A strong Finance and Accounting environment has meaningful and well-documented accounting policies and procedures. Many corporate organizations have top-level policies and procedures to ensure compliance and regulatory standards exist throughout the organization.
As I travel, I am finding more and more F&A teams that don’t have any corporate policies or procedures in place. This makes it even more important for accountants to document processes (i.e. Desk Top Procedures or Process Documents) that support the financial statements.
Documenting the organization’s accounting policies and procedures in an automated system helps accountants and auditors understand and follow the accounting rules and methods required to produce accurate and reliable financial statements.
The Purpose of Accounting Desk Top Procedures (DTPs)
The Finance & Accounting Desk Top Procedure (DTP) is a communication and training tool. It should serve as guidance to properly process financial transactions and help your accountants understand how the organization’s accounting system works.
The goal of any accounting DTP should be to outline the policies and procedures accountants should follow for all accounting transactions, in order to produce accurate and reliable financial statements.
Additionally, Desk Top Procedures will help strengthen efficiencies, deliver best practices, and provide cross-training in your finance and accounting functions. More importantly, they will provide added support by back-filling vacations and sick leave, supplement the auditor review requirements in the organization, and create transparencies throughout your overall financial close process.
Implementing Desk Top Procedures
With BlackLine, DTPs can be implemented within Task Management. The task import template can be customized with fields relevant to your respective DTPs.
If this process isn’t automated yet, you can still apply these out of the box tools to get started by following these simple steps:
- Create a standardized Word document template for the Desk Top Procedures.
- Starting with your closing checklist items—journal entries, bank reconciliations, reports, account reconciliation processes, etc.—identify which tasks should have a detailed procedure document.
- Exclude daily tasks, such as email responses, filing, etc. These are not critical to the financial close process and should not be documented.
- Determine your frequency. How often do you want accountants to review and update these procedures? I recommend annually. Desk Top Procedures are owned by the accountants and can be updated at any time as processes change or are eliminated.
- Identify the approver. The accountant (preparer) will create the document and corresponding best practice to have a supervisor or manager review and approve these documents.
- Set the initiative. Kick off this project with a training session. Include critical information about why this is important, introduce the template you will be using, and set a deadline.
In my previous organization, we launched this initiative in early Q2 with a one-hour training introducing the importance and benefit of adding DTPs to our platform. There was time allotted for a deep dive review of our standard template and an open forum to answer all questions.
Our goal was to have all DTPs approved in the solution by the end of Q4. We were fortunate to have over 5,700 Desk Top Procedures loaded for just our North America Region. The key selling point was that the Accountant is the true owner of the process (they are the experts) and the actual document was available to them to be updated at any time.
With BlackLine Task Management, you can create custom fields, document reference numbers, preparers and approvers, frequencies, and more in an import template. The import template will establish the DTPs and add them to the dashboard for your accountants.
The accountants (preparers) have real-time dashboard visibility into their respective DTPs, and given enough time, they can easily create and upload those procedures.
Benefits of Desk Top Procedures
Whether or not you are using a finance automation platform, DTPs deliver a multitude of benefits for your Finance and Accounting departments. These include:
- Streamlined standard templates for documentation, inclusive of the many critical processes in your overall close
- Visibility into common manual processes that could potentially be flagged for automation
- Cross-training capabilities that will empower and engage your teams
- Full coverage for accountants out of the office (such as vacations, sick days, or maternity leave)
- Full documentation of critical policies needed for auditors (such as reserve policies or procedures for account reconciliations)
- Eliminating the non-valued added time needed to track down policies and paperwork and explain processes
Regardless of where you are in your finance automation journey, it’s important to consider implementing Desk Top Procedures. You can use the solutions I’ve outlined above to establish standard, documented procedures—and when you’re ready for automation, your baseline will already be in place.
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