Welcome to Data Analytics and
Decision Making
Session 1:
Types and uses of analytics
Today's Agenda
• Data analytics and accounting
• Data and Data analytics
• BREAK
• Types of data analytics
• Activity: take a moment to reflect
• Recap, Q&A, Discussion
• Key takeaways
Learning Outcomes
Discuss the different types of data analytics available to
an organisation and how they apply to accounting.
Describe the data analytics process and how it is applied
to accounting projects.
Describe the ethical and governance considerations of
data collection and data use.
Explain and apply data extraction, transformation loading
techniques.
Data analytics and accounting
The impact on accounting
Data literacy …Why now?
Technical drivers
Growth in IoT devices
Data, data and data
Source: Statista.com, 2021
BI platform
sophistication and
competition
Moore’s Law
Source: Gartner, 2021
Why now?
- Big Data in a slide
Big Data
(lots and lots and lots of
structured, semi-
structured and
unstructured data)
Continuous Sustainable
competitive
+ = machine advantage and
superior profitability
learning
AI
algorithms
(Clever – but 100%
understandable - maths)
Data analytics definition
What is data analytics?
https://www.cartertoons.com/product-category/data-analytics-cartoons/
Data analytics definition
Data Analytics is the process of evaluating data
with the purpose of drawing conclusions to
address business questions.
BrandZ Top 10 Most Valuable Global Brands 2020 (Source: http://www.thebrandberries.com)
Data at the core of CFOs priorities
Data
related Gartner Survey
areas Shows CFOs Rank
Metrics, Analytics
and Reporting as the
Top Priorities for
2025
https://www.gartner.com/en/newsroom/press-releases/2024-11-20-gartner-survey-shows-cfos-rank-metrics-analytics-and-reporting-as-top-priorities-in-2025
Career boosting skills for new accountants
How accountants (e.g. Certified Public Accountants) candidates
could be better prepared for work as new firm hires.
99% of accounting
firms cited data
analysis tools and
techniques as a
valuable competency
area for new hires
(AICPA 2023 survey).
https://www.thiswaytocpa.com/collectedmedia/files/career-boosting-skills-new-cpas.pdf
Career boosting skills for new accountants
Impact of data analytics in accounting … audit
Let’s look at auditing:
No longer … only But…
Checking for errors, material Analysing data as business analysts,
misstatements, fraud, or just reporting helping management to make better
findings decisions.
Spend more time on manually More automated process leaving time
gathering data to focus on logic and rationale of
auditing
Changing role of auditors:
Engagement with clients beyond the audit …
helping companies to refine process, improve
efficiency or anticipate future problems
Impact of data analytics in accounting … tax
Let’s look at taxation:
No longer … only But also…
Dealing with compliance issues Developing planning capabilities to
minimised taxes
Reacting to the company’s past Predicting the potential tax
performance consequences of international
transactions, R&D investment or M&A
Shift in focus:
Develop planning capabilities to allow tax
staff predict what will happen
Impact of data analytics in accounting …
Deliver better audit
Prioritise areas with Analysing 100% of the
coverage and
elevated risks transactions
assurance
Improve operations,
Automate routine
Quickly identify compliance and
function to boost
fraudulent transactions internal audit
productivity
reputation
Becoming a trusted advisor to the
organisation/client
Data and Data analytics
Basic Concepts
Let’s have a common understanding of data
Data is anything that can be observed and therefore
recorded and stored in a database or other system
Any recorded change to that data is therefore
‘new data’
Linking data together creates ‘metadata’: Data about
data
Data overview: classification by type
Data
Quantitative Qualitative
(a specific number) (Category data)
Continuous Discrete Ordinal Nominal
(ranked data) (categorical data)
• Growth • Money (turnover, • Customer • Stock market name
• Profitability costs, profit) ranking e.g. poor • Shareholder Voting record
to excellent
Data overview: classification by type
Quantitative Quantitative
discrete continuous
Qualitative
nominal
Qualitative
ordinal
Data overview: classification by structure
• Typical conforms to a data model / schema and is used to capture
relationships and attributes.
• Structured method of storage – typically held in a relational data
Structured base. E.g. PostgreSQL, MySQL
• Standardised tools and database types are widely used
• General ledgers, check registers, sales records, etc
• Often does not conform to a standard data type or model, with
inputs varying widely. These data types might include images, text
files, OCR very large complex data sets such as genome mapping
Unstructured • Special Purpose Logic or Pattern Recognition Algorithms required to
process / query the data
• Emails, invoices, social media,
Types of data analytics
What can we do with data analytics
Types of data analytics
Response? How to
(autonomously) execute? Prescriptive
What will
happen? Predictive
Why did it
Value
happen? Diagnostic
What
happened? Descriptive
Decision making &
Hindsight Insight foresight autonomous control
Complexity
Source: Adapted from Big Data Fundamentals. Erl et al (2016)
Types of data analytics
Accountants Clients
Descriptive Traditional reporting such as monthly Reporting to clients on annual accounts or tax
analytics: report packs, returns
What did standard list reporting such as
happen? workflow to-do lists, and staff utilisation
reporting
Diagnostic Monitoring changes in data; Alerting based on variance indicators
analytics: variance/trend analyses (such as
Why did happen? budgets from previous years)
Predictive Determining trends and predicting Provides alerts about the potential impact of
analytics: future outcomes future changes.
What will
happen?
Prescriptive Use predictions to recommend actions; More robust partnership between accountants
analytics: more thoughtful decision-making. and their clients
What should do?
Activity:
Take a moment to reflect
Activity: Take a moment to reflect
How can data analytics skills be a key selling point in:
my CV?
my next job/position interview?
my next client meeting?
my next project?
This Photo by Unknown Author is licensed under CC BY
How important is to be a data literate person in my
future professional career…
Recap, Q&A,
Discussion
Key Takeaways
You should be now be able to:
• Understand what data analytics is
and its relation to accounting
• Understand what data is
• Understand the four types of data
analytics
Break Time
