While many accountants feel comfortable sticking to the status quo of manual processes, they do present some serious challenges to companies looking to develop and scale their business. Some challenges finance and accounting teams encounter when performing a manual close process include:
- Inaccurate data that leads to audit errors
- A lack of clearly defined processes to complete the month-end close
- Discrepancies between sales numbers and revenue received
- Delayed reconciliations due to adjustments and reclassifications
- Limited visibility due to a lack of real-time data
To resolve these challenges, there are a few financial close solutions you need to incorporate into your workflow. Transitioning your financial close processes away from manual workflows will give you access to one of the most efficient tools you’ll ever use: automation.
If you’re ready to see how automation can transform your financial close processes, check out our free webinar: Leveraging Technology to Meet the Evolving Needs of the CFO.
1. Reduce Your Audit Errors
The data you use to complete your reconciliations often come from multiple sources, such as your general ledger, bank statements, and customer payments. Vendors submit their data and it’s up to you to make sense of the different, disconnected spreadsheets. With limited time to reconcile the data, some teams are forced to close knowing they have accounting errors due to incomplete or inaccurate data.
Unfortunately, an auditor’s job is to find the mistakes within the financial reports. When they step in to review the data, they know to focus on the data coming in from different sources because that’s where the biggest mistakes are always found.
Automation can help you organize and process the different data streams from the very beginning. Having an automated system enables teams to maintain best practices and document any workflows and audit trails before auditors are involved. You spend less time fumbling through spreadsheets and more time processing exceptions, adjustments, and reclassifications.
2. Establish Clearly Defined Month-End Close Processes
When COVID-19 forced financial teams to close remotely, accountants all over the world quickly pivoted to virtual methods. While the process is quite detailed and thorough, the month-end close process itself is still manual, requiring the manager to hold daily meetings to get status updates.
Why not make the whole process more efficient and streamlined? With automation, you can integrate those steps into an automated solution, so you can focus on future-proofing your processes.
Implementing a close task management solution enables teams to visualize a step-by-step process where leaders can assign specific tasks to team members, giving C-suite executives a dashboard that allows them to see everything that’s happening in real-time.
3. Resolve Discrepancies Between Sales and Revenue
Remember when the only types of revenue you had to account for were cash, checks, and credit cards?
With the new age of remote living, there are some customers that will likely never step foot in a fast-food restaurant or grocery store ever again. These customers make all their purchases online and rely on delivery services to bring the restaurant or store to them.
This has caused payments from delivery services to increase exponentially. Plus, when customers are unhappy with their purchase due to their experience with the delivery service, it usually means your company is the one that suffers.
Automation allows you to process through payment discrepancies with various vendors more quickly. It allows you to identify the inaccuracies and investigate the source of the discrepancies.
4. Process Adjustments and Reclassifications Easier
The biggest challenge to reconciling adjustments and reclassifications happens because you’re working with the transaction long after it’s become a problem. This means more work as you’re forced to backtrack to find supporting documentation and adjust or reclassify the transaction.
Financial automation software highlights questionable transactions in real-time, allowing you to investigate and resolve them as soon as the error arises. While adjustments will always be part of the month-end close process, you’ll gain more control over their volume so you can focus your team’s attention on more important tasks, like future forecasting or working more diligently on accounts of opportunity.
5. Establish Better Control with Real-Time Data
While you might get a cathartic feeling checking off a box on a spreadsheet checklist, working with these manual solutions is keeping you behind the times.
Data is only as timely and accurate as the moment it was posted. In order to make real-time decisions you need to help your organization scale, your accounting team needs to embrace automation.
Access real-time data and leverage the functionality of your accounting software with close automation. You’ll be able to merge your data points from your Systems of Record into one centralized software that allows you to have better control over your close process.
The Adra Suite – Automation for Today’s Month-End Close
From reducing audit errors to establishing control with real-time data, we just covered five ways that automation can close the door on accounting inaccuracies. Engineered with automation in mind, the Adra® Suite of financial software solutions streamlines your month-end close so you don’t have to spend unnecessary time and energy on antiquated manual processes.
- Matcher reduces the time you spend on transaction matching.
- Balancer makes the reconciliation process easier through automation.
- Task Manager lets you work more efficiently by seeing your team’s progress.
- Analytics gives you full visibility into your financial close with endless reporting capabilities.
If you’re ready to trade in a manual close process for automation, let’s talk about how Adra® can help you optimize and automate your organization’s accounting.