There are so many moving parts to running a successful business, and it may seem as though things never slow down. No matter how much is accomplished on any given day, there are always more details to attend to—both big and small.
A global study conducted recently shows that, on average, 26% of an employee’s day will be dedicated to completing inefficient administrative tasks manually. More specifically, the study revealed that 26 minutes of the average employee’s day is wasted due to outdated technology.
Intercompany reconciliations and adjustments fit into this category as these steps are important to look at a business’s performance holistically. However, for many companies, it takes many hours to consolidate activities for multiple entities across various systems just to get the big picture.
For this reason, having a software system in place to expedite and simplify intercompany reconciliations can have a significant impact on month-end closing processes. Read on to learn about achieving a more seamless closing process, and save more time for meeting business goals and objectives.
Take Intercompany Reconciliations from Time-Consuming to Strategic
Intercompany reconciliations manage and resolve transactions among multi-location or multi-entity companies that are owned and managed by a parent company. This work is typically completed on a monthly basis, during which time finance teams will review and reconcile all intercompany transactions to make sure they balance and nothing is double counted.
The process is known to be an arduous one thanks to its complexity, which increases the potential for human error. Financial teams across business branches must accurately enter their data across different systems and platforms, which are often outdated. The alternative, which involves performing this process manually, is much worse—even for smaller companies.
Fortunately, multi-entity software that targets intercompany reconciliations has become more widespread, removing much of the grunt work and also improving accuracy. Such software can access and generate:
- Customized reports for efficient information gathering
- Month-to-month comparisons for budgetary analysis
- Digital copies of documents such as invoices to streamline and automate.
The Benefits of Automation: Focus Business Efforts on Growth
By using a multi-entity software to tackle tedious month-end processes, business owners and employees free up their time to focus on more important tasks. In fact, a 2020 In(Sight) report revealed that 54% of employees believed they could save 240 hours annually through automation. Considering the number of hours it takes to manually resolve intercompany reconciliations—not to mention, fix any errors that are made along the way—it’s likely that this is a realistic figure.
If a company is facing hurdles such as decentralized payables, inter-entity transactions, multiple currencies, and global consolidations, it may be time to consider how an effective automated solution could organize the month-end closing process. By automating more of the month end close, and gaining the insights on performance more quickly, business leaders can focus their attention on bigger goals.
Innovation is one thing that can’t be automated, and plays a significant role in the forward-moving trajectory of a company. With more time to set and pursue important goals, busy entrepreneurs can devote more of their energy to getting their business to the next level.
Automated intercompany features will save your business valuable time and, ultimately, money. Having a software solution in place streamlines and organizes the month-end closing process for businesses, leaving less room for error and allowing more energy to be conserved for growth and innovation. Reach out to Proseer, and learn how you can spend more time on what really matters.
