Drivers, Key Considerations and How They Reflect on the Finance Department
Many CFOs and controllers find themselves in a bind. They look for ways to give the finance department a more strategic role in their company, yet they cannot provide the resources finance would need to be able to handle core functions quickly and efficiently. Our benchmark research “Trends in Developing the Fast, Clean Close” found that some companies are actually taking longer to close than they did at the time of our previous research on this topic. The close is taking longer for these companies because finance organizations have failed to automate as much of their closing process as possible and they are using inappropriate software to manage it.
This is not a trivial matter. Companies that close within five or six business days enjoy several advantages over those that take longer. Closing promptly reflects efficient utilization of resources; such companies are able to spend more time on higher-value, more strategic activities. Faster closers also are able to review their final results sooner and so can be nimbler in seizing opportunities or dealing with risk.
For both these reasons, finance departments seeking to become more active
partners with the rest of the business must be able to close within one business week; doing so is a sign that they are capable and should be taken seriously. In addition, companies that are required to provide financial statements to public investors or regulatory agencies gain time to prepare these statements and related commentary if they close fast.
Download the Research Perspective "The Fast Close Imperative" and learn how to shorten your close cycle and the impact it will have.