If there’s anything that can make a CFO sweat, it’s the demand for urgency. How many CEOs have implied, or downright said, “I feel the need…the need for speed”? For CFOs, who spend weeks, or even months, consolidating accounts for multiple legal entities, speed is often the antithesis of a stalwart report.
Think of this: In an Adra Match survey, 90% of CFOs were under pressure to close books faster. Let that sit for a minute. Almost everyone feels rushed to deliver the goods. How does that affect the results? Well, how does rushing ever affect results? The same report shows that only about a third of those surveyed were satisfied with the results. Likewise, only 29% of CEOs even trusted the numbers.
Let’s extrapolate that nonsense. This means that you, as a CFO, are rushing to report numbers that have a 70% chance of being considered garbage. This is not a sustainable picture for financial accounting.
The Traditional Method of Financial Consolidation
Consolidation has long been a standard element of accounting. While the method of consolidation for many has gone unchanged, the complexity and the timeline to completion has drastically expanded and contracted, respectively. These days, CFOs are facing down the barrel of geographic growth, jurisdictional dissimilitude, international and intercompany operations, combined with skintight deadlines and demands for transparency and enhanced financial integrity.
Traditionally, the consolidation process is four steps.
- A close calendar sets target dates for closing deadlines and submission to corporate accounting groups.
- Results are received and manually aligned and harmonized with accounting structures.
- Spreadsheets are jockeyed for consolidation and reporting. Balances are adjusted. Eyes are rubbed.
- Consolidated accounts are placed into the reporting framework.
All in all, the manual manipulation of accounts can drag expediency like a sale or like an anchor. This process is time-consuming and prone to error. In fact, according to a Robert Half survey, 52% of US firms reconcile accounts manually. To quote late night television, “There’s got to be a better way.”
The Next Generation of Financial Consolidation
In a world where AI is transforming accounting procedures, automation through cloud-based ERP is meeting the new wave of demands placed on CFOs.
Cloud-based ERP places all entities onto the company’s ERP system automatically. This means no hardware or software to install, and no configuration. With a little bit of training, new entities are up and running regardless of location. New staff, new locations – changes in business structure are handled easily, and workflow is productive and automatic.
As your business grows, this new nimble, cloud-based accounting software can help you meet the demands of regulatory bodies, and allow data analysis at any level, across any entity, without the need to manually consolidate results.
Company-wide data is on the desktop of every corporate accounting staff member. No longer are endless email requests and inquiry forms required. Everything is at your fingertips, and collaboration is at its apex.
What this gives you, at the end of the day, is better insight. Cloud-based ERP gives you the ability to drill down into your data with greater speed and greater transparency.
With Alta Vista and Sage Intacct ERP software, you can achieve the growth you need, with the speed and accuracy you demand.
Contact us today to get started.