There looks to be an innovation for each problem in today's world, with this in mind why are finance employees still expected negotiate a trade-off between speed and accuracy of the financial close?
In a recent survey by an accounting reconciliation software company, a large 72% of finance employees expressed that they do not trust the reported financial close figures. This stunning statistic shows that finance employees are still combating the financial close process, however why should this be the case within the digital age?
The financial close benchmark report includes the results of a recent survey of finance professionals from across Europe and America (US) and divulges some worrying statistics.
As well as only 28% of finance employees trusting the reported numbers, the survey additionally found that:
- Only 15% of front-line finance employees are sure of the reported figures, compared to 30% of managerial employees.
- 90% of finance employees are struggling to provide for a quicker monthly close.
- Only 39% of finance employees are happy with the standard of the closing process.
“The trade-off between accuracy and timeliness creates challenges within the accounting process.” mentioned one monetary close survey respondent.
But why ought there be a trade-off within the first place? Let's examine a number of the hurdles hindering finance professionals in their own words.
“There's an over-reliance on excel. Monitoring changes is always difficult.” – For people in finance, segregation of duties and a transparent audit trail is of utmost importance. Whereas we tend to guarantee it happens everywhere else, Excel spreadsheet reconciliations are nearly impossible to trace. And the reasoning behind why specific sums are reconciled could be a challenge to trace too. we all know the demands on Segregation of Duties and Audit trail, therefore why do we tend to settle for such trade offs once it involves Excel reconciliations?
“There are too many manual processes. The less paper and more digitally streamlined, the better.” -The accounting reconciliation software company survey additionally found that there was a mixture of archiving solutions being employed by finance employees. Astonishingly, nearly 12% of finance employees still use binders to organise their archive, whereas over 50% use a mixture of digital archives and binders
Using binders or a mixture of digital archives and binders makes finding the required items of data abundantly tougher and will increase the time required to finish your monthly close process. It also can make it abundantly tougher to fleetly manage eDiscovery or audit requests, all of which can jeopardise the financial integrity of your business.
“We do all our accounting in ERP, and reconciling in Excel. we have a tendency to also complete both entering and reporting with an in-house system – three totally different applications!” -Using different financial reconciliation specialist programs to finish your monthly close method will be helpful; however manually transferring information between account reconciliation programs is long and susceptible to errors. A trade-off in both time and accuracy.
Overcoming the trade-off
With an enhanced financial close software system solution, finance professionals now no longer have to be compelled to balance the trade-off between speed and accuracy. Instead we are able to revel in the most effective of each world by combining the facility of all-in-one financial close solutions, that feature a good quality ERP solution to chop down on long manual tasks whereas guaranteeing accuracy and compliance.
Financial Reconciliation software features:
- Automatic account reconciliation process.
- Clear audit trail by distributing changes to user IDs.
- Follow-up approval alerts to assist and progress the work flow.
- Management of the entire process, as well as your corporate governance and risk management, from one dashboard.
- In-depth reports from inside the reconciliation software programme.
- A totally digital archive.
All of these features and benefits of new Cloud-based reconciliation software will help to automate your monthly close and will bring a wealth of benefits to your finance department and help increase both speed and accuracy to your financial reconciliation.