Continuous Accounting and Automation
With automation, figures can also be reported with a significantly lower risk of error. Automation is the basis for a change in financial processes and the ability for companies to react more quickly and agilely to any changes. Continuous accounting can enable the finance department, controlling and management to have valid and up-to-date financial figures at all times instead of just immediately after a quarterly or annual report.
Monthly stress level
Traditionally, financial statements must be ready by the end of the quarter or year and all information must be available for reports and audits, for example. To achieve this, financial experts with a traditional approach often still manually reconcile countless figures and accounts at the end of each reporting period, usually under a high level of stress: Documents are missed, errors are checked several times, needles are looked for in haystacks.
Every month, every quarter and every year, companies lose time that is urgently needed elsewhere. The reason: although selective automation has been implemented, this is without a consistent and comprehensive automation concept.
Worst case: The figures don't fit, decisions are wrong! If the figures at the end of a reporting period are not correct, a lot of time and resources have to be invested again. Even worse: in such situations, companies realize that they may be making the wrong decisions due to unreliable financial figures. This is one of the reasons why, in a new study by the market research institute Censuswide, which surveyed 1339 C-level managers and F&A specialists in companies worldwide on behalf of BlackLine, only 64% of German respondents said they had full confidence in the financial figures.
Best case: end-to-end automation with a concept. Continuous accounting with end-to-end automation, on the other hand, can prevent precisely this. The implementation of this process in a uniform platform standardizes the financial closing and auditing processes. This means that time-consuming manual clearing is no longer necessary and you can start directly with the specifications and analyses. There are no unusual peaks in the financial statements and errors are avoided. More importantly, ad hoc financial statements are possible, allowing finance professionals and management to react quickly and purposefully to events with a valid database.
Are F&A and management ready for automation and therefore prepared for continuous accounting? The fact is that almost a third of the C-suite and finance specialists surveyed by Censuswide are not sure whether everything is fully captured in their financial data. The problem: the data comes from too many different sources. This indicates that there is no end-to-end automation in place to implement strategies such as continuous accounting. The patchwork of individual automation islands that exists in many places only helps to a limited extent. The result: almost half of all respondents confirmed that lower visibility of cash flow, for example, makes it more difficult to react to market changes.
With continuous accounting, the workload is better distributed over the period - the balance sheet is always up to date. In times of rapid market changes, high energy prices, geopolitical conflicts and inflation, the constant availability of transparency in company finances is more important than ever before.
The continuous process of data collection and processing eliminates regular stress, minimizes errors and gives finance professionals time to put their skills to work for the company. With Continuous Accounting, CFOs and management have the ability to access accurate daily financial data and forecasts, making business decisions with impact much more secure and leading to greater integrity in the capital markets.