NEW YORK--(WeiserMazars LLP, a leading accounting, tax and advisory services firm, today announced the release of its annual 2012 Insurance Finance Leadership Study of Chief Financial Officers (CFOs). This year’s study discovered a significant correlation between high-performing companies and ongoing investment in finance infrastructure. The study found that 66% of high-performing insurance companies (those with Return on Capital higher than 10%) close their books in less than 15 days while only 33% of low performers (those with ROC lower than 10%) met that timeline. Insurance companies making the proper investment in their finance infrastructure used higher quality data, thereby making their departments more efficient and freeing them up to provide more insightful analysis to positively impact business decisions.)--
“We also saw that having a good working relationship between the finance and technology departments is crucial to an insurance company’s success.”
“Our study clearly shows that as finance departments invest more heavily in IT systems and business processes, they can spend less time managing data quality and closing the books and instead focus their efforts on providing analysis that ultimately impacts profitability,” said Michael Flagiello, Partner in the Financial Services Consulting Group. “We also saw that having a good working relationship between the finance and technology departments is crucial to an insurance company’s success.”
More than twice the number of CFOs at high performing companies had a positive relationship with their technology departments, 82% vs. 40% at lower performing organizations. CFOs at high performing companies believed that technology projects were well run and that their technology teams were knowledgeable on how to accommodate the finance department’s needs. At lower performing companies, finance departments had a less positive relationship with IT and found that without significant supervision, their needs were not properly met.
In addition, the study found that 50% of CFOs believe legacy systems significantly impact the quality of data and substantially limit the introduction of new technologies. Over 30% of CFOs reported that at least a $10 million investment is required to shore up their financial infrastructure. Among the reported gaps were a lack of master data management, which creates additional data complexity in otherwise standardized processes, and a lack of integration with systems from acquired companies, which hinders accurate measurement and rapid reporting.
Click on www.weisermazars.com/cfostudy to see the study in its entirety, including other important industry trends.
To see an illustration of the key findings of the WeiserMazars 2012 Insurance Finance Leadership Study and the dichotomy between high performing insurance companies and low performing companies, please visit the accompanying video by clicking on www.weisermazars.com/cfostudy.
About the WeiserMazars 2012 Insurance Finance Leadership Study
The WeiserMazars 2012 Insurance Finance Leadership Study targeted a cross-section of insurance industry CFOs. Admitted P&C (both commercial and personal lines), Excess & Surplus, Reinsurance, and Life and Health companies are all featured in the results. This year’s study focuses on the Finance team’s level of technological preparedness, its relationship with the business, and its relationship to the Board of Directors in terms of risk management and overall effectiveness. WeiserMazars assembled an Advisory Board of current and former Insurance CFOs to formulate relevant topics and to interpret the results. We also engaged C F Effron Company, a boutique independent management consulting company providing primary and secondary research, to provide an analysis of the data for this study.
About WeiserMazars LLP
Since 1921, WeiserMazars LLP has provided a unique combination of foresight and experience when fulfilling client needs in accounting, tax and advisory services. WeiserMazars’ team of over 100 partners and approximately 700 professionals is based out of six U.S. offices, Israel and the Cayman Islands. As the independent U.S. member firm of the Mazars Group – a prominent international accounting, audit, tax and advisory services organization with nearly 14,000 professionals in 69 countries on six continents– WeiserMazars represents clients of all types, including owner-managed businesses, complex, multi-national organizations and high net worth individuals in a multitude of industries.