making the controllers job easier

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© Ventana Research 2014

Ventana Research: Making the Controller’s Job Easier

Making the Controller’s Job Easier

Process Automation Delivers Quality,

Speed and Efficiency

Research Perspective Sponsored by

https://www.blackline.com/

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Table of Contents

Controllers Need More Time 3

Automating Financial Processes 4 Achieve flawless execution. 4 Ensure process compliance. 4

Enhance process visibility. 4 Improve auditability. 5

Strengthen communication. 5 Be able to plan ahead. 5

Software Requirements 5

Using Automation to Close Faster 6

Improving the Controller’s Effectiveness 7

About Ventana Research 8

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Using software to manage and control many of the finance department’s systems and processes can make the controller’s job easier and make the role more strategic and productive.

Controllers Need More Time The role of the controller is a demanding one. To be successful in this position, an individual must possess strong interpersonal and communications skills. He or she also must be superbly well organized and an expert at multitasking and have a keen eye for details. These capabilities are essential because the controller must stay on top of the myriad details and process threads in the finance organization and direct the department as it responds to the inevitable disruptions and

adapts to changing conditions in the business. Using software to manage and control as many of the finance department’s systems and processes as possible can make the controller’s job easier and make the role more productive and potentially strategic. That’s because automating process supervision (keeping track of when a process should start and end and who is on time or behind schedule, for example) will free the controller to focus on the parts of the job that require experience and judgment.

Business computing has made great strides in automating what once were manual processes – processing transactions, keeping and consolidating the books, managing logistics and supply chains, and tracking and managing sales cycles, to name just a handful. Software that automates the execution and monitoring of business processes is particularly valuable for managers. Automation saves time and helps individuals work more efficiently. It can ensure that processes are performed consistently, that all steps are completed in the proper sequence and that all necessary approvals and other sign-offs are in place. In automating their processes, one challenge companies face is finding a practical solution that is affordable and easy to implement, maintain and modify as the business evolves. Many purpose-built finance and business applications have some form of automated workflow built in, but finance processes often involve the use of multiple applications, which means that integrating workflows may not be feasible.

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Moreover, finance organizations are heavy users of spreadsheets. Tracking processes that involve spreadsheets and confirming that work has been completed and approved typically involves a stream of email or instant messages. Such processes add to the controller’s workload without adding value. Controllers can benefit from software that helps them manage tasks (especially the financial close) that are time-sensitive, involve multiple applications and spreadsheets and require approvals and other confirmations that each step has been completed. This is especially the case for the accounting close-to-report cycle.

Automating Financial Processes There are several important reasons to use software to automate the management of finance department processes. Doing so makes it possible to:

Achieve flawless execution. By this we mean consistently performing a process in which every task is done in the proper sequence and is performed properly, reviewed and approved where necessary and completed on or ahead of schedule. Consistent execution is important to managing a process.

For example, 71 percent of participants in our benchmark research said that they were able to shorten their accounting close by controlling the process consistently.

Ensure process compliance. An automated system can manage all necessary approvals and sign-offs and certify that they have been performed in a timely fashion.

Enhance process visibility. Automation can enable the controller and others to quickly monitor the

status of a process and its constituent tasks. They should be able to see which tasks have been started, completed, reviewed and approved, as well as which tasks are behind schedule.

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Improve auditability. Automation provides greater control over a process and the ability to confirm how tasks were performed. Systems that centrally collect approvals and confirmations give external and internal auditors easier access to these documents than do other systems that, for example, handle them through an email system.

Strengthen communication. An automated system provides notification to all necessary parties that work has not started, is behind schedule or overdue as well as noting when work has been completed.

Be able to plan ahead. An automated system should be able to create a calendar of periodic processes such as the accounting close. Publishing a forward-looking calendar (ideally six to nine months ahead) gives everyone involved a schedule for planning ahead to anticipate schedule conflicts (such as other overriding duties) or work/life balance issues (such as a family illness or vacation).

Software Requirements To ensure that it promotes productivity and control, software that automates the execution of business processes must have the following capabilities and features.

• Process management is the ability to easily configure the sequence of tasks and their dependencies from start to finish. The software must be able to manage a broad range of tasks as well as configure and handle groups of tasks.

• Calendar management provides built-in awareness of “off days” such as weekends as well as fixed and floating holidays. For companies that operate globally, the system understands local calendars, holidays and practices as well as being able to manage time zones appropriately.

• Document management enables users to collect and store necessary attachments and attestations for easy retrieval. For companies required to file their financial statements with the U.S. Securities and Exchange Commission, this documentation is essential for compliance with the Sarbanes-Oxley Act.

• For communications the system must generate automated notifications that tasks must be started, have been completed or

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are overdue. Managers should receive notifications that a particular task requires reviews or has been performed. Dashboards should provide process owners with real-time visibility into the status of all elements of the process.

• Auditability shows that all work has been performed and enables viewing of exceptions. Auditors need to easily view roles, rules and responsibilities to confirm the soundness of the process. They have to trace actions to determine who did what and when.

• Control assures that only people with permission can access the system and view documents. Once documents are completed, the system secures them and makes them unalterable.

• Data integration manages the connections with source systems such as ERP and other software used for finance and business processes.

Using Automation to Close Faster One useful application of software automation is the accounting close including all the post-closing processes up to generating financial statements and creating disclosure documents. Automation is essential

for closing faster. Our research correlates how quickly a company closes its books with the degree of automation used in managing the close process. Companies that employ a high degree of automation are able to close their books in 5.7 days; that’s almost twice as fast as those that employ little or no automation. The most often cited reason why organizations want to close sooner, our research shows, is to be able to deliver financial and management

accounting information sooner. This enables companies to react faster with greater insight. But a faster close delivers many other benefits as well to the finance organization and the company in general. An automated close usually requires fewer resources to complete, especially temporary help. Companies that close their books within one business week said that speeding the close is important to reduce use

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The accounting close provides a specific example of the positive impact that process automation can have on efficiency and productivity.

of time and other resources and to improve employee productivity. For public companies it frees up more time to manage the disclosure process; this gives senior executives additional time to craft the management discussion and analysis and do a more effective job with disclosure documents generally. On a larger scale, an automated system that’s easy to configure enables companies to adopt a continuous improvement approach and quickly implement changes they find to be necessary.

Improving the Controller’s Effectiveness It’s easy to overlook the amount of time a controller spends supervising repetitive processes. That’s because his or her job consists not of one big task but of a constant stream of small ones: checking

details, making phone calls and dealing with email and instant messages. Because individually these activities blend into the background of a workday, it’s not hard to underestimate the additional time and resources that poorly executed processes consume. The accounting close provides a specific example of the positive impact that process automation can have on efficiency and productivity since it requires the coordi-nation of the individual steps in a particular order and handling all of the associated details.

Having software that automates management of the close can enable a company to accelerate the process and provide executives and managers with vital operating information sooner while reducing use of resources. A better controlled process also minimizes the risk of noncompliance with reporting regulations such as the Sarbanes-Oxley Act and can facilitate these aspects of an audit. A speedier close also allows more time for public companies to craft their disclosure documents and their narratives. Moreover, automating the mechanical aspects of a finance department process – particular the close – eliminates the need for the company controller to spend time actively handling this chore, enabling him or her to concentrate on matters that require the controller’s special skills

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and judgment. The controller will still be working long hours, but the time will be spent more productively.

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