Any organization should be able to produce accurate and timely financial statements in a reasonable amount of time after the month’s end. Financial statements are crucial to management, so they can understand the financial health of the organization and make short-term and long-term operation and strategic decisions in a timely manner.
An important tool in increasing the efficiency of this procedure is a month-end close checklist. In addition to helping you stay organized, it will also help you identify problems and understand where obstacles occur, as well as which tasks impede a speedy and efficient month-end close.
Here are our top 5 tips:
1. Manage your time well
This goes hand-in-hand with resisting pressure. If you are well organised, you will have a plan set out for each day’s goals. Meet with team members on a regular basis so that they are also aware of your expectations and deliverables. Use a task manager tool to set your schedule and gain control and visibility over everyone’s task status and workflow. This effective management of work flow helps to reduce risk and ensures you meet your month-end deadline.
2. Use technology to your advantage
Software built for a financial close can save you a significant amount of time. In addition, this industry-specific software goes a long way to eradicating human error, say. There are constantly new and innovative ways to do getting things done, so be proactive in following trends and software in your industry.
3. Be aware of your internal controls and risk management
An important part of corporate governance is defining internal controls to protect an organization and to ensure the orderly, efficient and accurate conduct of business. To this end, it is vital that you document your steps to create a clear audit trail. Risks should be identified, analysed and rated, based on the organisation’s risk assessment protocol.
4. Learn from your mistakes
Accounting takes time—every month, you will learn “hacks” that will help you become more efficient in the next month’s close. It takes time to know the ins and outs of a certain software, so give yourself time to become a master; your comprehension will improve the more and more you use it. Don’t be afraid to ask questions and take advantage of any training programs that may be offered by your company or external accounting organizations in your area.
5. Conduct pre and post-close meetings
In the pre-close meeting, discuss the close schedule and timeline, possible issues in the upcoming close, and follow-ups from the previous month’s close.
In the post-close meeting, review what worked well and discuss possible solutions for what did not. Review data that was gathered throughout the process, including time-consuming steps, risks, controls and irregularities from previous months.