The Financial Leader’s Monthly Action Plan: Finish strong by closing your books fast

We’ve released an eBook titled "The Financial Leader’s Monthly Action Plan." The Financial Leader’s Monthly Action Plan.” Each month, we are posting excerpts here on our blog.  For the month of December the theme is “Finish strong by closing your books fast.” 

As December descends, the year's end looms, and with it, the task of closing the books. For many organizations, this process can be a stressful, time-consuming burden — but it doesn’t have to be. By implementing strategic changes and leveraging technology, you can transform your close into a streamlined operation, unlocking valuable insights and driving informed decision-making. 

Why a fast close matters 

Accurate financial data is the lifeblood of informed decision-making. It allows you to track vital metrics, measure progress against goals, and identify areas for improvement. A slow close, however, delays access to this critical information, hindering your ability to make timely adjustments and course-correction strategies. This can have significant consequences, impacting growth, profitability, and even leading to potential crises. 

Efficiency as a barometer 

The speed at which a business can close its books serves as a barometer for the efficiency of its financial processes. A quick and efficient close signifies a well-thought-out process, maximizing resources. Conversely, a slow close is indicative of a cumbersome process — perhaps laden with manual steps and spreadsheet reliance — leading to increased labor costs and, consequently, higher General and Administrative (G&A) expenditures. 

Embrace change for greater efficiency  

The fear of change can be a major obstacle to progress. But clinging to outdated methods simply because "that's how it's always been done" can stifle your organization's efficiency and growth. When your processes no longer serve your needs, it's time to embrace change. This applies to people, processes, and tools. Remember, "No change, no change" – growth demands continuous improvement. 

The power of consistent controllership 

Consistent controllership throughout the year is pivotal for a smooth close. Documented procedures and a single source of truth for financials, coupled with real-time reporting and close procedures, contribute to an efficient and repeatable process. A consistent monthly close not only ensures a smoother year-end but also frees up accounting staff for high-value tasks. 

11 steps for a faster close  

Close your books faster by implementing this 11-step guide: 

1. Acknowledge the Issue: The first step is collective acknowledgment that there is a problem when it comes to speed. Once identified, it is time to make a compelling case for change. 

2. Executive decision: After making the case for change, executives must decide to accelerate the accounting close. The decision signals the start of the improvement journey.

3. Tiger team formation: Form a dedicated team with key stakeholders to explore continuous improvement ideas. Collaboration is vital for success. 

4. Detailed plan: Develop a detailed plan to coordinate moving parts and cross-functional tasks. A well-organized plan is the backbone of successful execution.

5. Policies and procedures: Create and update policies and procedures that align with the business's unique needs. Review them regularly to ensure their relevance, and make sure your people are following them. 

6. Tool selection: Choose the right tool for the organization carefully. An ill-fitting tool can be not just ineffective but also costly to maintain. 

7. Benchmarking: Compare the accounting close duration with industry benchmarks. Assess whether your processes align with best practices. 

8. Training plan: Implement an ongoing training plan to ensure policies and procedures are not just in place but actively used by the team. 

9. Human capital optimization: Ensure that the right people are in the right roles. Human capital is a critical factor in efficiency. 

10. Establish KPIs: Establish standard KPIs for accounting close and other financial functions. Consistency in measurement is essential for improvement. 

11. Continuous improvement: Foster a culture of continuous improvement, making the finance and accounting team a valued asset to the entire business. 

“I hate to call anything perfect, but this is pretty darned close to perfect. I wish we had found Unanet before we went through our initial Costpoint implementation.”  Semper Fortis 

Suggested resources 

Get even better at closing faster by reviewing the following reading: 

• Energy Solutions Gains Greater Transparency Into Their Projects 
• RELYANT Global Implements Unanet Financials to Drive Efficiency