The Importance of Time to Close
An important measure of the effectiveness of a finance and accounting department is the time it takes to close the books. Finance department executives should take a fresh look at this decades-old topic to assess the benefits of a faster close to the entire organization, from turning early actionable insights into performance to providing a working environment for the accounting staff that can attract and retain the best talent. This reassessment is warranted due to the relatively recent availability of full-featured cloud-based software that is affordable to midsize companies and readily managed by their finance department.
Our recent Smart Close Dynamic Insights Research finds that organizations using the right technology complete their accounting close sooner than those that do not. Software that manages the consolidation process is essential: 67% of participants that say their software manages the process very well can close within six business days compared to 36% that do not. Dedicated consolidation software can enable an organization—not just very large corporations—to streamline and accelerate its close while reducing the risk of financial statement errors. Ventana Research asserts that by 2025, one-half of midsize and larger organizations will use close management software to speed their close and achieve greater control of the process.