Financial Close Automation: Best Tools and Tips for CFOs

You’re all too familiar with the financial close process. And, by this point, you’re probably looking for a way to standardise, expedite, and optimise the repetitive and inevitable process of zeroing out your account balances at the end of each period. With financial close automation, this process becomes seamless, transparent, and hassle-free.

Here’s how automation all can work for your business, plus a look at some of the best financial close solutions.

Coming Up

1. What is Financial Close Automation Software?

2. What are Common Features of Financial Close Automation Software?

3. What are Challenges of Financial Close Process?

4. What are the Benefits of Financial Close Automation?

5. How to Choose Financial Close Software?

6. What are the Best Financial Close Automation Tools?

7. What are Best Practices for Financial Close Automation?

8. Wrap Up

What is Financial Close Automation Software?

Financial close software, also known as accounting close software, automates the financial close software. Controllers and accountants typically manage the financial close process manually, which becomes time-consuming, monotonous, and error-prone.

Instead, financial close automation software can integrate with your existing toolstack, pull relevant data, cross-check information, and prepare reports and dashboards in real-time. These capabilities ensure that your team is always up-to-date with the financial status of your organisation, as well as alerted if anything isn’t lining up properly.

Additionally, these financial close solutions commonly integrate with corporate performance management (CPM) features and can be used for budgeting and forecasting.

What are Common Features of Financial Close Automation Software?

There are various options for financial close automation software available. When researching the many tools, it is recommended to look out for certain features, such as:

• Create a month-end close process checklist
  

• Transparency: to view the status and progress of financial close processes. For example, with a financial close automation tool like SolveXia, users with access to the software can always see what step the process is currently in. The software also helps to optimise approval processes so that nothing slips through the cracks or gets delayed waiting on a sign-off.
  

• Executes account reconciliations: such as from bank reconciliation to intercompany reconciliations and everything in between. This means that the system can automatically cross-check external documents with internal ledgers to spot discrepancies and alert your team if a reconciliation is required.
  

• Access and safe storage of historical records: can be used to forecast the future and refer back to, if need be.

• Financial close process reporting: to ensure compliance.
  

• Individual task lists: so every user is aware of their responsibilities and held accountable.
  

• Spreadsheet integrations and legacy system integrations: means that you will not have to sacrifice any existing data.
  

• Process automation
  

The above list covers most of the necessary features of an accounting close software; however, some vendors provide additional features, such as: role-based permissions, sale forecasting, and payroll integration.

With a tool like SolveXia, not only do you get financial close automation features, but our software can perform advanced analytics that provides your team with deep insights to make the best decisions possible, at any given time.

What are Challenges of Financial Close Process?

Even though the financial close process is constantly performed within finance and accounting departments, there are many hurdles involved.

Naturally, one of the most common pitfalls of the process comes down to the amount of time it takes to perform, especially when data is stored across systems and your team’s computers. Siloed data can cause incorrect reporting, as well as add to the time it takes to review documentation.

Additionally, the financial statement close process can consist of:

• Error-prone and manual data entry and transformation
• Lack of visibility for management
• Risk of financial reporting errors that threaten compliance and can cause financial and/or reputational damage to the organisation
• Frustrated employees who are tired of performing tedious tasks
• Disparate processes that remain unstandardised
• Unsecured data storage and management

What are the Benefits of Financial Close Automation?

According to data from Gartner, automation software has been able to save finance departments 25,000 hours of rework per year, which would have otherwise been conducted due to human errors.

The time-saving element of financial close automation is only one of its main benefits. By deploying an automation solution like SolveXia within your organisation, your team, executive leadership, and stakeholders all benefit. The advantages include:

• Real-time management of financial processes from start to finish

• Data that is securely stored in the cloud and accessible as needed

• Digital finance workflows that operate smoothly

• Freed up time for your team to work on high-level tasks rather than data entry and report generation

• A way to integrate all your data across systems for accurate reporting and enhanced analytics

• Shorter cycle to close the books and the ability to perform account close processes as frequently as you’d want (you no longer have to only wait until the end of the month)

• Reduced fraud risk as you can spot issues quickly and rectify them

• Better financial controls which translates into increased compliance

• A clear understanding of roles as the process is standardised and highly structured

How to Choose Financial Close Software?

Now, you are equipped with the types of features that are useful to have in financial close software. But, how do you choose the right tool for your team? It’s important to review the following factors:

• Scope: Decide your organisation’s overall goals to see whether you want an integrated system that can do more than just financial close or if you are okay with a point solution that solely manages account close procedures.
  

• Integrations: It is likely that your organisation already leverages some form of software or data management tool. The automation tool you choose to deploy will need to work alongside these existing tools, so make sure that it can send and receive data with existing systems.
  

• Scalability: Some products are intended for small teams, whereas others are designed to work for enterprises. No matter where you currently stand, consider your future growth and the need for scalability with your chosen software.

What are the Best Financial Close Automation Tools?

We’ve talked about how to choose the right tool, as well as the necessary features. Here, we will share some of the top of the line automation tools on the market that have demonstrated month-end close best practices automatically.

1. SolveXia

SolveXia is a human analytical automation software that has helped finance teams, as well as other industries, automate their processes at scale. SolveXia replaces the need for manual spreadsheet-based reporting by connecting data, automating entire workflows, and saving your team time. The low/no code solution can be deployed instantaneously and works alongside legacy systems, so your data is never at risk of being forgotten.

2. BlackLine

BlackLine is a financial close automation tool that can perform account reconciliation and improve internal controls surrounding financial processes. Most commonly, BlackLine services enterprises within the financial services industry and has received great reviews in regards to its easy  implementation.

3. Workiva

Workiva replaces the need for manual work across departments, including: accounting, financial services, FP&A, legal, and auditing. The automation software unifies data, manages approvals, and executes workflows that can handle all financial close processes for your team.

What are Best Practices for Financial Close Automation?

Whether you’re just getting started with financial close automation or looking for ways to optimise your practices, here’s a quick look at some of the best practices you can follow.

1. Process improvement: Many organisations continue to run processes as they’ve always been run, whether or not there is room for improvement. By reviewing your processes, you could find areas where there are wasted steps. Even with automation solutions, you will want to cut out any unnecessary steps to minimise the time it takes to get work done.
   

2. Intelligent process automation: Once your team has become comfortable with standard automation solutions, it could be beneficial to continue along the automation journey by incorporating intelligent automation, or a robotic process automation solution that is combined with machine learning. This means that the system itself can make cognitive decisions based on data patterns and algorithmic learning.
   

3. Monitor the close schedule: Share, track and monitor the close schedule closely. With an automation solution, this is easily performed by way of visual dashboards. With easily digestible data in the form of visual dashboards, stakeholders and executives alike benefit from transparency.
   

4. Automate reporting: Financial close automation software not only executes the tasks for your team, but it can also be programmed to automatically send reports. Organisational leaders will greatly appreciate receiving these informed reports on a regular basis.

Wrap Up

The financial close process is here to stay, and it impacts every organisational decision. As such, it’s up to you and your team to decide how you want to deal with it month-in and month-out. By deploying financial close automation like what SolveXia offers, you can streamline the process, alleviate your team’s to-do lists, and benefit from accurate data and reporting.

There is no need to waste time performing manual work when automation solutions can expedite the process and offer a more secure way of getting the valuable tasks completed.

Like Mckinsey reports, “About a third of the opportunity in finance can be captured using basic task-automation technologies such as robotic process automation.” Financial close processes could serve as just the beginning.