Conducting the final close through manual methods, such as spreadsheets, is the equivalent of trying to complete a relay race where the runners must collect a different baton at each checkpoint, and then pass on the growing collection to the next person in line. Because each person has their own unique gait and cadence, and because each additional baton increases the probability that one will be dropped along the race’s route, it’s hard to reliably predict when and how well the team will finish the race.
When it comes to your financial close process, it’s important to realize that to stay competitive in today’s global marketplace, financial professionals should not be languishing in a disjointed sprint, but instead have the time and tools they need to focus their efforts on creating a consistent pace – one that will prepare them for each mile of the period end and will allow them to successfully complete the entire course.
As many of today’s elite athletes know, technology can assist you in identifying areas of improvement, and strengthen your overall process with the key controls you need to prepare, train, and execute a winning strategy; your financial close process is no different. To help, we’ve identified five steps for including technology in your financial close that will help you secure a top finish.
1. Evaluate Your Current “Level of Fitness”
Every journey starts with a single step, and evolving from spreadsheets to an automated financial process is definitely a journey. To determine the best opportunity for technology improvement, begin by evaluating each step of the financial process from start to close; which have frequently missed steps and which have the most flawed documentation flow? Once you have evaluated and understand which processes need the most attention, then it’s time to move to the next mile of your financial transformation.
2. Identify a Training Plan
The financial close is an interconnected process with many moving parts, and just like in a long race, you need to warm up before hitting the steep hills. The financial equivalent of a good warm-up is transaction matching.
When conducted manually, matching eats up an accountant’s valuable time in both initial processing and error-correction. Of course, other stages can be good starting points based on your individual goals and strengths. Along the way, challenging your accountants with new tasks will be very beneficial, especially because your company must evolve or it will struggle to stay competitive. Steady progress is essential to cleanly implementing technology improvements, as is evident in the next step.
3. Find a Cadence and Track Your Progress
As you plan which stages of the close process to automate first, you will also need to standardize your workflow and automate its steps. A manual financial process can easily become disconnected and disjointed, like the relay mentioned earlier, because individuals have a lot of flexibility to do things “their way.” You can easily move to a standard method by establishing templates to display all data in the same format and keep everyone at the same pace. Also, an automated workflow will help you evolve disparate manual methods into a cohesive and standardized process; this step is especially beneficial when auditors come to call and need to retrace your steps and documentation. Standardization with templates, as well as a clearly defined process, will allow auditors to easily compare data across functions and time periods for complete visibility.
In this same vein, a lack of visibility into financial processes can quickly create delays and risk for organizations. To make audits as painless as possible, visibility ensures that documents are easier to find and misstatements easier to trace. Once manual processes are automated, accountants can even out their workload and focus on higher-level tasks. In fact, standardizing the financial close process has shown positive gains for Trintech customers beyond their audits, such as 35% efficiency savings and a 50% faster close.
4. Follow Regulations to Increase in Speed
With additional workflow visibility comes an opportunity to implement strong controls, a step not easily taken manually. While conducting ad hoc manual processes, controls may be properly designated but still not reliably managed and executed in spreadsheets, emails and Word documents. These are not the methods of a secure or standardized financial process, or of a growing company. As a forward-looking, proactive company, controls should be integrated with your automated workflow, standardized and monitored continuously. You may be starting with internal controls now, but if they are maintained properly your company could be more easily scaled for the compliance required of larger, public companies.
5. Make All Your Best Practices Automatic
Running a solid race becomes habit with practice, and so should integrating technology into your previously manual processes. Once each stage of the financial close process has been evaluated for change opportunity, you can create a plan to gradually implement automation. Standardization and visibility will lessen your risk and lighten your auditors’ load while also enabling the regulation of integrated controls.
Improving your financial processes and controls through automation technology is a step in the right direction toward efficiency and growth. Your accountants can bring greater value to your organization as their training enables them, while your inefficient manual processes are a sprint of the past.
To learn more, about automating your financial processes, read this eBook.
Written By: Chelsea Downey
 Enabling Financial Transformation Through Technology (2017) https://www.trintech.com/resources/record-report-insights/enabling-financial-transformation-through-technology/