Globally, CFOs and finance leaders are aware of the challenges that come with closing the finance books for monthly, quarterly and annual reporting. If you speak to them, they will tell you that the process is manual and cumbersome but works well enough. However, throw in an exception or an unexpected event and all hell breaks loose – and, this can happen each month, quarter or at year-end.
What CFOs Think
By design, the close process for any established global organization has, over time, become complex, risky and extremely laborious. This is primarily driven by rapid growth supported by legacy platforms that offer limited flexibility, leading to bolt-on processes and tactical solutions required to keep the parts moving. Even with robust ERP systems in place, teams have to rely on multiple spreadsheet trackers and team calls to close the books in time. Interdependent global teams, departments and functions which run locally need to adhere to one finance calendar under one time zone.
Add COVID-19 into the mix, and we have created the perfect storm. Many organizations have created a virtual task force yet are still challenged and worried about the integrity of the reports and numbers they have published. An accelerated finance close process has now become a critical need and should be considered as part of any global organization’s strategic planning.
Key Ingredients for Success
The new age finance close process must be:
- Accelerated, to free-up capacity and repurpose effort to perform meaningful analysis on the financial data – not just collect, sort, consolidate and report data
- Resilient, so that eventualities such as COVID-19 can be minimized
- Flexible, to accommodate exceptions and unplanned events
- Scalable, to process more data as you grow
Journal entry automation alone can lead to ~40% effort reduction. Automated reconciliations and start-stop activity analysis are other examples of quick wins.
The transformed, accelerated process will increase the confidence finance leaders have in the closing process, increase employee engagement and satisfaction and lead to an overall cost reduction of the process.
Take the Next Step
We package our solutions to provide and accelerate finance close frameworks. These come with integrated best practices and ways of working that have been implemented by finance teams at some of the world’s leading insurance companies. The first step is a short, sharp diagnostic (based on EXL’s Digital EXLerator Framework®) which identifies and quantifies improvement opportunities.
With over two decades of experience working with finance leaders across Australia and globally, EXL is confident that we can support you in delivering a transformed financial close process to take you to the next level. Contact us to learn more today.