Managing the finances of a company is never an easy feat. Not only does the management of finances demands continuous tracking and monitoring, but it leaves absolutely no room for errors. The fact that a company bases its growth and expansion decisions on financial data indicates that even the slightest negligence of loopholes in the finance management model can lead a company towards instability, and in the worst case, downfall.
One of the most critical stages during the management of finances is the financial period close. Just the name gives the finance team shivers, and that too is not the good ones. For almost all companies, the closing period means a time of high-stress levels, unbalanced data, overworked employees, and a significant decline in the company’s performance.
Getting things right during this ‘miserable’ time leaves the entire workforce exhausted, tired, and overwhelmed. As per studies, many companies need approximately 8 to 10 days to get through the closing period.
When it’s time to close the books, a company must have tested strategies that might help reduce the time needed to complete the process and leave some room for the employees to breathe. One strategy has passed the test of time and has shown almost non-existent loopholes.
We’re talking about continuous accounting.
In this era where technology is the main driving force of the world, opting for smart, tech-powered strategies, such as continuous accounting, is the wisest choice ever. The only way that businesses can enjoy a faster close is if they address the following issues.
- Tedious, manual data-entry
- Exposure to high risk of human errors
- Losing important documents, such as invoices, bills, and receipts
- Duplication of data
- Unbalanced numbers
- High chances of fraud
Continuous accounting is that powerful strategy that allows companies to turn things in their favour during book closing.
The question that stands is ‘what exactly is continuous accounting?’
Understanding Continuous Accounting
If you’re new to this term, you’re not alone. Many business owners that, even today, rely on traditional and obsolete methodologies may find themselves here (no offence). It’s time to change things and opt for a smart strategy.
For starters, continuous accounting is a product of the tech revolution and digital transformation. The concept behind this strategy is the automation of time-consuming tasks while adding control and period-end tasks within the finance management landscape.
It is most definitely the perfect replacement of traditional accounting methodologies as it embraces technology advancement, leverages information technology, and revamps finance operations. There are certain principles of continuous accounting, and each of them contributes to reducing the financial period close time.
- Automation of repetitive and mechanical procedures
- Even distribution of workload with smart management of accounting calendar
- Establishment of continuous accounting culture
The Many Benefits of Continuous Accounting
If you do your research as a business owner, you must know how strongly experts emphasize integrating technology into a company’s business model. Well, the emphasis is for all the right reasons. With a smart financial system, you get a chance to adopt the strategy of continuous accounting. There are a plethora of ways your company can benefit from this.
Smart Management of Tasks
Organizing, correcting and processing an entire quarter or a year’s accounting data in a matter of days is as impossible as it sounds. That’s the thing; it doesn’t even sound easy. The right approach, in this case, is to evenly divide the workload over the course of a financial closing period.
With a smart management system, such as Oracle NetSuite, things can get organizing throughout the period. It puts an end to the need to get that bulk data processed in a week or ten days.
Effective and Efficient Analysis
One of the most stressful situations for a company arises when it’s time to make decisions. Unfortunately, without a properly managed data bank, making result-generating decisions is not possible. It requires an in-depth analysis of every aspect.
When you spread finance data management over the course of a fixed period, your team will get more time to carry out in-depth analysis. NetSuite equips a company with the necessary tools to gather data in real-time that provides actionable insights, leading to better decisions at the right time.
Not to forget, this extensive analysis allows companies to develop and implement smart, data-backed strategies.
Adding Value to the Organization
It takes great effort to manage finances, and when things are manually done, it can exhaust the workforce. This disables a finance team from focusing on any other strategies as they’re all deeply invested in effectively closing the books at the end of the financial period.
When smart tools such as NetSuite take over, allowing continuous accounting, finance teams can add value to an organization. They don’t have to waste their potential on getting manual and tedious tasks done. With continuous accounting, a finance team explores ideas and devises strategies that lead companies towards high revenue and, ultimately, high profitability.
In addition to these benefits, your company has better chances of adopting a continuous improvement strategy with continuous accounting. The finance teams have the room to optimize internal processes, leading to efficient finance management. This equips the company executives to make decisions that are strongly backed by data. The strategy that involves continuous accounting also leads companies towards improved business agility.
If you’re looking for ways to adapt the continuous accounting plan, you need to think ahead of the game and integrate the world’s most popular business management software suite, Oracle NetSuite. Offering a set of top-notch finance management software, adopting the continuous accounting approach becomes simple, easy, and convenient with NetSuite.
Partnering up with a Certified Oracle NetSuite Alliance Partner, Folio3, you can effectively implement a finance system that is tailored to your company’s needs and integrates perfectly into your business model. It is time to get rid of the financial period close stress by adopting a strategy that not only eliminates the possibility of chaos but leads your business to smart management.
