Stuck in the chaotic wheel of year-end closing? Make day-zero financial close a reality with HighRadius’ Autonomous Accounting.
The year-end close is a huge hassle for most organizations’ accounting and finance departments. Given the recent economic downturn, many CFOs’ offices are experiencing a greater financial strain, disintegrated processes, and short-staffed accounting teams.
According to a recent Gartner Finance Survey, 86% of respondents said they wanted a faster, real-time close, 68% said they want a cheaper close, and 64% said they want an error-free close by 2025.
One of the biggest roadblocks during the year-end close is the inaccurate company-wide data and processes leading to audit errors. Accounting teams receive inconsistent information, especially when businesses spanning across multiple geographic locations and currencies take an ad hoc approach to closing. Businesses rely on disparate systems, spreadsheets and other tools to perform accounting operations and end up wasting time on ineffective communication with other stakeholders and hunting down information on outdated spreadsheets.
Moreover, companies with fragmented procedures and ineffective monthly and quarterly close processes are more likely to discover anomalies and problems during year-end close cycles.
If your accounting teams spend long hours on significant manual tasks, delay period close, and spend more time talking about the past than the future, these are your warning signs. You need to pay attention to these red flags because it’s time you improved your year-end closing process.
So, what are the things that you should do or are doing to make the process less time-consuming, more accurate, and more impactful for the company as a whole? And how can you make a continuous effort to ensure that every year the process is smoother and easier than it was the year before?
The successful completion of any complex task begins with putting together a plan, and that plan is going to be based on a calendar of what needs to be done – and when.
Now is really the time to look at the tools that you’re using to complete the year-end close processes. All of the reconciliations that you have to make, from the bank accounts to inventory to accounts receivable and accounts payable, even down to the prepaids and accruals. If you’re still using spreadsheets and manual processes to verify balances, check entries and match transactions, you might want to look at new software that will do many of these tasks automatically.
Even sophisticated ERP packages miss some of the newer capabilities that provide for the automatic matching of transactions. There are many software packages in the market that can provide capabilities that make your process smooth and more accurate. But what should you be looking out for?
Accounting teams require a detailed close project plan for reducing close cycle time that includes a task-specific worksheet for faster and more accurate close. An AI-Powered anomalies detection system helps in addressing issues proactively rather than waiting until month end for adjustments. As a result, your finance department can perform continuous accounting. And with a connected workspace for faster completion of close tasks, your stakeholders can get real-time visibility into the status of tasks, dependencies, and delays.
We hear about robotics being used in manufacturing to get faster, repeatable, and more accurate results with fewer errors. The same is true of the new generation of accounting software add-ons. Think about reconciling the hundreds of transactions that occur in your AP or AR operations on a monthly basis, and think about the time that it takes to accomplish it with your existing staff. How would it change your accounting operation and workforce if those operations were done in seconds instead of hours? Many current software packages that bolt into existing ERP programs use AI to accomplish two primary things:
This can now be completely done by automated software, using a process that was only dreamed of just a few years ago. Let the staff work with the more interesting and challenging activities of solving the problems that arise during a close, as opposed to the normal routine and repetitive activities. The end result will also be more interested staff and a more engaged workforce.
As companies continue to struggle to find, train and retain skilled workers, human resources continues to evaluate what they need to do to keep enough skilled staff to get the work done.
What are the reasons why employees look for greener pastures? There are many, and compensation only goes so far. It is the intrinsic feeling of reward that employees feel that makes them happy to come to work the next day. The employee/company relationship is much more complex now, and it would take a book to discuss all the reasons why employees leave companies. But one thing is certain. An employee that feels that they are making their own unique contribution to the company’s results will have a greater feeling of impact on the whole.
How much of an impact do they feel in manually matching transactions? We know that their sense of accomplishment is much greater when they are making decisions and acting on information that they receive, rather than just sorting cards and matching transactions. The key to employee retention is employee engagement. Providing employees with an opportunity to work in an integrated fashion with AI-enabled software, elevates your accounting operations and ties your employees to your company through their sense of accomplishment.
HighRadius Autonomous Accounting Application consists of End-to-end Financial Close Automation, AI-powered Anomaly Detection and Account Reconciliation, and Connected Workspaces. Delivered as SaaS, our solutions seamlessly integrate bi-directionally with multiple systems including ERPs, HR, CRM, Payroll, and banks. Autonomous Accounting proactively identifies errors as they happen, provides the project management specifically designed for month end close to manage, monitor, and document the successful completion of tasks, including posting adjusting journal entries, and provides a document repository to support each month’s close process and support the financial audit.