Let's state the uncomfortable fact up front: Financial Year End is never fun for your Finance team. You end up working late nights, having dinner in the office, wondering why the opening trial balance does not agree with your financial statements, and answering the never-ending slew of audit questions from auditors that seem to get younger each year.
Leading up to year-end, we all say to ourselves, “I hope this year-end is smoother than last year.” But instead of just hoping or praying to the patron saint of accountants (St. Matthew, in case anyone was wondering
), the best way to ensure a smooth year-end is through effective planning.
To start, you need to look at the prior year-end (sometimes those sleeping dogs just need to be woken up). The previous year's work allocation and sign-offs, if captured correctly, can show you the day when all the year-end tasks were completed, whether they were completed behind or ahead of schedule, who completed each task, and any issues that were encountered. This information is essential to capture each year to help you improve the next. Ideally, a system should capture all this information to avoid you doing all the hard work to gather some data and be prepared... only to dig up last year's Excel checklist and find half-signed-off document. 😮💨
Using this information from the previous year as your baseline, you can more effectively allocate the current year's tasks. As you make the necessary changes for the coming year, you will be able to see that certain items were completed much earlier than originally anticipated, meaning you can bring forward the due date. remove any peaks in work and ensure that work is spread evenly between the team. You can also identify areas that took more effort and time than originally anticipated and ensure that senior staff members are working on them for the current year-end.
It's crucial to map all this out visually for the team, showing exactly what they are responsible for and when it is due. This timeline and checklist need to be centralised (an "one-document-per-person" approach will ensure a painful year-end for you and the team) and accessible, and everyone needs to understand where they fit into the bigger picture. It will help give the team clarity as to whether not only they but also the whole team is on track or not.
Once you are in the thick of the year-end close and reporting process, this is where your plan needs flexibility. You will never be able to foresee every last-minute hurdle that occurs. There is always one area each year that will prove to be the problem account, whether it is an entire review of an inventory line for impairment or a particularly interesting revenue contract requiring a lot of judgment. When an account becomes obvious that it will take more time than anticipated to deal with, you need to be able to see in an instant how the other members of the team are progressing so you can reallocate work as required.
All of the above points require the team to use the correct tools made specifically for accountants. While no tool will be able to complete your entire year-end close process and reporting for you, you can get the right tools to help you survive the process and reduce the overtime required.
If you want to know more about how Easy Month End can help you enable a smoother year-end process through our software designed specifically for accountants and finance teams, reach out to our team. Unfortunately, we can‘t do your year-end for you, but we can help make the process as smooth as possible.