The month-end close is a regular reminder of how important it is to streamline financial processes. Experts from across the accounting industry mention that you should spend less than a week doing your month-end closing in order to focus on more strategic business objectives. We discuss this and other relevant tips in our latest ebook, CFO tips and tricks: How to manage month-end close like a pro. We also cover some of the most common mistakes in managing general accounts, expenses, and taxes.
It’s the end of the month, and your accounting and finance teams are busy gathering all the data they need to close the month, verify account balances, and produce monthly financial statements. In general, this task should give leadership teams the necessary background information to make strategic decisions, but it often comes too late to do so.
Here are our five tips for tackling the month-end more efficiently.
Having a clear checklist of tasks and people responsible is an excellent way to start your month-end. Creating a clear picture of the actions to be done will allow the team to feel engaged. This checklist can be updated and improved as the year progresses and is also very valuable for your year-end closing in December.
In our latest ebook, CFO tips and tricks: How to manage month-end close like a pro, we interviewed six CFOs to gather data and create an essential checklist for finance and accounting teams to run their month-end effectively.
Many financial teams complain that they’re always in the process of closing the month. This continuous process means that important strategic tasks, such as budget forecasting or executive plans, never get enough attention.
Research shows that a more efficient process will allow the finance function to provide leadership teams with more timely information and help them be more agile when responding to
market changes. It also mentions that increased automation is the most crucial factor in closing the books faster.
Automation facilitates faster processes and reduces human error. These two factors are essential for closing the month. Without automation, simple tasks can get delayed, especially if a key team member is on vacation or out sick.
Bank reconciliations and attaching invoices to transactions are some of the most arduous tasks that accounting teams have to perform as part of month-end close. But, thanks to expense management software such as Payhawk, these tasks can be completely automated (and sent to accounting software via integrations).
With Payhawk company cards, the mobile app will ask the cardholder to attach the receipt once a transaction is made, which they can do in a couple of clicks. The app also sends weekly and monthly reminders to cardholders so that the accounting team can stop chasing the team to submit their receipts.
Similarly, your Payhawk account has a dedicated IBAN so that you can pay employee reimbursements and bills instantly, in just a few clicks, thanks to SEPA Instant and Faster Payments. The only task your accounting team needs to perform is to download the month-end expense report. The report includes all the necessary information, including invoices.
Generally, when companies think about automation, they think of large investments in their IT systems. However, today, thanks to the development of the SaaS industry, this is no longer the case. Business automation and digitalization are now available to any company of any size and at an affordable price. And thanks to open APIs, integrations between all these systems are smooth and secure, allowing teams to save time and resources.
One of the outcomes of remote working is that more and more companies now use the cloud to store their company data. Having real-time company information is crucial to making decisions fast. Strategic choices can't wait until the end of the month.
Research from Deloitte explains that in order to have more real-time company data, you should start by isolating processes that tend to happen only once a month and try to push them to once a week or once a day. After identifying those tasks, companies should look into what technology can support them.
Having company data in the cloud allows teams to have access when working remotely and is crucial for companies with several entities. Payhawk allows you to have all your entities' expense information in one single platform and stored safely in the cloud.
Moreover, as more and more governments implement cloud systems to avoid fraud and streamline tax payments and accounting, there's no excuse to stay off the cloud.
Finally, it's essential to review the month-end close process every month to improve it. Speeding up the process might lead to errors, but if done in sync with regular reviews, you have the opportunity to improve each time.
Looking for more ways to improve the process? Download the ebook, CFO tips and tricks: How to manage month-end close like a pro, today. Or, if you're ready to automate your company spend, book a demo with us and find out how we can help you manage your business finances with slick technology and first-class customer support.
Whether you have tens, hundreds, or thousands of employees, we’re making your business spend work for you, giving you control over spending at scale with a single solution. Say goodbye to tedious finance tasks, and schedule a demo with us today.