Simplify Year-End with the Right Tools

November 10, 2023

Key Takeaways

  • The most common year-end issues are related to inaccurate data and inefficient processes.
  • Though 26% of accounting systems are able to close in less than one week, over 34% take more than 16 days.
  • Success and efficiency at year-end is largely dependent on the preparation and foundation that you establish all year.

Year-end can be an arduous, time-consuming process. But it doesn't have to be. If your team struggles to close out the year efficiently, you’re not alone. In order to alleviate your stress at year-end, now is the time to examine your processes.

Whether you've discovered inaccuracies in your data, reconciliations that don’t tie back or simply get overwhelmed with tedious, manual processes, having the right tools in place can eliminate your year-end headache and ensure accurate reporting year-round, leading to a simplified year-end close.

Top Year-End Challenges (and how to solve them)

On average, it takes organizations thirty days to complete year-end close. The biggest headaches related to year-end can be attributed to just two factors:

  • Delayed, inaccessible or inaccurate data
  • Manual, time-consuming processes

Delays in producing reports and inaccuracies in your data can be caused by a multitude of factors—inaccessibility, human error from manual entries, or disconnected systems. The great news? By solving these root problems, you can be on your way to a simplified year-end close.

Business Management Software

Using the right business management software is the key to achieving financial efficiency. The financial analysis of your year-end data is leveraged to inform budgeting, forecasting and major financial decisions. However, your year-end financial statements are only valuable when they’re accurate. Difficulty retrieving data across locations and a lack of uniformity in data collection prohibit a speedy and accurate close.

Though 26% of accounting systems are able to close in less than one week, over 34% take more than 16 days.

While that may not seem significant, a delay of three weeks has a ripple effect throughout the rest of your organization—from finalizing budgets to simply understanding your overall financial health and performance.

Recognizing that you may not be on the right system for your organization or that you have outgrown your current solution is the first step to financial efficiency.

Here are some signs that you need to explore an alternative solution:

  • You rely on spreadsheets to track and report your monthly financials— exporting your data, consolidating and manipulating it in Excel before presenting to key stakeholders.
  • You can’t trust your numbers to be accurate
  • Your month-end requires time-consuming manual processes
  • You’re forced to process bulk transactions monthly instead of in real-time
  • You spend significant time every month reconciling transactions and/or data from one system to another
  • You’re running multiple processes across numerous, disconnected tools

Think of your technology solutions as an employee at your organization. Just as you invest in your employees, you invest in having a financial system that can learn your organization and adapt as your organization grows. And, just as you work to fill your organization with the right talent, you need to also prioritize implementing the right technology for your business. From a financial efficiency perspective, this technology is often an ERP (enterprise resource planning) system

The right ERP shows up every day for work. It knows, understands and connects your business. Your business system speaks your business’s language and delivers timely, valuable information to the leadership team so you can take action. It has the agility to grow with you; just like the high-performing employee who started in an entry-level position and worked their way up to management, your ERP scales with your organization’s evolving needs, taking on new responsibilities and working across departments.

System Integrations

A single solution or technology can only do so much on its own. Having the right tools doesn’t mean much if they can’t talk to each other in a language they all understand. After all, what good is an employee that does not collaborate with others?

It becomes especially complicated when you have to rely on a different person with a specialized skillset to manually maintain all of those tools. This is often where cloud native solutions can provide an advantage, as they are built to better integrate across your organization; however, they still need to be expertly stitched together to gain the maximum benefit.

Integrating your tools allows visibility across multiple areas by tying your sales orders and customer records to your financial system, establishing the same universal data language for accuracy and trust in your data.

Process Automation

When your tools are integrated and “speaking the same language,” the next obvious step to improve your operational and financial efficiency is to minimize—or eliminate—as many manual processes as you can.

Automating manual processes not only removes the risk for human error, but it also frees up valuable time for your employees to complete higher-value work that can have a greater impact on your organization. This results not only in higher job satisfaction for your team, but also enables your organization to do more with the resources you currently have available. If you can automate your processes, you can drastically cut down the time that it takes to close out the year.

Some business management software has robust process automation capabilities. Other times, robotic process automation can be used as a stop-gap for organizations who aren’t ready for new systems or integrations.

Watch how RPA can be used to process invoices and read more about how business process automation can elevate the value of your organization.

Data Warehousing & Analytics

Centralizing your data in a data warehouse results in one single source of truth for your entire organization. With a data warehouse, your financials can be compared to external data for better forecasting and decision making. This means that the executive leadership team can have more complete, holistic answers to a much wider range of critical business questions.

A data warehouse enables users to:

  • Create hyper-customizable, ad hoc reports using multiple data sources.
  • Predict future growth, identify bottlenecks and reveal pain points.
  • Leverage statistical algorithms similar to those used in machine learning, AI and data science.
  • Consolidate data from multiple, diverse data sources.
  • Query key performance indicators in real-time alongside operational analytics to evaluate team performance.

This means that at year-end close, you can eliminate the manual compilation of data and get a holistic view of your organization—in real time. Data from your financials, customer database, marketing and sales, inventory, shipping and logistics, and employee information can all come together to tell a story of where your business has been, so you can decide where you want it to go.

The Key to a Successful Year-End Close

Success and efficiency at year-end is largely dependent on the preparation and foundation that you establish all year. If you experience headaches trying to close out your year, it’s likely due to inefficiencies in your data, processes or technology.

It is easy to look at the year-end process through the single lens of taxes and W-2s, but financial efficiency is enabled through leveraging the right solutions and innovations to improve and empower your people, processes, and data.

While there is no one-size-fits-all technology solution that will solve all of your problems, there are solutions available to help tackle your challenges and transform your operations – and a trusted advisor can help.

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Here to help simplify year-end planning and compliance.

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