InTheBlack Day 3: The Blueprint for Continuous Accounting


The theme for InTheBlack 2016 is The Blueprint for Continuous Accounting, and BlackLine’s Senior Director of Product Isaac Tucker opened the morning with what this looks like in the real world and how to get there. He identified that the goal is to change the way the accounting calendar is organized, and emphasized that more than anything else, Continuous Accounting is a mindset. Top performing companies with this mindset are closing faster, have 90% greater automation, 46% lower audit fees, and 52% lower costs.

Isaac further defined Continuous Accounting by outlining what it is and what is isn’t:

  • It is not just a technology story or a software sales pitch. It is a story about timing, process design, and unleashing the power of exceptional accountants.

  • It is not just a different way to do account reconciliations. It is a significant shift in the way accountants execute on the R2R process.

  • It’s not just for big companies or small teams. It is an approach that every organization can implement.

  • It is not just an idea or a utopian vision. It is a journey of continuous improvement with real milestones.

  • It’s happening right now and it is the future of accounting.

Building a Blueprint for Continuous Accounting looks like optimizing your people, modernizing your process, and implementing technology, and the journey is made up of five milestones: Legacy processes, Modernized R2R, Continuous Processing, Strategic Accounting, and Continuous Accounting. Isaac closed with a manifesto, of sorts:

  • People are valuable. We don’t waste their time.

  • Technology is powerful. We use it to enable our people.

  • Processes are malleable. They change to fit our objectives.

  • Numbers matter. We use metrics to improve everything we do.

  • Nothing is perfect. We are continuously improving.

Cox Communications: Making Continuous Accounting Happen

Cox Communications is successfully navigating the Continuous Accounting journey. They operate from a continuous improvement mindset, and their metrics are impressive. 96% of their journal entries are automated, they’ve auto-certified 84% of their reconciliations, and 78% of their journal entries are recorded before the close. Even more impressive? They complete their close in three days.

This is how Cox Communications makes this happen:

  • Evolution of mindset – continuous improvement

  • Establish and track metrics

  • Eliminate unnecessary tasks/activities

  • Stop chasing pennies! Implement materiality thresholds

  • Automate the calculation and posting of routine journal entries and preparation of routine balance sheet account recs

  • Account for transactions and reconcile as close to real-time as reasonably possible

  • Eliminate over-reliance on managing activities with spreadsheets

Taking a Continuous Accounting approach has allowed their accounting and finance team to focus on non-routine accounting and accounting analysis in partnership with the business.

Zendesk: Building a Modern Accounting Operation with BlackLine

Zendesk is fully utilizing the BlackLine Ecosystem to build their modern accounting organization, and this began with building a strong partnership with their IT department. IT regularly reaches out to the accounting team to let them know about exciting new things they discovered in BlackLine’s Sandbox and is always happy to investigate any issues the accountants have. The Zendesk team also spends a significant amount of time training reviewers, to maintain consistency in this area.

Their biggest wins have been in the areas of completing reconciliations and managing the ‘close’:

Completing Reconciliations

  • Audit evidence alleviation

  • Work management

  • Post-certify balance updates

  • Variance and previous reconciliations view

  • Basic reconciliation automation

Managing the ‘Close’

  • Account designations

  • Close process visibility

  • Completeness

  • Auto-Follow up

  • Bottleneck analytics

In Conclusion

This is how to build the future of your organization through Continuous Accounting. It's a transformative approach that emphasizes real-time processing, differently-skilled employees, and deep analysis. It will empower your team with real-time information and reward them with a more efficient close, more accurate financials, and a more effective organization.