Blockchain is an emerging technology that allows data to be stored in a distributed ledger and continuously verified by network nodes that secure and process block transactions. Because a blockchain records all transactions between a company and its vendors and customers, it creates an immutable record of transactions without the need for third-party validation.
What does this mean for the CFO?
Today, every order-to-cash (OTC), record-to-report (RTR) and purchase-to-pay (PTP) transaction necessitates one set of verification records on the seller side and another set on the buyer side. This means both companies have versions of order confirmations, receipt verifications, discrepancy follow-ups and payment verifications. Blockchain allows a buyer and a seller to share the same version of the transaction, improving transparency in the F&A function and eliminating clearing requirements. For F&A leaders who oversee these processes, blockchain offers the potential for increased data integrity, instantaneous or significantly quicker reconciliations, reduction in close time, increased audit efficiency and improved real-time financial information.
This ISG white paper How Should a CFO Think about the Potential for Blockchain in Finance & Accounting? explores how blockchain will impact F&A – and how an organization might determine its needs for this new technology.
About the authors
Mr. Furlong is a Partner at ISG and has over 25 years of experience in assisting companies transform their general and administrative functions including finance and accounting, human resources, and procurement. He has expertise in formulating strategies and designing alternative service delivery models (Global Business Services, shared services and outsourcing), transforming processes, driving organizational change, and implementing emerging technologies such as advanced analytics, mobile solutions, cognitive computing and cloud based solutions. Mr. Furlong leads ISG’s Business Advisory Services practice and serves on the Americas Leadership team.
Dave Houston is a Director at ISG and has over 20 years of experience in assisting companies transform their general and administrative functions including finance and accounting, human resources, and procurement. He has expertise in formulating strategies and designing alternative service delivery models (Global Business Services, shared services and outsourcing), transforming processes, driving organizational change, and implementing emerging technologies such as advanced analytics, robotic process automation and cloud based solutions.
About the author
Scott Furlong
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