Dedebt says that closing a business today takes longer than it did five years ago. Both within and beyond organisations are making it difficult for businesses to close efficiently.
External demands for a faster financial consolidation process
Customers, employees, partners, communities and others are demanding more transparency regarding the inner workings of companies as well the impact they have on the surrounding environment.
These are just a few of the most important issues.
Data Quality and Collect Errors
Companies with multiple branches or locations in the same area will need extra effort to get a “right” first-time financial consolidation process via https://consolidationnow.com/. Data collection through normalization and any other issues may be necessary.
- Manual data entry errors
- Late delivery of reporting units
- Mangel of validation or controls
- Poor integration of source systems
- Integration problems in multiple closely related processes
Intercompany transactions can delay the closing cycle. Both local branches and headquarters staff have to dedicate time to resource-intensive tasks. These include eliminating intercompany transaction, calculating group ownership, and minorities interests.
Poor performance for Consolidation Applications
Financial consolidation is always iterative. There are many rounds before finalization. Limited capabilities in financial close software could seriously hamper the process.
Automating financial consolidation is possible to reduce errors, speed up closes and increase staff availability. Staff that are not familiar with business processes or reporting systems could have problems without automated workflow.
Inefficient Audit Trails
Not only is it an internal issue where central finances may need to investigate and verify numbers, but it can also be an issue externally where close audit signoffs take place.