Are you sweating over your desk drowning in journal entries trying to reconcile the books so you can do your financial close for the period? Do you have trouble sleeping just thinking about your monthly not to mention, yearly close? The good news is that there is a better, less painful method of managing your financial period close.
Most CFO’s dream of a faster close, so they have access to the latest data for more informed and faster decision making. The time it takes to close can make a significant difference in your company’s performance and ability to access timely data. Between the top 25% of performing companies and the bottom 25 percent of performing companies, there is a major difference in the amount of time they require to complete the monthly period close. The top 25% close in 4.8 or less, while the bottom 25% require 10 or more calendar days to complete their monthly period close.
With the advent of machine learning, AI, and more aggressive automation of daily tasks, continuous accounting has become a previously unthinkable reality, and it is improving the performance of enterprises around the globe.
What exactly is continuous accounting? The concept of continuous accounting is rooted in not waiting until the end of the period to complete all the tasks that need to happen to close the books. The term continuous close would most closely equate to the accounting concept of a “soft” close. Like a soft close, continuous accounting benefits a company by providing better visibility into financial results throughout the period. The visibility a company receives is both live and in real-time.
Continuous accounting provides a faster period close process. The faster close delivers two significant benefits. With a faster close, executives have timelier access to the most up-to-date data available. This helps them make smarter, quicker, and better-informed decisions for the company. The second important benefit is that the CFO and finance team do not need to spend most of their time closing the books and can focus their time where it really counts-namely, providing analysis and insights that the business needs to make key decisions.
Their analysis can be instrumental in providing valuable input regarding how to scale the business in real-time to accommodate for changes in cash flow or changes in market conditions. It can also help to make wise choices in terms of allocating or reallocating resources in order to jump on emerging opportunities.
And the best benefits of a continuous close? Sleeping better at night, and much less stress on your team!
