© 2020 RSM US LLP. All rights reserved.
Close and Reporting Services
Take control and gain efficiency in your financial close process
The financial close is a critical function within every organization, acting as the bridge between processes and the ability to successfully report financial results. Accounting and finance professionals rarely look forward to the close process, but faster does not always mean better. Organizations can “right-size” the close process and gain efficiency by implementing a risk-based, data-driven approach that incorporates materiality.
Due to underlying issues and inefficiencies, many middle market companies are constantly in “close mode.” For example, common issues—staff shortages, manual processes, inadequate technology and unreliable data—ultimately create an unmanageable close process. In addition, organizations are constantly tasked with reporting more in less time, and demands for greater transparency and governance have increased. Each of these scenarios moves organizations away from a traditional close.
At RSM, we understand the challenges and constraints on your financial close, and thus aim to alleviate those pressures and optimize your organizational process. There is no defined length of the ideal close process—instead, we work with you to develop a practical framework that considers your unique factors and objectives.
All organizations possess the same four basic components of the close process: subledger and journal activity, reconciliations, consolidation, and reporting and analytics. RSM facilitates improvement on each of these components to transform your close into your desired future state, delivering more efficiency and insight into operations. For example, we can lead your organization through several key steps:
- Digging into the data: Gain an understanding of your current-state financial transactions and associated timing and materiality
- Reviewing policies and procedures: Analyze current policies and close activities to determine alignment with organizational close goals
- Analyzing roles and responsibilities: Align the right people with the right duties by leveraging capabilities and providing growth opportunities
- Reviewing and optimizing technology solutions: Architect data flow among technology systems that contribute to close and perform “fit for purpose” analysis
How can we help you?
Ultimately, our experienced team creates a practical close process for your organization, tailored to your specific needs. Specific considerations tied to creating this practical close include:
- A risk-based approach: Evaluating critical data components, analyzing journal entries and reconciliations, and questioning each account to determine risks of certain activities
- Policy considerations: Looking at common areas for efficiency gains, including materiality thresholds, write-off policies, controls and reconciliation and subledger close policies, as well as internal and external reporting
- Hard versus soft close: Determining whether you need a more rigid close, focused on surface-level fixes, or a less-thorough, less-precise close that is more agile and leaves more time for analysis of issues
- Bucket tasks: Eliminating some tasks while standardizing and optimizing others that are still needed
- Technology investment (link to close automation page): Considering integrating modern transactional, storage and reporting systems that drive finance automation across critical business processes and data elements
By improving the four key components of the close process and developing a practical close model, RSM can help you achieve a shorter close time with more engaged staff, increase visibility during and after the close and create consistent, reliable reporting for more informed decision making.