In the earlier article, we understand some of the reasons/justifications and challenges for a faster close.

So what can be some of the initiatives to drive a “faster close”:-

• Review the work flow/process ( refer earlier article)
• Increased automation – for example, online daily posting of sub ledgers integrated with sales and costing reports
• Reduced errors-accounts code validation to be done at source hence removing extensive error correction at the month end
• Discipline-strict cut-off procedures enforced with all your related companies ( subsidiaries, associates,etc)
• Reporting – the consolidation of results, production of monthly management accounts, production of management information using integrated software with the elimination of spreadsheets manual intervention
• The alignment the group’s chart of accounts amongst all related companies - adopting a single chart of accounts
• Close the accounts prior to the month end
• Reduced allocations
• Materiality guide for adjustments
• Automated accruals
• Weekly rather than monthly reporting cycles
• Automatic interfaces between financial and operational systems
• The use of portals
• Full online review and real time reporting
• Corporate adjustments are discussed and processed one week before cut-off
• Submissions are in based currency eg USD which provides a consistent view of the results
• A third party inter-company billing process leverages EDI systems for invoices, payments and receipts. This will then ensure minimal time spent at month-end on inter-company account analysis
• Have clear-cut policies on how to resolves disputes amongst inter companies

It’s important to establish high visible performance indicators for measuring both quantitative and qualitative terms the progress the company is making of its fast close objectives. There needs to have an evaluation of performance and variances from plan on a on-going basis. Special attention to the change process re: faster close by appointing “champion”/project sponsor who should take a very active role in ensuring the success. Don’t forget that there is also the need to gain the buy-in of key personnel involved in the closing process. If there are any organizational changes, this need to be communicated to the staff who are affected as soon as possible to eliminate uncertainty.

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