A checklist is a common way for anyone to prioritize, but for
accounting professionals, it takes on a whole other meaning. To accountants at
month-end, a checklist is the Holy Grail.
During the close, it’s probably one of the first documents opened
when powering on your computer in the morning, and it’s likely the last file
updated at the end of the day.
The purpose of the checklist is to compile all month-end
close activities—journal entries, account reconciliations, adjustments,
reclassifications, analyses—and classify them by critical criteria like owner,
due date, and entity. And when looking for a completion status, it’s the single
source of truth to give you that information.
Because of the significance of the month-end checklist for Accounting,
companies often seek technology to ensure theirs is best-in-class.
But if the critical accounting work takes place within the
activities of the financial close task list, then you’re only just scratching
the surface with a streamlined checklist.
Let’s go over three reasons why a successful month-end close
process is so much more than just a checklist.
It’s Okay to Be Unique
It would be nice if there was a month-end close checklist fit
for all, but that’s hardly the case. The underlying guidelines and principles
might be the same for most organizations, but different industries, sizes,
organization structures, and business processes create complexities and
dependencies that are unique to individual accounting teams.
Because of this, accounting teams seeking a leading solution
should be cautious of vendors that offer ‘out-of-the-box’ close management
software. Applications like these might provide basic workflow or visibility,
but they fail to offer more advanced capabilities like dependencies or
integration to solutions addressing the tasks themselves.
and dynamic financial close task list, one that is configurable to your
team’s best practices and adaptable to changes—from acquisitions to changes
only the beginning to achieving a best-in-class month-end close process.
There’s More to a Checklist Than Meets the Eye
Moving away from keeping a close checklist in spreadsheets
or on a shared drive is step one. But what about managing certification and
approval workflow, segregation of duties, version control, or an audit trail? And
what about defined and documenting policies and procedures?
A centralized checklist with real-time visibility only
solves a portion of control issues that are evident when your tasks aren’t
integrated with the rest of the close process. Accountants find themselves
still going back and forth to different close activities, with no real
dependencies or understanding of the status until the entire account has been
closed out and complete.
Without embedded integration between your close checklist
and the underlying accounting work that goes along with it, you run the risk of
financial close control deficiencies.
You’re Growing & So Is Your Checklist
As your business grows or evolves, inevitably, your accounting
team must adjust.
Is your month-end close process scalable and adaptable? Is your
checklist integrated with the underlying tasks—account reconciliations, journal
entries, flux analyses, or high-volume matching exercises—so if you added new
controls or dependencies it would be easy to adapt with maximized automation?
The short-term gains associated with a basic financial close
checklist solution might be appealing, but it’s important to keep a long-term
mindset. With a bit more effort and planning upfront, your team will only have
to evaluate one solution for the financial close process.
BlackLine’s unified cloud platform delivers an end-to-end
solution. With full integration of all accounting activities, our solutions
go beyond just providing real-time visibility by maximized automation and
Read this blog for four best practices to improve your month-end close checklist—and your entire close process.
The post Why a Checklist is Just the Beginning of a Successful Month-End Close appeared first on BlackLine Magazine.