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Financial intelligence

What is financial intelligence?


There are two ways to define ‘financial intelligence’. One is technological, and the other is theoretical.


Technological “Financial Intelligence”

When we define “financial intelligence” at CCH Tagetik, we’re referring to how our technology has the built-in, automated, and specific functions that finance needs to make better, more informed decisions.

What does that look like? Financial intelligence refers to our software’s ability to:


  • Retain original currency information
  • Match currency data
  • Retain interest data
  • Use double-entry accounting logic
  • Translate currencies
  • Perform manage, legal and regulatory roll-ups
  • Establish time-dependent hierarchies 
  • Perform intercompany eliminations, matching, and reconciliation
  • Run multiple consolidations according to different reporting standards on the same dataset, all while preserving the original data

Using automation explicitly designed for financial and accounting processes, finance can more efficiently report, disclose and distill insights out of corporate performance data.


Theorical “Financial Intelligence”

Financial intelligence commonly refers to the ability of executives’ and employees’ to understand and execute on accounting principles. Under this notion, executives and employees who are not formally educated in finance or accounting still need to understand basic finance principles. This is so when they encounter accounting information, they can discern the best course of action to take. 

From theory to real-world application, B2BCFO summarized financial intelligence’s four main attributes:


  • The Foundation: Decision makers must understand how to read basic financial documents. These include the income statement, balance sheet, and cash flow statement. All executives should understand the difference between cash and profit and why the balance sheet is balanced… or if it’s not.
  • The Art: One-part art, one-part science, financial intelligence implies that decision makers have an understanding of when assumptions have been applied and how those assumptions can lead to different conclusions. 
  • Analysis: Decision makers can meaningfully analyze the numbers. They can calculate profitability, leverage, and liquidity. 
  • The Big Picture: Decision makers can understand what the numbers mean when placed in context with the economy, competitors, regulations, and changing customer needs. 

The Benefit of Financial Intelligence

In his book, “The Practice of Management”, Peter Drucker described the benefit of financial intelligence as this: if everyone understands what the numbers mean as well as the overall goals of the organization, then they’ll act in a way that will improve financial standing. Likewise, when it comes to technology, if everyone can use financial performance data efficiently, the path to improving financial standing and making better business decisions is clear.


finance transformation platform