The month end close process is a recurring challenge for Finance departments, many of whom manage multiple P&Ls, balance sheets and data sources. International structures pose additional demands, making the whole process as complicated as untying the impossibly intricate and difficult Gordian knot.
Combating the huge data challenges and dealing with the increased heavy workload often requires input from all available staff, and habitually, longer working hours. Our research* confirms 94% of businesses close their month end early, simply to allow extra time to process errors in data – is this really the best way of tackling the Gordian Knot?
When the month end cycle rolls around, issues are often not spotted until a firm’s CFO examines the data output, which calls for manual adjustments to be made before the data is re-submitted into the cycle. The cause of the problem is most frequently a data issue in the general ledger or another financial system.
It is therefore no wonder that manual adjustments are reported as the biggest pain point faced at month end by over half of CFOs surveyed*, highlighting just how widespread the problem reaches. This was closely followed by frustrations with processing errors – 45% reported this as their ‘bête noire’.
If organisations could reduce the volume of manual adjustments, whilst at the same time satisfy audit requirements, they would be in a greater position to free up time and resources. As it is, 66.5% of those questioned confirmed they close two days early, and a quarter close a day ahead, in order to combat the challenges of processing such large amounts of data.
What’s the alternative
Automated solutions with labour saving features can ease the closing process; organisations no longer need to burn the midnight oil. Staff morale can be boosted, overtime costs can be reduced, errors can be eliminated and accuracy improved. All of this whilst substantially reducing the volume of manual adjustments, and at the same time satisfy audit requirements. In medium to large Finance departments, savings up to 50% of the time and effort incurred in performing the month end close process.
Ease the closing process – Introducing a set of powerful workflows enables the close process to be automated and easily repeated
Reduce time and effort – Automatically validating data produced from a variety of internal and external systems, handling QA of Ledgers, journal entries and documentation, and reducing manual adjustments saves up to 50% of time and effort in medium to large Finance departments
Improve accuracy – Automated, audited and streamlined sign-off procedure improves accuracy and saves time on approval processes
Insightful analysis – Drill down reporting to identify and correct issues quickly
Ways to learn more:
By implementing a more efficient month end regime, staff can spend less time adjusting errors, and more time focusing on higher value tasks. The more automated processes implemented, the more confident CFOs can be in the data output. Importantly, they may now turn their attentions to the business insights to be gained from the data itself.