How to overcome common pain points in month-end financial close

Prophix ImageProphix Jun 6, 2024, 8:00:00 AM

Chances are, if you’ve spent any time preparing a month-end close, you know that it can be a chaotic process that takes up valuable time. Without overhauling your entire approach, it can be challenging to take your financial close beyond the status quo so you can focus on strategic priorities.

In this article, we’ll walk you through how to transform your chaotic close into the streamlined process you’ve always dreamed of.

The chaotic close and pain points

Before we dive into what it takes to streamline and optimize your financial close, it’s important to understand what the symptoms of a chaotic close are, and how it’s negatively impacting your business.

Some of the words finance leaders used to describe their month-end close at Prophix Live! Include: chaos; urgent; 7 days of stress; long; and tedious, all of which point to the fact that finance teams struggle with financial close.

For many organizations, symptoms of a chaotic close include:

  • A lack of visibility
  • Undocumented and scattered processes
  • No single version of data truth
  • Audits that are stressful, disjointed, and expensive
  • Increased team stress making it difficult to onboard new hires
  • Inaccurate and incomplete financial close with no audit trail
  • Delayed financial close that extends beyond month-end

If any of the above symptoms resonate with you – it’s time to consider how you can bring your financial close closer to the optimal standard, and beyond.

The status quo close and its limitations

Organizations that have a more manageable financial close tend to have some sort of checklist or workflow in place, typically in Excel, that improves collaboration. Yet, these kinds of processes aren’t built to scale and can quickly become unruly when more people are involved.

And many CFOs aren’t necessarily invested in the accuracy and auditability of their financial close – it’s merely another routine process that must be completed. But it’s difficult to guarantee the quality of your data when you’re using Excel, as there is no way to know where the data came from and whether it’s been updated to reflect any recent changes.

So, even for companies with a status quo financial close, there are still struggles, including:

  • Difficulty complying with regulatory requirements
  • Challenges creating an audit trail
  • Time-consuming to update Excel spreadsheets and track changes
  • Inability to scale processes to accommodate more departments
  • Hard to guarantee data security and accuracy

All these problems contribute to longer timelines for account reconciliation, a key component of an effective financial close.

So, how can you achieve nirvana when it comes to your month-end close? What processes, technology, and workflows can help you get there?

Let’s look at how finance technology can enhance your account reconciliation process and fast-track your month-end close.

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The dream state: A streamlined and efficient close

Now that you know what chaotic and status quo month-end closes look like, it’s time to discuss how to combine automation, technology, and collaboration to streamline your financial close.

With finance technology, like a financial performance platform, you can do away with Excel ambiguity and back-and-forth communication by automating your workflows with built-in approvals, due dates, and tasks.

This is where PROPHIX ONE ACCOUNT RECONCILIATION comes in - our forthcoming solution compares balances in your accounts with external statements, eliminating discrepancies and significantly improving accuracy. This means no more sleepless nights worrying about hidden errors cropping up at the worst possible moment.

By identifying and correcting errors early on, Prophix One Account Reconciliation acts as your financial safety net. Misposted transactions, duplicated entries, or unrecorded expenses will be caught and corrected swiftly, ensuring your financial statements are always reliable and up to date.

Regular reconciliations can also play a crucial role in fraud prevention. By verifying that every transaction aligns with supporting documentation, you can detect any unusual or unauthorized activities before they escalate into major issues.

Compliance is another benefit of a financial performance platform. Accurate and timely reconciliations ensure your financial records meet all regulatory requirements, simplifying audits, tax filings, and other external reporting obligations.

Want a sneak peek of PROPHIX ONE ACCOUNT RECONCILIATION? See how it works below:

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Finally, by incorporating account reconciliations into your financial close, you can significantly streamline your month-end process. Instead of a frantic scramble, you can expect a smooth, efficient workflow where everything is already in place and verified.

Conclusion: Financial close and account reconciliation with Prophix One

In short, a Financial Performance Platform like Prophix One is not just a tool – it’s a game-changer for achieving your dream of a streamlined, error-free financial close. Embrace the next generation of financial management and let Prophix One guide you to unparalleled efficiency and accuracy.

See Prophix One Account Reconciliation in action in our latest video.

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