Smarter Close Cycle
Should we be focused on a “shorter” close cycle or a "smarter" one?
Have you been tasked with creating a shorter close cycle? Have you stopped to think about what this really means to you and your team? It can be a positive thing – you can all work on more value-add activities. But, could it also mean longer days at the beginning of the month so you end up just working more overall? How do you avoid this while still providing what is needed?
Let’s first talk “shorter”. This is usually translated as simply reporting numbers faster. Well, not just any numbers, but numbers someone can rely upon to make good decisions. And, numbers that are auditable.
So, this means that you need to optimize the processes that impact these numbers. This isn’t then just about a “shorter” close cycle, but about a “smarter” close cycle – one that truly allows you and your team to create a more enriched environment.
It all starts with defining your full close cycle – one that includes not only transactions and reporting, but control activities that help you have confidence in that reporting. Because if you don’t have confidence, you shouldn’t be providing those numbers to anyone else.
Your reconciliation program drives a very important control activity. Documenting and optimizing your reconciliation program can influence both a “shorter” and “smarter” close cycle, because your team understands and can articulate:
What their roles and responsibilities are
What activities impact and are impacted by their reconciliations
Who else is involved in these activities
When reconciliations should be completed
Which reconciliations can be improved
Be reconciliation strong™
What is one thing you can do today to encourage both a “shorter” and “smarter” close cycle? Consider asking your team their opinion of your current reconciliation program and if they would like to be involved in optimizing it. You might just find someone who is passionate about the impact that a quality reconciliation process can have on your organization. Let’s get them and the rest of your team reconciliation strong! You’ll likely end up with both a “shorter” and “smarter” close cycle and numbers that can be trusted because they are supported by quality reconciliations.
