7 Steps to Ensure an RPA Win for Your Financial Close


If you’re worried about your financial close, you’re not alone. According to the FSN Modern Finance Forum’s recent survey, 97% of CFOs are kept awake at night by the concern that their finance teams will not meet their reporting deadlines.

Large, global organizations typically face the need to execute tens or even hundreds of thousands of activities during the month-end close across corporate and entities, any one of which can create a delay or add risk.

Why does the financial close continue to remain such a bottleneck and source of frustration for accounting teams? Survey after survey points to manual processes, late nights, and risk of failure as high on the list of concerns.

The truth is that it’s one of the few business processes, perhaps even the only process in the enterprise, which requires juggling speed with detail, communication, and collaboration.

Upgrading Your Close Process

To ensure that the close is accurate and timely, almost all organizations rely on checklists for the tasks that must be completed. But there’s often a gap between the reality of what close activities actually occur and who approves them, and the best practices which are buried away on spreadsheet checklists and other documents.

Minimizing that gap is often heavily reliant on people and process. It’s often why, when key accountants leave an organization, it can have a negative effect on the close―because the accountants were acting as strong orchestrators, applying gut instinct and institutional memory.

Upgrading the close process means conducting a thorough review of where the issues are and building out a clear and detailed set of activities at every level. When that has been established, the next step is to apply automation, scheduling, and orchestration while embedding controls and activities so the accounting team will act on them without fail.

Here are seven key steps to successfully bring RPA to your finance department’s close to disclose process.

7 Steps to Bring RPA to Your Financial Close Process

Conduct a Financial Close Process Health Check

The first step in making any changes is to analyze the problems you seek to change. Start with the risks and bottlenecks in your financial close and evaluate your close processes from a lean management perspective.

From Pre-Close to Close: Map Your Processes

All finance components, activities, and responsibilities must be included or it is not a close. Mapping your processes includes a weekly finance checklist, your pre-close, the closing process itself, and reporting and documentation.

Review Your Activities

Large enterprises running SAP can have a corporate close consisting of more than three hundred thousand activities a month, once everything is fully documented. This typically equates to more than five hundred activities per reporting entity/company code.

These activities themselves will always contain many sub-activities and checks, which have significant interdependencies that can result in latency and other issues.

Get Down to the Activities Detail

Industry research shows a strong relationship between the number of activities in scope and the maturity level of the month-end close process.

Organizations that have a close checklist with only around a hundred activities per entity are typically managing at too high of a level. More detail is required to be in control of the close and reduce the risk of failure.

Best-in-class companies manage their close process on a much more detailed level, with more than five hundred activities per entity. However, detail without automation has risks if rolled out purely using spreadsheets, documents, and manual controls.

It will likely extend the close, causing a spike in accounting resources. And if the organizational model doesn’t adapt, there is still risk that activities will be missed or not adhered to.

Use Robotic Process Automation to Balance Efficiency & Detail

While large enterprises have already outlined and upgraded their closing processes through checklists, they’re now moving from manual close processes with some automation to robotic process automation (RPA) incorporated into their entire close-to-disclose. RPA allows accountants, and Finance Departments as a whole, to work more efficiently, while at the same time lowering risk.

RPA shifts repetitive tasks from people to technology through a combination of intelligent workflows, business rules, triggered operations and process scheduling. It’s especially applicable to bring specific conditional workflow, robotic triggered workflows, and automatic scheduling designed to address the financial close activities at scale.

Automation tools that schedule and execute the details automatically―running actuals, open items processes, settlements, depreciations jobs and other areas, based on robotic workflows, enable accounting to get to the necessary activity detail. This enables compliance risk reduction—all while doing it sustainably without overwhelming accounting with tasks.

Operationalize Close Activities

While automation is an important step in any close process upgrade, without operationalizing it, the value will vary. That’s because, even with the best automation tools, poor integration with your ERP will result in limited adoption and, subsequently, have limited impact.

In many cases, close checklists, approval steps, and controls exist outside of the ERP, leaving it to team training and diligence that accounting will use them. Operationalizing controls means embedding them in the ERP, always operating on live data, minimizing separate systems and providing real-time overviews for the completion of tasks based on their status in the ERP.

Don’t Stop! Apply Continuous Improvement

Best-in-class organizations close approximately twice as fast as the average, with efficiencies throughout the close from the BU close to pre-consolidation and consolidation processes to financial and management reporting.

But this wasn’t achieved overnight. These organizations have typically been on a multi-year journey, continually identifying bottlenecks, making changes to checklists, and automating specific tasks based on rigorous feedback and review. With any upgrade, it’s important to monitor process and activity adoption in order to consistently identify roadblocks and continuously refine the close process.

According to a recent survey by Genpact Research, one-third of finance leaders find that RPA tools and applications are having a positive operational impact in their organizations, and more than half the respondents believe that RPA will have the greatest impact of all finance and accounting tools over the next two years.

Click here for more information on how to incorporate RPA into your financial close.