The month-end close process may be time-consuming, with finance teams investing a lot of time and effort to what should be a simple process. In Accountagility’s survey regarding the closing process, “53% of CFOs claim manual adjustments are their biggest bugbear”. A smooth month-end close enhances discipline, improves controls, and lowers risk.
What is Month End Close Process?
The month end close process is a step-by-step procedure carried out by businesses to close their books at the end of every month. Some businesses are required to report in a timely fashion, but for all companies, it keeps accurate records throughout the year.
The Close process can involve large volumes of data and often incurs an increase in workload for the office of finance. It’s not unusual to see the finance team working longer hours during the month end close process.
When the month-end cycle arrives, errors are frequently not discovered until checks take place, necessitating manual corrections before the data is re-submitted into the cycle.
Month End Close Challenges
The month end close process can be complicated, time consuming and tiresome for the finance team. Effectively managing the data is the biggest challenge with the month end close. The following are challenges reported by CFOs from a survey conducted by Accountagility:
Huge volumes of data that are difficult to manage
Time and effort required to generate reports
It’s a tricky task to complete the close process early. What businesses need is a reliable solution to help with the closing process. Many top performing businesses have started using financial close software to support their finance team with reducing the risk levels and ensure accuracy.
Ease your Closing Cycles with Automated Solution for Closing Process
The month end close process may benefit from automation in a variety of ways. Most firms rely on spreadsheets to execute these types of operations. After all, spreadsheets offer a wealth of features and flexibility for performing such analysis quickly. Unfortunately, there is a weak link in the activity chain to do this.
To be specific, most businesses undertake analysis by manually inputting data from different sources into a spreadsheet. This adds to your workload, especially if you need to enter or import data. Deploying technologies that enable live connectivity between your spreadsheet and source data within your ERP or other apps is a preferable option.
If your company is expanding and evolving into a more complex environment:
With multiple ledger systems
Complex reporting logic
Subsidiaries in a number of nations
Many "accounting charts" throughout the company
Monitoring and managing foreign exchange rates
...it might be time to look for an automated Financial Close solution.
Financial automation enables firms to achieve their financial objectives, whilst relieving the pressure on finance staff. Speak to an expert to know more about automating the financial processes in your organisation.
Improve Financial Close Process
Automated solutions with labor-saving features can make the closing process smooth, quick, and reliable; businesses will no longer have to work late. Savings of up to 50% of the time and effort spent on the month end close procedure have been noticed in medium to big finance departments with the implementation of an automated financial close solution.
Staff can spend less time fixing errors and more time focusing on higher-value duties when you create a more efficient month-end routine, thus improving the financial close process.
CFOs can be more confident in the data output when automated financial close processes are introduced. Importantly, they can now focus on the business insights that can be gleaned from the data.
To decide whether an automated solution is right for your business, you should start by considering where your data is stored, how good your present processes are, and how complex your organisation is. All of these will help determine which type of Financial Close solution is suitable for you.
Accountagility’s whitepaper covers 9 key capabilities to consider while choosing an automated financial solution. Understanding your options and asking the appropriate essential questions in an RFP can help you choose the best solution for your company.
Tom is focussed on offering a great customer experience, helping companies achieve financial business process efficiencies by up to 80%. He specialises in helping senior executives get better planning and forecasting performance; maximise cashflow; predict accurate business scenarios; close faster and consolidate finances easier.