Financial Close Best Practices Webinar
Financial executives need to close their books quickly and accurately. And, they need to meet external reporting and compliance requirements and reduce errors - all while cutting costs.
This video highlights five financial close best practices webinar. It starts with how to form a foundation for your organization's general ledger by helping employees to work more efficiently and by automating many period-end tasks, including accruals and reconciliations. Next, it takes a deeper look at the closing-cycle process - from start to finish - including the handling of numerous tasks across multiple organizational units. Simplifying intercompany reconciliation and eliminating time-consuming transactions is the next area of focus. It then offers a final and closer look at how to reduce the time,
This video is from the Proformative webinar "Five Best Practices for a Successful Financial Close" held on August 29, 2012. The webinar features presentations from Pete Graham, Director,
Financial Close Best Practices Webinar
Pete: "We have a lot of slides to go through. We've broken it up into basically three sections with a wrap up for this Financial Close Best Practices Webinar. We'll go through the challenges first, for the high quality financial close. Then, we'll go through with an action plan, which I think you'll find quite helpful in strategizing with your operations at your company on how to improve the close. Then, we'll go through some specifics around types of financial and accounting close solutions that can help in particular areas of the close process.
We've talked to many customers and many of the finance departments that said pretty much everybody wants to close their books more timely. They want to cut a couple days off. Sometimes, it's weeks, depending on where they are.
Unfortunately, there's a lot of challenges that a company faces. It's not getting easier to report financials for companies. Regulations keep getting higher. There's more challenges on the compliance side. There's more and more requests for transparency, but that's more difficult when you're trying to manage the strategy of a business.
There's always this blend between how much do I disclose, and we don't want to disclose too much because maybe competitors learn too much that they can
use against us. We also want to be fair to our investors. There's always this balance.
Then, there's the efficiency. The
That's why we're trying to show that there are a lot of players in organizations involved that really present challenges in meeting all of these via finance department, and achieving a high quality in fast financial quotes.
When we've talked to customers, they've definitely said they want the following things. They want faster cycle times to close the books. Everybody wants to close the books faster, whether it's on the general ledger side or the
Definitely, they want to make sure that they can do it at a lower cost. They also want to make sure the quality of the data has improved. They have the right
They also want to provide the right data to their management so that they can make the right decisions. Obviously, you do not want restatements because that would lessen its stakeholder and investor confidence. All of these things are competing between the stakeholders on one side and the regulatory agents on the other. Of course, we've got executive managers on the finance side as well as the company. They're working with your corporate accounting and local accounting.
All these groups are really trying to service the needs of the execs, as well as make sure that the stakeholders and shareholders get the right information, and the regulatory agents are satisfied.
The good news is that there is success in this area. We had companies that if you take the right approach, you can actually make quite a bit of improvement. Really, we're going to go through this [Beergeet], and Elizabeth will walk through how you size up your organization for the financial close, how you can break it up into different pieces, processes, or steps.
By doing that, you can then potentially take a piece of the process or different areas, focus on that, and improve it, and make a big step forward, in terms of cutting off time to close your books. You can see that some customers that we have worked with have actually had quite impressive reductions by following some of these strategies. We'll go through that in a little bit more detail.
Editor's Note: Proformative offers Corporate Finance, Accounting, and
Essentially, the way of tackling this is not to do it all at once. Really, to go through an action plan and look at the different pieces, and find where your pain points are. Then, really go in, laser focus in that area, and then figure out what makes the most sense. Implement a plan, fix or improve that area, then go on to the next. That's where we've had customers make the most benefit. It's the most efficient way to do it. It's the best way to do it from a total cost ownership perspective.
John: Okay. Why don't I hop in and introduce the first polling question. Thank you there, Pete. This is the first of three polling questions. I'll go ahead and launch it right now. As I mentioned before, if you're here for
We will show everyone all of these results at the end of today's webinar, actually when we get into the Q and A section. We'll talk about the results. It's always interesting to see how everyone is doing, relative to your company. I'll give about 10 more seconds for this polling question. Then, we'll hand it over to Elizabeth Mill.
Okay. At this point, I'm going to go ahead and close down this polling question. I'll turn it over to Elizabeth for the next section. Thank you so much, Elizabeth. Please, take it away.
Elizabeth: Great. Thanks so much, John. What we're going to do now, we're going to talk through financial close action plans. Then, talk about different accounting and financial close solutions after that, then the wrap up.
With the action plan, what we've done is listen to our customers, listen to our peers, and put together an action plan on where do I start. Wanting to accelerate the close has many benefits, as Pete has already explained to us. The question is: If I'm an organization, where do I start? What do I do in order to make this actionable to improve my close process?
What we've got is four stages that I'm going to walk you through real quickly here. Start off with your vision. The first thing that you need to do is to perform an as-is
Being able to go through, you need to do a diagnostic. Talk about the different things. See what works well and what doesn't work well. Talk about the whole end process, the close to disclosure.
We'll talk through more of these steps a little bit more as well too. Different chunks, as you're looking at it throughout your whole close process, as well as benchmarks. There's a number of different surveys that are out there that will give you information on how other people are doing in this area, and being able to understand it for yourself so that you can say, "Okay. Here's where I am today. Here's the different benchmarks that I want to be able to work against."
Different time tables as well, and being able to identify where the best areas are for improvement. Now, obtaining executive sponsorship. We recently partnered with Ventana Research. There is a Proformative webinar on this in the archives out there as well too, talking about the different trends in the fast lane close.
This might seem obvious, but companies that focus on shortening the close actually shorten the close, as opposed to those who don't put a process on it. Getting that executive sponsorship, putting the focus on it, things that get measured tend to improve. These are the types of things that you need to put together, a program in place in order to focus on this as an organization.
Step number two. We've got quick win. Think on what's the low hanging fruit. What are things that I'm unable to do quickly? We have a couple examples here, talking through the close scorecard, creating a closed scorecard. Again, from a measuring standpoint, peer-to-peer in a company reconciliation tends to be a very slow one, as well as leveraging integration tools, controls, and getting the close the first time right. Not having to do restatements, as Pete had mentioned before that. Also, bringing in-house reporting into XBRL.
Along the quick wins, inner companies. Let me speak to that real quickly. If it's from a process standpoint, that's if you're a technology company. In order to improve the close, it's all about people, process, and technology. You need to think about it from a process standpoint, that inner company is a great area where companies can improve. Traditionally, the inner company process works that all of the different reporting..."
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