So how can you rely on your financial data? Employing a reliable finance team and/or engaging with an experienced and reputable accountant are two important ways. Having a robust and well documented period close process is paramount. But, asks Ryan Pearcy, Associate Partner, surely there is a way technology can help with this?
There are multiple tools in the marketplace that can ingest, analyse, review and report back on the quality of the data in a business’s finance systems. These either focus on data integrity or period close, and range from a simple rating score of measuring how good your data is, to automatic prompts for prepayments and accruals, as well as augmented control account reconciliations. They are either built directly into finance systems or plug into systems via a secure API (a programming interface that allows different pieces of software to ‘talk’ to each other).
The simplest tools are best used by bookkeepers to ensure they are allocating transactions consistently to nominal accounts and VAT codes, and flagging anomalies for quick review. At the other end of the scale, the most advanced are best for financial controllers as they have the anomaly prompts but also review balance sheet accounts for payments against liabilities, highlighting discrepancies for further analysis. And if you run multiple companies, some can review your intercompany accounts, identifying irregularities and prompting adjustments that are needed. This focuses attention as well as streamlining reconciliation, significantly shortening the review period. The latest tools that are coming into the market can identify potential timing adjustments, such as prepayments and accruals, and pre-create journal adjustments for these.
Reliable business decisions can only be made when key stakeholders are presented with reports that display the right data. Those reports are only any good if the data that underpins them is accurate. Data integrity tools help provide reassurance on this, whilst period end tools make the process easier for finance teams.
There are dozens of tools out there such as Syft, Dext Precision, Hindsight, Xenon Connect and Mayday Recharger, to name a handful. The best one for you will depend on the size and complexity of your business operations and the setup of your team. Utilising the right one can have a big impact on the reliability of your reports and therefore your decision making.
The SB Digital team have spent their time and used their professional expertise assessing and comparing these systems to enable them to provide reliable and bespoke advice to their clients. If you want to improve your decision making with tailored reports built on dependable data, reach out to the team for a complimentary initial consultation.