Back then it was simply easier than exporting the data. Even in today’s world you see the mistakes of the past creeping in. Whereas previously large amounts of business logic was built into Excel workbooks, today it’s into tools like Power BI. As with Excel, this is fine until copies are made, new versions pop up and things spiral out of control.

Applying this outdated strategy to the big data volumes consumed by accounting firms today would significantly exacerbate the problems caused – if it were even possible to do so.

To get real value for your practice, you need to analyse that data and use it. Wasted data is not only a disservice to your accounting firm, it could be detrimental to your long-term success.

To realise the true benefits of data, here are the key steps to building data governance in your accounting firm.

What is data governance in accounting?

In essence, data governance in accounting is merely a term given to the processes an accounting business uses to formally manage their data assets. How those processes are defined will depend on your practice and the types of data your accounting firm wishes to analyse.

However, the governance structure will ultimately advise your team about who can take certain actions, the type of data they can access, when they can do it, as well as in what situations.

Data governance enables the proactive management of your company’s data. It doesn’t matter whether you’re a multinational trying to manage various data lakes, or an accounting practice trying to handle your own big data – the right governance framework is essential to improved outcomes.

Having governance over key business and client metrics also means the delivery can be through whatever method fits your requirements – however outdated it may be. Furthermore, it ensures that any new layers of
analytics added to the centralised data is done so with the knowledge that the starting point is sound.

How to set up data governance in your accounting practice

Below are the seven steps to creating data governance within your accounting firm.

1. Assign a leader

As much as collaboration is the buzzword of modern accounting practices, major business transitions need a leader – or leadership team – to steer the ship.

In the best-case scenario, your practice will have an on-site IT department that can manage the development of your data governance program from start to finish.

However, it may be equally wise to pick a leader who is somewhat removed from the ins and outs of analysing data. Your CFO, for example, will look at the data as an asset rather than just a responsibility.

2. Conduct an audit

Your practice is probably already using data in many different ways – even if you’re not deriving all of its value. So, the next step is to review your processes to find out what sort of data governance structures you already have in place, no matter how bare bones. Common things may be that you have a system for information management. Once you know what you have, you can start uncovering what you need.

3. Get buy-in from your team

This may be the most difficult assignment of them all. Change isn’t always looked upon happily, especially in a practice that has been doing the same thing for a long time. But you need your data governance leader to give your people a vision of the future: with the right data-driven processes, they will be able to work smarter, not harder. The practice itself will also have an incredible amount of information to draw on to streamline operations and give your clients exactly what they want.

4. Get everything aligned

Now it’s time to align your idea for data governance with everything else in your practice. For example, because you ultimately want to create profits, you’ll need to develop a financial value statement for the data governance program, as well as how you will measure it against KPIs. The key here is to document everything relevant – this will allow you to set the baseline performance metrics for your program so you can measure its impact over the short and long term.

5. Define the functions and processes

Time to design your program’s functions and processes. What do you want your data governance program to accomplish? What type of information do you want to analyse? Who will have specific roles and responsibilities? These are all questions that need to be answered before deployment occurs. And remember to get buy-in from your practice’s decision-makers. Without top-down support, any data governance program is likely to fail.

6. Create a roadmap to success

Now you’ll want to outline every key step along the journey to deployment. Make sure to include all the requirements for a successful launch of your data governance program, including what data streams to integrate, the type of metrics and reporting you’ll use, as well as how and when you will roll out the program.

7. Deploy and revise (as needed)

With everything in place, it’s time to ‘go live’ with your data governance program. Ensure your leader or leadership team have everything they need to deploy and offer support where needed for the duration of transitioning from non-governed data assets to fully governed assets.

After rollout is complete, that’s not the end of the story! You’ll want to measure the program’s effectiveness on a regular basis (using predefined metrics) and allow for minor changes wherever needed. Agility and adaptability are essential for success, so don’t feel like you need to stay locked into the same strategy you started with.

How can insights be share across your practice?

With a solid data governance structure, you can share relevant insights across internal teams quickly
and securely.

Part of successfully managing a practice, department or project is making sure everyone is on the same page. A good accounting practice management solution allows people to collaborate and understand each other. It also supports a data-driven culture by empowering users to easily share insights and collaborate
on tasks.

Sending a report to a co-worker should be as easy as copying and pasting text, and it should automatically update with the latest information. Version control issues therefore become a thing of the past.

To ensure the accuracy of shared metrics, they should be served from a central repository but proliferated to each user. If your data is not centralised and easily accessible, it becomes more challenging to confidently rely on metrics as a basis for your practice’s decision-making.

Leverage the power of data today

Accounting firms of all sizes need access to a centralised data management and analytics solution, and implementing the right level of governance for it is essential.

With the right accounting practice data management and analytics software, you'll get instant access to data and insights to make data-driven decisions across your practice.