Accounting departments face challenges with repetitive tasks and non-value-added activities at the end of each month. If your department struggles with manual account reconciliations and time-consuming closing activities, you’re not alone.
Closing the books can be a tough job, especially if your team isn’t super experienced with month-end close best practices. Inefficiencies in time and/or process may also affect the output or delay the activities that go along with it. It can even deplete energy and disrupt the workflow of your team. Some challenges that finance professionals encounter when closing books include:
- Increasingly complex accounting standards
- Dependency on information channels outside accounting departments
- Use of obsolete software
- Straying from the usual process
- Fixing things that don’t need any changes at all
- Lack of motivation to make process improvements
Such challenges are why it’s important to forge ahead in changing the status quo. Integrating month-end close best practices can ensure speedier closing while maintaining the quality of everything it covers. These four month-end close best practices can help you and your team achieve success at month-end:
Assemble a power team
Key to successfully completing month-end closes depends on the workforce assembled. Before choosing members of the power team, research their work ethic. You can’t push one member to interact with others if there’s no self-initiative. It may also affect the workflow of other members as well.
Conduct a review of potential members and decide. Procure a power team and champions of the process that will contribute to a more efficient and effective month-end close!
Build a project charter
Build a detailed project charter. This should outline team goals broken down into objectives which ensures a vision of incorporating month-end close best practices into the actual month-end close.
Only objectives that align with the process should be included. Connect objectives with each other and organize them so there is a coherent flow. Otherwise, the team’s performance may be affected.
Streamline the whole month-end process
A successful project charter will help ensure a streamlined month-end close process and help to ensure your team’s morale and performance. The process will also secure more free time and release high-quality output that’s accurate and timely for the management.
Once the power team is in place and the process has been streamlined, you can do away with a lot of manual and non-value-added administrative activities by implementing automation around the month-end close. This allows everyone to be on the same page and provides real-time insight into the process.
The financial month-end doesn’t have to be stereotypically hectic. Incorporating these four month-end close best practices to the best of your team’s abilities will help.