Technology defines generations. As we progress as a society, references to old technology quickly reveal one’s age or at least their generation. Rotary telephones, floppy disks, record players, and even VCR’s have all turned into explanations for Millennials.
It’s time for accounting spreadsheets and binders of paper print-outs to join the ranks of antiquated technology and be limited to “do you remember when” statements in conversation.
Why Not Spreadsheets?
Think about this for a moment. What would your days look like without Excel spreadsheets to update or stacks of paper records and receipts to sift through?
The technology required to eliminate both is transforming the way accounting and finance work, and it only seems logical to automate labor intensive, error prone processes like account reconciliations to verify the accuracy and integrity of your balance sheets.
Managing account reconciliations on spreadsheets and in binders is accepted by many as “the way it’s always been done”, but it is an inefficient, costly process filled with risk. Excel-based procedures result in an overall lack of consistency and disjointed systems that lead to audit and management concerns.
Here are three major issues with using spreadsheets for account reconciliations to verify balance sheet data, and their corresponding solution.
- The Issue: Labor Intensive & Time-consuming
Manual, spreadsheet-driven processes can unnecessarily consume three to four hours of an accountant’s time each day. And with accountants stuck in the trenches, manually summing up the numbers and spending their time on the mechanics of reconciliation, there is little time left to analyze balance sheet exceptions.
We are a paperless society, and wading through binders of paperwork each time you need a piece of information after it’s been stored simply isn’t practical.
The Solution: Streamlining and automating the account reconciliations process provides standardized templates and workflows for balance sheet preparation, approval, and review.
This frees accountants from tedious tasks so they can perform more value adding activities. All of the hours spent updating spreadsheets can now be reallocated to enhanced analysis and strategy.
- The Issue: Error-Prone & Lack of Control
Accountants are entrusted with managing strategic business performance, and they need high-quality data to develop accurate forecasts and know when to seize market opportunities.
Manually managing thousands of reconciliations makes it challenging to meet deadlines and leaves companies vulnerable to human error.
Accountants are experiencing mounting pressure to do more as they execute the myriad of tasks needed to close the books, and this can result in data-entry errors that lead to incorrect balance sheet data.
The Solution: Account Reconciliations software removes the risk of paper-based, manual spreadsheets and drives accuracy in the financial close by providing accountants with a streamlined method for verifying the correctness of their balance sheets.
It streamlines the reconciliations process, dramatically enhances internal controls, while enforcing standardization to improve the quality and accuracy of financial data.
- The Issue: No Visibility
In today’s always-on business world, it’s essential to have real-time information at our fingertips. There is mounting pressure to increase transparency in financial reporting, and spreadsheets cannot provide this kind of visibility.
With no central database, there is a lack of control, and the inevitable inconsistency can hamper big picture strategy and decision making. This, in turn, can have a profoundly negative impact on the organization.
The Solution: Automation creates transparency around the entire account reconciliation process, immediately mitigating risk. It also provides much greater visibility into the process, and better structure around the close by standardizing, controlling and optimizing procedures.
Enforcing standardization improves the accuracy and the Balance Sheet Integrity solution, and real-time access to that data can inform the growing number of critical business decisions.
Finance today is producing a proliferation of data along with the challenges of making sense of it all, and holding onto manual processes is no longer sustainable.
Finance automation yields incredible efficiencies, and with it, the transparency and visibility executives need to make better business decisions. It provides accuracy and therefore reduces risk, unleashing accountants to focus on strategy and analysis, which is what drew them to this profession in the first place.
For further information please call +44 (0)203 866 8800 or view the, 'Automating Account Reconciliations: A Quick Business Win' webinar recording: