For a financial transformation to move at a rapid rate, become more responsive, more transparent and less manual, it is important to know about the three basic pillars of this transformation. Popular finance and accounting organizations are transitioning into a more partnership role and analytical function by developing their business plan around 3 pillars that include process automation transformation, close process transformation, and integrity and risk transformation.
Risk and Integrity Transformation
Creating trust and keeping pace to lessen regulatory, reporting, and strategic risk is the main pillar of finance transformation. By way of strong automation, an organization can achieve improved integrity, both in their controls and balance sheets.
Though task automation and management services enhance work efficiency and speed, data integrity provides the biggest benefit by avoiding the professional and organizational exposure that results from an inaccurate filing or restatement. Automation also assists in highlighting balances and transactions that go beyond control thresholds. In this way, it ensures that all reports are reconciled back to its original form.
Close Process Transformation
Close processes are generally run through instinct, gut, and collective knowledge, as opposed to a centralized, defined and orchestrated process and workflow. With several people involved and large number of spreadsheets getting accumulating constantly, collaboration is found to remain stuck in conference calls and email, with restricted visibility in the process.
The key to the success of organizations is clarity. Each stakeholder present in the organization has got a well-defined and a clear perspective of what should occur at each step, when it should occur and what are the factors on which it depends on. It is important to have milestone tasks to assure the right sequence, rollup and flow of related activities.
Automatic notifications warn stakeholders about pending tasks and to enable management to deal with bottlenecks and overdue tasks. Internal controls reduce material risk while avoiding unessential controls that stand as an obstruction in the way of accomplishment.
Process Automation Transformation
Manual tasks drain finance and accounting efficiency. The issue often leads to associated frustrations among accountants who fail to use their skills properly and perform repetitive work. A key enabler leverages process automation at several different levels in the same accounting division.
Executing each of 3 pillars is of utmost significance to increasing the reduction in transaction based processing in accounting. With the right inclusion of people, technology and processes, it can get lowered by 40 percent. By way of automation, orchestration, and data integrity management, organizations can lower resource overhead and enhance cycle times and data quality in the financial close.