September 15, 2021

Achieving Collaborative & Agile Virtual Accounting

7-minute read

Like most accountants, you've probably wasted cycles waiting for reviews or a sign-off, whether it's for reconciliation, a financial statement, or some other accounting tasks. Those dependencies and wait times run up the clock, extending the close and blocking other work from continuing.

It's easy for those asks, and many others, to sit in email inboxes and get overtaken by other work.

Accounting complexity has increased, with more standards, more systems, and more procedures. Plus, there's more back-and-forth between business units and shared services. Not to mention, the role of Accounting has expanded, with greater expectations around business partnership and strategic input.

Yet, the way we coordinate work hasn't changed much for a long time.

And one more thing: Every accounting function is now more virtual, with more staff working from home than ever before. For example, Gartner recently found that nearly 3 in 4 CFOs plan to move some employees who previously worked onsite to work from anywhere permanently.

These all add up to being fertile ground to improve collaboration. And that's essential to streamline processes in and out of the office. Ultimately, enhancing cooperation reduces accounting friction—indispensable for a faster, more efficient, and harmonious close.

Retooling Accounting to Work Collaboratively

Your first port of call to improve collaboration is to examine your existing processes and technology and remove the roadblocks that slow the accounting workflow.

Document the Data Roadblocks, Role-by-Role, Task-by-Task

One of the most common challenges revolves around the often onerous and repetitive nature of data management and processing. For example, if accounting work constantly requires manually downloading data extracts from the ERP, subledgers, and banking sources into spreadsheets, this is a bottleneck. If there are dependencies on IT or other personnel to get it done, it can further exacerbate the issue.

Similarly, if data, say a bank file, is buried on an individual's laptop and is hard to share or difficult for others to securely access, that's a barrier too. The same can be said for supporting documentation that's tucked away in paper binders.

This all leads to redundant work, where data is being extracted, unified, and manipulated before it can even be used for analysis, substantiation, or other key activities.

Get a handle on where the data landmines are in your close process by reviewing each line on your close checklist to see where the data dependencies are, like extracting bank details, invoices, payments, or combining data from multiple sources into spreadsheets.

Identify where the data inputs are, how much time and effort it takes to retrieve the data, and whether the task owner relies on other staff to extract the data or complex SQL queries.

  • Minimize data silos on laptops and desktops and reduce the need to manipulate and format data manually. When data is extracted or refreshed, it often cannot easily be accessed by other stakeholders on-demand.
  • Shift towards scheduling extracted accounting data and transactional details feeding downstream close processes, versus relying on individuals to run manual extracts.
  • Look to centralize refreshed data extracts and establish secure online sharing so that all task owners can access a single version of the truth without having to request it or perform a redundant data pull.
  • Carefully evaluate technology options to streamline data flows, and centralize management, whether cloud financial close solutions, online file sharing, data preparation tools, or those that provide ERP connectors for scheduling data feeds.

Enable More Agile & Seamless Remote Work

It's hard to admit it, but even now, many legacy accounting tools or those that were developed in-house were never designed to run efficiently over the internet, whether for running a transactional report, performing an accrual, or managing intercompany accounting.

That can be a huge productivity problem, especially when teams are primarily working from home. The user experience can be slow, patchy, or in some cases, unusable, whether entering a journal or hunting down a payment to process against an invoice.

Some of these usability bottlenecks can severely drain productivity from accounting staff—turning something that would typically take minutes into an hours-long battle to complete. It can be excruciating for those working from home.

Take the time to:

  • Identify tasks that require manual effort, in-person touch points, or manual hand-offs. These are the low-hanging fruit.
  • Gauge where there are any performance and productivity issues in the tooling Accounting is using, especially for repetitive processes.
  • Decide whether to optimize, augment, or replace/upgrade. For example, optimizing may mean making configuring changes to the app, so fewer clicks are required. Augmenting may mean adding a web-optimized app, like a financial close solution streamline journal entry. It may finally necessitate replacing a legacy tool completely or upgrading it to the latest version (in Chapter 6, we cover how to sequence upgrades during modernization projects).

As the WSJ CFO Journal noted, "Operating many applications in the cloud can enable the organization to flexibly scale capabilities, which may help your company adapt more easily to the need to 'virtualize.'"

Accounting apps built for the public cloud typically have less demand on in-house infrastructure and typically already provide SSL, multi-factor authentication, encryption, and robust security measures. Plus, they are generally 100% web-based to maximize remote productivity.

Trim the Meetings & Email Ping Pong

Zoom and Slack have long replaced in-person meetings. But solely depending on them for collaboration puts even more pressure on the manual checklists for tracking everything.

Modern accounting organizations have moved from spreadsheets to browser-based checklists and task management, invariably delivered in the cloud. Doing so allows every accountant to securely access and update the actions and next steps from anywhere, in real time.

Moving to a centralized task management hub enables the whole team to collaborate on checklists, tasks, dependencies, reviews, supporting documentation, and other close activities to keep everything moving.

Accountants don't need more tools to log into; they need less. So, it's essential to think about not only enabling accountants to smoothly move from tracking work to doing the work—such as performing reconciliations, posting journal entries, and other activities.

Suppose you move to a task management solution to orchestrate work. In that case, you'll want to plan to avoid "spreadsheet reversion proactively"—when it isn't flexible enough to manage accounting tasks, calendars, supporting detail, etc., and teams revert to spreadsheet checklists.

Ensure your task management strategy minimally supports:

  • Reconciliations and journal entries
  • Accounting checklists
  • Period-end tasks
  • Dependencies
  • Status, reviews, and approvals
  • PBC lists
  • Compliance controls
  • Comments and audit trail
  • Close calendars
  • Recurring tasks and entries
  • Storing supporting documentations
  • Task dashboards and reporting

For large organizations where accounting is across business units and subsidiaries, you'll want to verify that any close management tool has the flexibility to handle each local accounting team's specific period-end list.

Reduce Institutional Knowledge

Some organizations still find that knowing how to sequence, perform, review, or approve critical financial close tasks is stored in the brains of a few employees.

The reliance on this undocumented institutional knowledge makes it hard to ramp up new owners, and spreadsheet-based checklists make it challenging to assign new task owners on the fly when the need arises.

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Evaluate each close task, its documentation, who performs it, and who can act as a proxy when needed. Shift SOX/internal controls information, all undocumented knowledge, and best practices into a shared, centralized, and accessible repository that can ensure smooth reassignment of tasks when needed.

Nurture a Collaborative Audit

Collaboration isn't just essential within accounting, but also between accounting and internal and external auditors, as well as key stakeholders. Audits are painful at the best of times. They can be even more challenging when everyone is virtual and remote.

According to a SOX & Internal Controls Professionals Group survey, 73% said they still use desktop tools like Excel and Word as crucial components of their SOX/IC.

The cloud can enable secure access to centralized, real-time information from anywhere for role-based auditor self-service. This reduces audit costs and effort and can allow control owners and internal audit to operate more closely together. At the same time, external auditors can remain independent of the function.

And when the underlying process is automated, the nature and extent of audit testing is reduced. This enables a more preventive, proactive, and self-service audit model that saves everyone time.

In a nutshell, everyone should be empowered to work from a common, unified, and up-to-date environment accessible from anywhere so they can self-serve.

Get your free copy of Modernizing Accounting For Dummies to read the rest of the book. It provides a roadmap to help you move to modern accounting and drive finance automation at your F&A organization.

Tammy Coley

Modern Accounting