In today's fast-paced financial landscape, having the right tools for data ingestion and financial data extraction is critical for accountants, auditors, and finance professionals. With various options available, from dedicated financial data extraction tools to native accounting system reports, it can be challenging to determine which solution best fits your needs. In this article, we'll evaluate some of the top tools available—Validis, AuditSight, Finagraph Strongbox, native reporting in accounting systems and ERPs, and the traditional excels/PDFs submitted by clients. Spoiler alert: Strongbox emerges as the clear winner.
Understanding Financial Data Ingestion
Before diving into the tools, it's essential to understand what financial data extraction entails. Financial data ingestion involves gathering financial information from a client’s general ledger (via their accounting system or ERPs) and formatting it in a way where you can perform analysis. This process is crucial for audits, financial due diligence (FDD), and other financial reporting tasks.
Evaluating the Top Financial Data Extraction Tools
Let's explore the most prominent tools in the market and see how they stack up against each other.
Overview: Validis is a well-known tool in the financial data extraction space, primarily used by auditors and financial services institutions. It connects directly to accounting systems and pulls data into a standardized format, simplifying the review process.
Pros:
Direct integration with major accounting systems.
Automated data extraction reduces manual entry errors.
Provides standardized data formats for easy analysis.
Cons:
Limited customization options.
May not support all accounting systems, leading to gaps in data coverage.
Higher cost compared to other tools.
Lack of US customer support can leave your team stranded if an issue arises.
Verdict: Validis is a solid choice for those who prioritize automation and standardization, but it falls short in terms of support, flexibility, and coverage. Clients have reported issues of overpromising and underdelivering.
Overview: AuditSight is a newer player in the financial data extraction space, focusing on audit-specific needs. It emphasizes transparency and verification, making it ideal for audit firms that require detailed documentation and data traceability.
Pros:
Strong focus on audit-specific functionalities beyond the extraction phase.
Provides detailed data traceability and verification.
User-friendly interface with straightforward integration.
Cons:
Use-cases outside of Audit are very limited in scope and functionality.
Smaller user base, leading to less community support and unproven technology.
Complicated dashboard with a higher learning curve for first-time users and prolonged adoption cycles.
As a new piece of technology, there are bound to be kinks they need to work out.
Verdict: AuditSight is an excellent tool for audit-focused professionals, but its limited scope and steep learning curve might be a drawback for broader financial data needs. Also, as a newer technology, there’s greater risk that its functionality is unproven and exposed to flaws.
3. Finagraph Strongbox
Overview: Strongbox stands out as a comprehensive financial data extraction tool designed for versatility across multiple financial functions. It offers seamless integration with popular accounting systems like NetSuite and Sage, along with advanced features for handling excels/PDFs and multi-entity reporting.
Pros:
Wide compatibility with major accounting systems and ERPs, including universal Excel upload for uncovered systems.
Advanced multi-entity reporting capabilities.
Custom financial statement mapping functionality.
Integrates with Excel so no need to learn complicated ecosystems or dashboards.
Industry-leading cash flow analysis and cleaned data in flat tables.
Custom outputs for specific use cases, including audit, financial due diligence, ERP data migrations, business valuation, forensic accounting, and client assessments.
Cons:
May have more data and analysis than necessary for smaller firms.
Some customizations require additional time before they can be implemented.
Verdict: Strongbox is the clear winner, offering the most versatile and comprehensive solution for financial data extraction. Whether dealing with complex multi-entity reporting or handling client-submitted excels/PDFs, Strongbox excels in every scenario.
4. Native Reporting in Accounting Systems and ERPs
Overview: Most accounting systems and ERPs come with built-in reporting features that can be used for financial data extraction. While these native tools are convenient, they often lack the depth and customization needed for more complex tasks.
Pros:
Direct access to data within the accounting system or ERP.
No additional software or tools needed.
Ideal for straightforward financial reporting.
Cons:
Limited customization and advanced reporting details.
Often lacks integration with other financial tools.
Inadequate for complex multi-entity reporting.
Verdict: Native reporting tools are suitable for basic needs, but they fall short in delivering the advanced features and flexibility required for more complex financial diligence or analysis needed in an audit.
5. Excels/PDFs Submitted by Clients
Overview: Many financial professionals still rely on excels and PDFs submitted by clients for financial data extraction. While this method is familiar, it is often time-consuming and prone to errors.
Pros:
Familiar and widely used by clients.
No need for specialized software or tools.
Flexibility in data presentation.
Cons:
Highly manual and error-prone.
Time-consuming, especially for large datasets.
Lacks standardization, making analysis more difficult.
Limited reporting capabilities if relying solely on reporting from ERP/accounting system.
Verdict: Relying on excels and PDFs is the least efficient method for financial data extraction. While it may be necessary in some cases, it is far from ideal, especially when more advanced tools like Strongbox are available.
Conclusion: Strongbox Takes the Crown
When it comes to financial data extraction tools, Strongbox is the clear leader. Its comprehensive feature set, wide compatibility, and advanced reporting capabilities make it the go-to solution for financial professionals. Whether you're handling complex multi-entity reporting or streamlining data extraction from excels and PDFs, Strongbox provides the tools you need to succeed. In contrast, other tools like Validis and AuditSight offer valuable features but can't match Strongbox's versatility and ease of use.
If you're serious about optimizing your financial data extraction process, it's time to give Strongbox a try.