Everyone wants to be a top-performing company, and there’s no better time than now for CFOs to help them do so.
If by the middle of the month you’re barely finishing the monthly financial close, your firm ranks . . . somewhere in the middle of the pack.
The benchmark data from Houston-based APQC was just one part of an in-depth look at how CFOs and their teams are grappling with financial close management (FCM) that was recently published on TechTarget, but they’re significant enough that they’re worth highlighting right off the bat:
- 12 days or fewer: The time the top companies completed the financial close process.
- 18 days or more: The time the bottom performers needed to close the books.
- 15 days: The median cycle.
Of course, technology theoretically allows any organization to at least aspire to become one of those “top companies,” but experts in the Tech Target piece suggested CFOs should think carefully about what “the big picture” of the financial close should look like.
“A CFO also needs a tool that provides a user interface with all the necessary, high-level information in real time on the first screen and the ability to drill into specific accounts or specific divisions for additional information, says Seth Lippincott, an analyst at Nucleus, in the article. “CFOs should take advantage of all the components of a vendor’s financial close suite, beginning with the account reconciliation component as well as some of the foundational components for master data management, such as the chart of accounts.”
When the financial close process improves, lots of other opportunities open up for the organization as a whole but specially for the CFO. The question, explored by Gary Cokin, founder of Analytics-Based Performance, is whether they’re really committed to it.
In a recent post on Information Management, Cokin argues that the discussion about finance department transformation has being going on for so long now that executives are rapidly reaching a make-or-break moment:
The CFO’s finance and accounting function is uniquely positioned at this moment in time to accelerate the adoption rate of enterprise and corporate performance management (EPM/CPM) methods along with emerging business analytics to gain crucial insights that were previously inaccessible and truly facilitate business innovation in new and novel ways,” he writes. “Finance and accounting professionals were born with a quantitative aptitude – which technology will only further fuel.
Creating a faster, more efficient financial close is not only about bringing value to the organization — it’s taking a step closer towards realizing the full potential of the CFO’s role.