Control and Visibility in a Two-Day Monthly Close
Australia Post Accounting Team Delivers Results with Automation & Controls
Australia Post has come a long way from delivering mail by pack horse in 1809.
The government-owned corporation has embraced innovation throughout its long history. It started with the telegraph in the late 1800s and has evolved to today’s use of more than 1,000 eco-friendly electric delivery vehicles—the largest fleet in the country.
That spirit of innovation extends throughout the entire business, including Accounting and Finance. The company manages over $6.8 billion in annual revenue across diverse lines of business that include delivery, ecommerce, logistics, direct marketing, and financial services, such as bill payments and insurance.
Australia Post employs over 35,000 people, delivers three billion items a year, and runs more than 4,350 post offices. With multiple subsidiaries, the scale and complexity of the organization’s financial management requires efficient automation. This automation minimizes manual work, strengthens controls, and heightens visibility.
“Our strategy in Accounting is to have the best technology embedded in our culture to strive for efficiency gains and process improvements, and to think outside the box for innovations,” says Catherine Phan, Australia Post’s Senior Manager, General Accounting. “BlackLine enables us to deliver that strategy.”
“Coming from a public accounting background, I know how important it is to drive improvement in accuracy and efficiency,” says Willardson. “Yet, we were still doing so many things manually, including reconciling hundreds of bank accounts. Our close took 15 days and still required significant overtime from staff.”
Control & Visibility in a Two-Day Monthly Close
Since 2014, Australia Post has scaled its use of BlackLine Account Reconciliations and Transaction Matching. The goal is to streamline the reconciliation process, which has been slow and onerous.
“Before BlackLine, we had little visibility and control across the group,” Phan says. “In Excel, the whole process is labor intensive and time consuming, with a lack of control.”
Australia Post began its BlackLine journey with Account Reconciliations to automate and standardize its reconciliations, with an iterative rollout across four subsidiaries. Today, BlackLine enables Australia Post to automate roughly 750 account reconciliations a month—dramatically reducing manual work and contributing to a remarkably fast two-day month-end close.
For example, Australia Post uses BlackLine to automatically generate daily reports that highlight accounts in need of closer investigation. “BlackLine offers a lot more control and visibility for account reconciliations, without having a person pulling information from team members and putting together a report,” Phan says.
“We will continue to explore the Variance Analysis function in BlackLine to provide real-time updates and meaningful balance sheet reporting to management.”
Cost Savings of $1 Million Over 3 Years
Starting with Account Reconciliations enabled Australia Post to lay the groundwork to advance to Transaction Matching with a clean slate. BlackLine U training helped Australia Post accountants learn the system quickly and take advantage of BlackLine technology.
“Because of resource constraints and various priorities, we wanted to clean up account reconciliations and then look at process improvements,” Phan explains. “We started fresh by cleaning up the accounts, and then applying Transaction Matching.”
Phan’s team uses BlackLine to match transactions across invoices, payments, and bank statements at volumes that have grown from about 200,000 to 500,000 a month as usage expanded. This is achieved by utilizing the matching rules in BlackLine for all transactional high-volume GL accounts.
Phan says, “Today, less than 1% of accounts have aging items of 90 days or more, down dramatically from 50% of accounts, thanks to the greater visibility that BlackLine provides.
“The solution is not only used by our Reconciliation Team, but also by our StarTrack Cash and Banking Team, who uses BlackLine to allocate receipt to customers. And, they are now able to allocate 80% receipt to invoices, up 50% from before they implemented BlackLine.”
In terms of financial savings, BlackLine has saved Australia Post approximately $1 million over three years. There are opportunities for further implementation, such as maximizing the total number of accounts that can be grouped into the same categories, minimizing the downloading of supporting documents, and utilizing the auto-certified features, task functions, and variance analysis. These functions will enable their teams to focus on management by exception strategy.
Australia Post is exploring further use of BlackLine in two other areas to combat consolidation pain points: matching rules and variance analysis.
For example, intercompany imbalance has always been a pain point in consolidation. Reconciliation for payroll accounts for 35,000 plus employees can be tedious and time-consuming.
BlackLine matching rules will enable accountants to improve the reconciliation process and focus on analytical work.
Whatever its direction, Australia Post can draw on proven best practices and modern technology as it further builds its world-class accounting and finance function.
“Continuous Accounting, management by exception, and process improvement are big parts of our strategies, and we’ll continue to use BlackLine to reach those goals,” Phan says.
“Understanding processes, identifying gaps, and working closely with BlackLine are key best practices we’ve followed to deliver projects and realize results.”
Faster, Streamlined Audits Complete in One Week
Annual auditing is another area in which Australia Post is seeing game-changing improvements through BlackLine. With direct access to BlackLine, external auditors now have the annual audit complete in less than one week, while Phan’s team is spared the ordeal of manual preparation and explanations.
“We don’t have to spend time sending emails, photocopying and scanning, and sitting down with the auditors to answer every single question,” Phan says. “We ensure auditors have appropriate access to the accounts they need through BlackLine, and if they have questions, it’s straightforward. That’s a very big plus for us.”
By allowing our auditors access to our BlackLine system, they have complete transparency and efficiency. They complete the audit on balance sheet reconciliation within one week instead of two. Due to BlackLine’s transparency, there are now almost no questions or concerns.