 AM

Robots of the physical sort are not about to take over finance and accounting but we have arrived at the age of “Robotic Finance”. I coined this term to focus on four key technologies with transformative capabilities: artificial intelligence and machine learning, robotic process automation, bots and natural language processing and blockchain distributed ledger technology. Embracing these technologies will enable any department to redefine itself as a forward-looking strategic partner to the rest of the company.

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Topics: robotic finance, AI, Artificial intelligence, Machine Learning, bots, blockchain, Robotic Process Automation, close, closing, Accounting

Welcome to the Age of Robotic Finance

Posted by Robert Kugel on Dec 29, 2017 5:24:49 AM

For several years, I’ve commented on a range of emerging technologies that will have a profound impact on white-collar work in the coming decade. I’ve now coined the term “Robotic finance” to describe this emerging focus, which includes four key areas of technology: Artificial intelligence (AI) and machine learning (ML), robotic process automation (RPA), bots utilizing natural language processing, and blockchain distributed ledger technology (DLT), each of which I describe below. Robotic finance will have a disproportionate impact on finance and accounting departments: I estimate that adoption of these technologies potentially will eliminate one-third of the accounting department’s workload within a decade.

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Topics: CFO, ERP, AI, Machine Learning, Robotic Process Automation, Consolidation, Accounting, close, blockchain, natural language processing, Continuous Accounting, Reconciliation

Robotic Process Automation is a Cornerstone of Digital Finance

Posted by Robert Kugel on Dec 25, 2017 7:52:13 AM

Robotic process automation (RPA) relies on programming or the application of analytical algorithms to execute the most appropriate action in an automated workflow. RPA enables business users to configure a “robot” (actually, computer software) to interact with applications or data sources to process a transaction, move or manipulate data, communicate with other digital systems and manage machine-to-machine and man-to-machine interactions. This technology is gaining increasing notice by finance departments, with good reason: RPA represents an important step beyond simple process automation in that it uses software to execute routine but complex workflows that require judgment. Rather than making an individual check-off a step in a routine approval, a robotic system applies an algorithm that decides the next step. The system thus does what people spend an awful lot of their time doing every day: making judgments that most of the time could be done by a machine.

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Topics: Robotic Process Automation, automation, Continuous Accounting, Accounting, Operations, finance, web crawler, bank, banking, legacy systems, close, closing

Artificial Intelligence and Machine Learning in Business Applications

Posted by Robert Kugel on Oct 26, 2017 7:18:56 AM

The application of artificial intelligence (AI) and machine learning (ML) to business computing will have a profound impact on white collar professions. This is especially true in heavily rules-based functions such as accounting. Companies recognize the transformational potential of AI and ML, but the progression and pace of the adoption of these technologies is unclear. Some applications of AI and ML are already in use but others are a decade or more away from replacing human tasks.

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Topics: Accounting, AICPA, AI, Machine Learning, natural language processing, Office of Finance, finance, CFO, CEO, Analytics, Big Data