How do you get a fast & quality Financial Close?Ben Gittins
Much has been spoken in recent years of ‘fast close’ as if speed is the only consideration and we are not about to change that. However, there are other aspects to a financial close to consider other than speed, namely quality and risk aversion.
It is true a fast financial close has many benefits including time saving and providing the opportunity to better understand the details behind the financials.
In a recent study from BARC & Wolters Kluwer, 67% of participants saw faster closing as a continuous challenge that will continue for at least the next 3 years. Although it has been a priority for several years, it is something that many organisations still struggle to achieve.
To achieve a faster close, many financial software vendors are enabling the automation of key accounting processes and reducing the need for manual input. In this case, we are using the example of Account Reconciliation. A major pain point in the financial close is ensuring key balances on the balance sheet are fully reconciled.
As we discussed in our previous article, investing in a more advanced solution can help remove several challenges.
Account Reconciliation is not always a straightforward process and alleviating the difficulty will benefit the whole close process. The time saved can be spent on more thorough analysis both locally and within the Group Finance review processes.
Thinking beyond a fast close
Not only does an automated solution enable a faster close, but it can help improve the quality of the close and reduce the risk of nasty surprises in the balance sheet. Good data is key for any organisation but not always attainable.
With an automated solution, organisations can report their numbers with confidence. This is because of the vast improvement in the quality of the Result as the balance sheet will be fully reconciled at the point of reporting as opposed to afterwards. Reconciling key accounts retrospectively can result in prior year adjustments which can be dangerous and if material, reputationally damaging.
If you couple this with risk, it also reduces the likelihood of incorrect figures being reported to the board, shareholders, or the City; all of which could have negative repercussions for the business and potentially its share price.
Furthermore, the use of a centralised solution gives Group Finance visibility and assurance that this key process is being addressed by all contributors to the consolidation process.
A fast close is of course important, but what is often overlooked is a good quality close and a lower risk close.
Funnily enough, CCH Tagetik has just such a solution.
CCH Tagetik’s Finance Transformation platform provides a single product to manage the end-to-end financial close. Their single platform includes an automated Account Reconciliation solution. Any senior finance professional or process owner who logs in to CCH Tagetik has the transparency of the close (within the set jurisdiction). The system saves huge time in the process with the system showing reconciled and reviewed data as well as data that still requires reconciliation.
CCH Tagetik allows you to implement quickly, eliminate errors and get complete control with built-in process monitoring, detailed audit trail, and a mandatory approval workflow.
The CCH Tagetik cockpit allows users to view the status of reconciliation with further details provided for all reconciliation statuses within the accounts.
HAYNE is a trusted UK CCH® Tagetik Partner with a proven ability in delivering best-in-class solutions.
The combination of the HAYNE focus and the strength of CCH® Tagetik delivers results for our clients time and time again. We are certified CCH® Tagetik Developers and can support you with the planning, training, and implementation of your CCH Tagetik solution.
We don’t just sell the software, we become your partner.