A solid foundation, well-organized workflows, and quick access to key information all contribute to a successful year-end closure.
For others, the end of the year can be a wonderful season in which the previous year and all activities end, and a brand-new chapter begins. However, what about controllers, CFOs (Chief Financial Officer), accountants, and finance departments? We have just begun. Deadlines will be upon us in no time, and government agencies, investors, and stakeholders will be asking for financial reports and results. It will be a race against the clock to ensure that all adjustments, accruals, and allocations are documented, because only then can the full review process begin to look for substantial faults, errors, and omissions.
The best method to ensure that no stone is left unturned is to use established processes, workflows, and checklists. Every year, however, many businesses struggle to define period-close operations and are unable to determine exactly what must be simplified.
The Struggle Is Twofold: Accuracy & Timeliness
While accuracy does not have to equal perfection, acquiring it is nonetheless difficult. Methodical business processes and workflows that have been designed to assure the gathering of all material information are frequently left with few or no enhancements over time, even as the organization develops and evolves.
Some businesses, on the other hand, do improve workflows by, for example, reordering the order of responsibilities and steps in a process. However, they fail to document such adjustments, leaving teams to struggle to maintain progress over time. Gaps in these systems are then left to be discovered and fixed manually, increasing errors, the breadth of the review, and the time required to complete the year-end close.
Timeliness is also a struggle. The year-end closure is a frenzy of deadlines, ensuring that all transactions are documented, organized, and confirmed. Combining month-end, quarter-end, and year-end reviews means that management and auditors will be bombarded with reports and information in preparation for the release of audited financial accounts. Every trace, vouching, and analytical evaluation increases the workload on accounting employees, who must take the time to gather and deliver their results.
Because all parties involved are working on tight deadlines, the turnaround time for these reports must be as soon as possible, leaving businesses seeking to strike a compromise between a speedy response and quality accounting reports.
Taking Back Control with NetSuite
Much of the anxiety, uncertainty, and fear associated with the year-end close can be alleviated by assuring trust in the fundamental mechanisms of information acquisition and evaluation. The more controls a company incorporates into its daily procedures, the less exposed the organization is to risk, and with fewer errors, the business can close faster.
Finance teams can correctly establish, document, and alter year-end close tasks when they have visibility into the strengths, weaknesses, and quality of source material. Automating manual, repetitive operations, such as account reconciliation and analytical reviews, reduces the chance of human error while also saving a significant amount of time spent on completing these tasks and finding and correcting problems.
NetSuite creates efficient closing procedures from the ground up, ensuring year-end financial reporting is accurate and timely. Built-in automated processes eliminate manual data entry, reduce human error, and speed up the close, while period-close checklists and customized task lists keep operations on track.
With these tools, information may be easily captured, securely accessed, and promptly recovered when needed. You, too, can discover the alleged “beauty of year-end close” that everyone else seems to enjoy with NetSuite and, possibly, better organization and confidence in the year-end closure process.
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