Digital Technology for your Financial Reconciliation
Businesses today have a clear need for a financial reconciliation management system that is fast, streamlined, and audit ready. Volatility and disruptions are the order of the day at the markets and the 2020 pandemic has added to the mix, resulting in a state of confusion.
In most businesses, the financial reconciliation process is a manual and a recurring task – a series of interconnected and complex processes that require the reconciliation process to be managed across general ledgers, sub-ledgers, and bank accounts. Limited resources, siloed data, and error-prone spreadsheets add to the complexity that compromise accuracy, control, and transparency – making the financial close process highly inefficient.
Today businesses need to:
Close faster
Eliminate unnecessary status update meetings to manually review account balances before closing the accounting cycle.
Streamline and centralize the close process
Get rid of error-prone spreadsheets and track reconciliation progress in real-time while identifying bottlenecks in the close process.
Be audit-ready
Achieve an accurate reconciliation that is fast, reduces risks and costs, and ensures regulatory compliance with a clear audit trail.
Improving agility and accuracy of financial processes requires better use of data and automation. There are significant tangible benefits to implementing modern technology that helps increase speed and agility, while ensuring accuracy and freeing up time for strategic and transformation efforts.
It is a known fact in the industry that companies spend too much time reconciling reports that are output by different systems. Furthermore, the reports need to be reconciled across all functions, including accounting, trades, stocks, commissions, and more.
To meet the existing challenge, there is a clear requirement for a solution that collects, blends, and analyzes data from disparate systems automatically. All manual reconciliation activities need to be replaced with a simple and seamless solution that will identify and avoid fraudulent activities as well as eliminate manual/system integration errors in journals.
This is why there are significant and tangible benefits to implementing modern technology that helps increase speed and agility while ensuring accuracy and freeing up time for strategic and transformation efforts.
What needs to be done?
If we are to analyze the problems at the root of it all and suggest a simple and direct solution, that would be automation. By automating repetitive tasks across broker, invoice, and stock reconciliations, users can continuously perform data reconciliation eliminating the risk of manual errors. Businesses need to connect all their disjointed systems and bring data to one place, ensuring that the users have complete access to this data in real-time, on-demand, whenever they need it.
Identify deviations and isolate root causes
Businesses need to streamline and centralize the close process by getting rid of error-prone spreadsheets and track reconciliation progress in real-time while identifying bottlenecks in the close process. They also need to be audit-ready by achieving an accurate reconciliation that is fast, reduces risks and costs, and ensures regulatory compliance with a clear audit trail.
Close faster with automation
As simple as automation sounds, financial reconciliation is inherently complex and layered, and businesses need to close faster by eliminating unnecessary status update meetings to manually review account balances before closing the accounting cycle. This includes:
-Broker reconciliation: Helps match trades from transaction or ledger systems with broker statements as well as identify breaks and differences between systems, modules, and reports. with ease. Replacing manual reconciliation activities reduces end-of-day/month time pressure.
-Invoice and stock reconciliation: The process includes streamlining reconciliations and increasing control by matching payments, adjustments, receipts, contracts, stocks, and commissions. Avoiding errors, monitoring breaks and breaches across entities while automating complex grouping and calculations to reconcile trades, stocks, commissions, across disparate systems
Ensure transparency through a foundation of connected data
It’s common for traders, risk managers, finance specialists, and supply chain managers to spend inordinate amounts of time reconciling reports that are output by different systems. The time they spend manually reconciling reports could be better spent analyzing data to help make better decisions.
Despite having multiple tools and systems, organizations, both large and small across multiple industries, still struggle with a very manual, time-consuming, and tedious process of a day end and a month-end close. An automated solution could save huge amounts of resource power, reduce manual errors, and bring in tremendous process efficiencies.
Way forward
The faster pace in the industry today means that the businesses need to gain a more comprehensive and accurate view of the business. A single source of truth, greater visibility, and control over operations and risks essentially allow the business to gain from improved collaboration, data accuracy, and consistency throughout the organization. How fast can you move to automated and continuous financial reconciliation? In days? minutes? This is the question that needs to be answered.
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Learn how a leading sugar company reduced monthly reconciliation time from 15 days to a few minutes
For more details reach out to an Eka expert by writing to info@eka1.com
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