Account reconciliations are an essential accounting control in the close process. The process needs to be accurate the first time, as there are consequences to deficiencies. The consequences can be turned into opportunities with the use of technology to optimize the process resulting in confidence, cost savings, and transparency.
As I have mentioned in several blogs over the last couple of months, the common model for account reconciliations is error-prone, lacks transparency, is time-consuming to maintain, lacks governance and controls, lacks integration between reconciliation processes, and is not adaptable to change as the organization matures. My colleagues and I recently hosted a webinar on Oracle Account Reconciliation where we identified several key benefits of the solution including:
- Centralization and standardization of reconciliation processes
- Automation to eliminate manual touchpoints and eliminate redundant tasks
- Systematic controls to drive compliance of accounting controls
- Scalability and modularity for future growth or additional reconciliation needs
- Continual improvement to identify bottlenecks and look for ways to enhance the overall process
- Cost synergies to leverage technology to reduce operational cost
Also, there are various reconciliation processes that are included in the close process, including:
- High volume – cash, transactional detail, and operational reconciliations
- Close focused – interface, sub-ledger to ledger, and intercompany
- Compliance – financial substantiation, SOX/MAR compliance, and accounting controls
- Disclosure – balance sheet roll-forwards, fluctuation analysis of results, and performance analysis
During the webinar, we polled the participants and found that the results reaffirmed what we are hearing from our clients.
29% responded that time to close the books was the biggest pain point and another 29% responded the lack of automation as the biggest pain point. Account reconciliations are a key concern and priority that organizations seek to address in order to optimize their current process, gain visibility, and reduce complexity within a scalable solution that matures the reconciliation and close processes.
As we have seen with our clients, 62% responded that reconciliations are currently performed manually in Microsoft Excel, Word, and similar tools. By using these manual tools, organizations miss out on the visibility of a modern solution, as well as the automation that ensures the reconciliation process has data that can be trusted and provides a greater amount of focused time on exception validation.
47% have a team of 24 or more people participating in the account reconciliation process with the second-largest respondent group of 19% with 9 to 16 people. Better use of talent should be a priority for every organization, as this leads to employee happiness, growth, and retention. Talent should be focused on strategic activities and initiatives and less time focused on redundant, time-consuming tasks.
Of the participants, 91% responded that they are looking to make a change to the account reconciliation process within the next 12 months. We have spent the last year in an environment that not many could have imagined. Last March, we watched many of our clients focus on how to rapidly transition to a remote world, to today, as we are seeing our clients more comfortably operating and proactively managing tasks.
Oracle Account Reconciliation is a purpose-built, cloud-based solution to manage the global reconciliation process, reduces the preparation and completion time of reconciliations, reduces audit review time, and standardizes the end-to-end reconciliation process. We have numerous clients that automated reconciliation tasks, streamlined reconciliation tasks, and gained a reliable and trusted solution in Oracle Account Reconciliation.
For comments, questions, or suggestions for future topics, please reach out to us at infosolutions@alithya.com. Visit our blog regularly for new posts about Cloud updates and other Oracle Cloud Services such as Planning and Budgeting, Financial Consolidation, Account Reconciliation, and Enterprise Data Management. Follow Alithya on social media for the latest information about EPM, ERP, and Analytics solutions to meet your business needs.