0 comments on “How to Effectively Manage Year-end External Audits”

How to Effectively Manage Year-end External Audits

Most companies actually dread year-end audits.  You will find that Finance organizations are usually off-limits during this period as they struggle to make last-minute adjustments, prepare supporting schedules, find source documents, and review a year’s worth of transactions.  Stressed, pressured, and burned-out, risk of errors increase.  Overall — an unpleasant experience.

But year-end audits should not be disruptive.  Nor preparations should be done, well, at year-end.  To ease the stress during this period, below are simple changes and process improvement that your Finance organization can adopt.

PEOPLE

Plan your audit activities & deliverables and discuss with those who will be involved so they know what are expected of them.  A checklist of audit requirements and due dates that everyone, including your external auditors, can refer to is most helpful as it will keep people focused.  Schedule regular update meetings and use the checklist to track progress.

TECHNOLOGY

Leverage on available (and affordable) technology.  Reduce reliance on excel spreadsheets by investing in an accounting system that best fits your organization.  Most systems now come with subsidiary ledgers and customizable reports that will not only reduce time spent on data preparation but will also increase the accuracy of your information.  Documents-scanning technology (within your accounting system or as a separate software altogether) is also helpful when retrieving supporting documents requested by your auditors.

PROCESS

As mentioned, preparations for the year-end audit does not have to be done at year-end.  Embed automation, control, and period-end tasks within your day-to-day activities.  By adopting continuous accounting, you will be “audit-ready” any time of the year.

BONUS TIPS:

Year-end audit process will include review of your quarter one results right after the period under audit.  Make sure you don’t neglect your usual closing activities while attending to the requests of your external auditors.

Most of all, immediately after the conclusion of every year-end audit, take a moment to review, evaluate, and list down learnings and areas for improvement — both within your organization and with your external auditors — for an even more hassle-free year-end audit next time.

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How we can help? Developing and implementing a solid finance transformation agenda is the hallmark of our ACCOUNTING SERVICES model — we build, operate, and transform fundamental capabilities in people, processes, and technology. Contact us to know more about these services.

 

0 comments on “Management Insight: Status Quo is Riskier than Change”

Management Insight: Status Quo is Riskier than Change

Experiences certainly present lots of old and new challenges, and adds more valuable learnings to become better in future dealings.

As can be expected, change will always certainly happen – whether planned or unplanned.  Either because it is internally initiated or externally triggered by events. Impact of changes can either be isolated or widespread, short-lived, or longer-lasting. But when is change good or bad?  When is it too soon or too late? When is it too little, too big, or just right?

People can either welcome or resist change.  People can either choose to be the catalyst and be in the forefront or choose the status quo and risk being left behind.

Whether we like it or not, change will undoubtedly happen – so might as well be open to liking it rather than resisting or fearing!

And in case we fail, we fail early.  And when we fail early, we learn earlier than the many. Remember, we can always stand up… and change again!  Just continue moving forward but not without the learnings!

Here’s an inside story of real happenings in a company who pioneered an industry segment years ago: Visibly a lucrative, profitable business, it quickly attracted other businessmen to enter the market like mushrooms, growing exponentially.  The multitude of entrants grew faster than the pioneer’s own business and consequently reduced its share to merely 35% of the market it dominated during its earlier years.
Although the enterprise was quick enough to implement the growing technology-enabled products, the head office administration, support services, finance and management organization remained traditional.  Instead of propelling the front businesses, these head office services and practices slowed down business expansion thus allowing the rest of the market to grow faster.
Realizing the need to change, they hired executives, managers, and professionals to enable transformation of its central operation and management.
New people in the organization expectedly introduced surgical transformational changes. Expectedly as well, the natural resistance to change of the homegrown people prevented the faster realization of the advantages and benefits. Just as when the initiatives were about to peak further and reach new highs, significant external events triggered tsunami-like waves of challenges risking all the great business creativities.
Suddenly, the entire organization scampered for further and quicker changes.  Many of the postponed actions in consideration of homegrown people’s sensitivities became absolutely urgent and thereby executed swiftly. Only this time, rightly or wrongly, there was no longer regard to human sensitivities as crisis situations require desperate (not necessarily deliberate) counter measures.  What were intended to make the business thrive are now being made to merely survive.

In this story, change initiatives introduced but sidelined in the past turned out to be the most sought life-saving medicines when needed desperately. See, protecting the status quo is riskier because the rest of the world will continue to change anyway. Don’t forget: LIFE HAPPENS!

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How we can help?

Developing and implementing a solid finance transformation agenda is the hallmark of our ACCOUNTING SERVICES model — we build, operate, and transform fundamental capabilities in people, processes, and technology. We go beyond change management! Contact us to know more about these services.

1 comment on “Physical and Digital Channels Must Co-Exist in Retail”

Physical and Digital Channels Must Co-Exist in Retail

The digital retail landscape has been fast growing because of numerous benefits from both customers and business owners.

For the customer, the clamor for convenience is motivation enough to shift to online shopping.

Some of the conveniences offered in the digital retail space are: avoidance of Philippine traffic and long checkout lines, ease in sorting, searching, comparing products, access to multiple and credible product reviews or recommendations.

To the business owner, it is all about untapped opportunities and breaking barriers.

For one, e-commerce solutions are way cheaper than building brick and mortar stores. Customer reach is beyond geographical location, presenting an opportunity to expand on under-served markets.

This digital transformation is believed to be a threat to the conventional physical retail channels. Business owners feel that transformation is purely “digital”, and thinks physical channels can be ignored. On the contrary, digital must instead be integrated with physical because the latter completes the customer experience through human interaction. Other than those customers who need to buy items they instantly need and wouldn’t want to wait for delivery lead time, there are also customers who place more confidence in the value of experience than convenience.

Indeed, business transformation calls for an inclusive approach – leveraging on the wealth of digital solutions and information sources while keeping reality beyond virtual.

Insights can be extracted from these information sources through analysis. Robust analytics will help improve operational efficiency (i.e. inventory management) and target valuable customers so that customers will be provided a seamless experience throughout available channels.

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How can we help? Accelerating your analytics journey is the core objective of RAPID INSIGHTS ZONE — premium analytics professional services, made available to all business types and sizes. Our services will help you KNOW MORE through analytics, so you have MORE TIME and resources to focus on growth. When you are ready to accelerate your analytics journey and inevitable business transformation, contact us!

0 comments on “TECHNOLOGY IN DRUGSTORES: Making Technology Work for You”

TECHNOLOGY IN DRUGSTORES: Making Technology Work for You

Hurting or Helping the Business?  As technology continues to advance, drugstores try to learn to adopt and adjust.   Over 10 years ago, drugstores used cash registers and “paltas” for inventory counts.  By this time, drugstores like many retailers are already using Point-of-Sale systems for official receipts and cashiering.   Some POS even use front-of-store sales order terminals and with back-of-store integrated inventory functionalities.

Currently, drugstores are beginning to evaluate or are already using accounting and financial systems for their back-office operations.

Technology adoption in businesses will certainly continue to help attain better outcomes — whether it is enhanced customer experience, higher cost and profit efficiency, or better governance and compliance.

Drugstores must never sit back and keep doing what works with current practices.  They must keep an eye for technology opportunities and keep up with the changes. 

Unveiling What’s Next.  Some of the new tools coming out focus specifically on updating core systems and existing capabilities.  Other “exponential” tools are designed to deliver new and different capabilities.

Certain new technologies relevant to existing systems that will unlock the business value of information are:

  • CLOUD uses scalable, elastic technology to deliver services over the internet. Cloud solutions avoid large investments and limit cost on a per use only.
  • ANALYTICS offers new techniques to confront crispy questions with insightful answers. Macro to micro views show high level information with capability to drill-down to granular details.
  • VISUALIZATION refers dashboard graphics, images or rich formats thus enhancing meaningful patterns that suggest future opportunities or risks.

Analytics are now for everyone. Size doesn’t matter anymore.

Why Is Analytics Important to Business?  Today and tomorrow, running a business without analytics is like flying an airplane without any of the gauges working. Absent or lacking information renders a decision-making process highly dependent on instincts and intuitions.  With analytics, decisions will be vastly aided by and armed with business information and insights.

Certainly, early adopters of core systems (e.g., POS) will reap greater benefits of analytics technologies.

Cloud analytics can be securely accessed anytime and anywhere, with any device, but not by anyone.

Make analytics technology work for you and your business.

 rapid insights zone

How can we help? Accelerating your analytics journey is the core objective of RAPID INSIGHTS ZONE — premium analytics professional services, made available to all business types and sizes. Our services will help you KNOW MORE through analytics, so you have MORE TIME and resources to focus on growth. When you are ready to accelerate your analytics journey and inevitable business transformation, contact us!

0 comments on “FAST CLOSE: How to get there?”

FAST CLOSE: How to get there?

How fast do you close your books?

If you can close your books, distribute reports to stakeholders, AND give analysis or data-driven insights to management within 5 days after period-end, then CONGRATULATIONS — you may stop reading this now and get on with doing a very fine job!

These days, it is not uncommon to find Finance organizations struggling every period-end — swamped with non-value adding activities and overworked during closing — resulting to burned-out employees, increased risk of errors, and out-of-date results. This is especially true in retail organizations (i.e. drugstores, restaurants, coffee shops, etc.) where consolidation of multiple remote locations remains a challenge.

Fret not, here are common and simple solutions and approaches applied from years of experience in various industries:

PEOPLE

  1. Define clear objectives. People will follow you if they know where you are going.
  2. Set key performance indicators. You can’t control (hence, can’t improve) what you can’t measure.
  3. Ensure continuous learning & development. When you know better, you do better.

TECHNOLOGY

  1. Automate. There are already an abundance of technology solutions available even to small enterprises from as basic as desktop automation like workflow and macros to sophisticated cognitive automation.
  2. Integrate. When data is compartmentalized, organizations look to the office of the CFO to initiate integration of various systems in order to operate from a single version of truth.
  3. Innovate. To maintain competitive advantage, it is imperative that your business be up to date with all of the relevant technological upgrades such as cloud-based technology.

PROCESS

  1. Standardize and simplify. From transactions processing to master lists to report templates, standardization enhances the quality of data and makes it easy to spot mistakes/errors.
  2. Implement and enforce effective controls. Strategic checkpoints and red-flags throughout the period eliminates period-end lengthy tracking and tracing and resolution of errors.
  3. Set cut-offs. Pro tip: It doesn’t have to be the last day of the month.
  4. Process documentation. Documentation of tasks that are done more than once or completed by multiple people provides consistency and allows easy monitoring and revision of processes as you go along.
  5. CONTINUOUS ACCOUNTING embeds automation, control, and period-end tasks within day-to-day activities. Blackline explains it accurately in these illustrations (READ MORE: https://www.blackline.com/continuous-accounting).
OLD MODEL: Record-to-report

Blackline - old model

THE MODERN APPROACH: Continuous Accounting

Blackline - modern approach

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How we can help?

Developing and implementing a solid finance transformation agenda is the hallmark of our ACCOUNTING SERVICES model — we build, operate, and transform fundamental capabilities in people, processes, and technology. Contact us to KNOW MORE about how to FAST CLOSE.