This blog originally appeared as Part 12 of the continuous accounting blog series in SAP’s D!gitalist Magazine.

Corporate finance departments are acclimatizing to an environment of growth, mixed with uncertainty. For most enterprises, key growth measures are on the rise, from earnings to hiring. In response, CFOs are seeing it as a good time to take increased risk. Yet a deep vein of uncertainty is also running through the thoughts of many finance leaders, who are reacting to policy uncertainty around trade, domestic and international tax policy, and a changing regulatory environment.

These dueling requirements of supporting growth, yet preparing for uncertainty, are forcing corporate finance and accounting teams to spend more time planning, analyzing, and working with business partners than ever before.

The corporate close remains a significant drag on resources due to the need to corral the numbers from across the organization and consolidate the financials for reporting. In addition, there’s a greater need to deliver corporate financial and management results faster, and for global organizations to break out numbers across entities, subsidiaries, and countries in more detail for management and regulatory reporting.

So far in this blog series, we’ve talked about how local entities can close their own books faster, and tactics for dealing with intercompany reconciliation processes. Now it’s time to shine the light squarely on the corporate close. Our goal here is simple: to help accounting spend less time bogged down in the corporate close, improve controls, and increase the time available for corporate accounting to spend on tackling the dual CFO mandates of managing growth and balancing uncertainty.

Cut The Wait (and Risk)—Reduce Local Entity Spreadsheets

If you took a quick poll of your accounting team on where they spend their time in the close, much of it is likely spent hunting for report packages from local entities, looking for supporting documentation both sides of intercompany transactions, and locating additional disclosure information for IFRS reporting needs.

One of the biggest issues is that data from entities is often submitted using spreadsheets, or CSV extracts, which puts corporate on the back foot. Disregarding the waiting time, if you learned that, according to the ACCA, “90% of spreadsheets contain serious errors, while more than 90% of spreadsheet users are convinced that their models are error-free,” would you be quite as trusting of those emailed financials from a local entity?

The fact is, it’s simple for errors to be introduced into a spreadsheet between the local ERP, manual entry by local accounting teams, and spreadsheet calculations to create the local financial reports. With so many manual touches on the data before it gets to corporate, it’s a wonder there aren’t more issues.

While many subsidiaries are often running different accounting apps, financial consolidation and intercompany apps can help cut spreadsheets out by automating the output of local entity financials to a standard format, which leaves less room for human error. With cloud-based Web access, they can also provide corporate with the ability to log in and download the reports themselves as soon as they’re ready, rather than waiting for them to be posted to an SFTP server or arrive in e-mail.

See Where Local Entity Close Bottlenecks Are

What if corporate accounting knew where the local entity bottlenecks are, instead of mostly waiting for entity reports to trickle in for the corporate close? One of the problems is that local entities often don’t provide a great deal of transparency into where they are in their own close process, so it’s often a black box to corporate. Without that visibility, it limits corporate’s ability to proactively engage with entities that are having issues with say, reconciliations, adjustments, or journal entries.

Local entities close processes are also dependent on spreadsheets, emails, or other documents, that don’t provide clear status to corporate, leading to uncertainty. Worse, there is still also a varying degree of standardization in the close processes across entities, so what one entity has well automated, may be another entities bottleneck. This varying degree of standardization creates risk for corporate.

Close management applications essentially act as the collaborative, closing overlay for corporate and local entities. Everyone can share status, where approvals are, and which step of the entity close they’re on with their peer entities, and with corporate. For corporate accounting, it reduces the risk of waiting on entity financials and enables them to be more proactive if there are issues, and for entities, it improves communication on real-time status to corporate.

Minimize Corporate Accounting Time Wasted Chasing Local Entity Detail

The reality is that corporate shared service centers spend an inordinate amount of time chasing down local entity invoices, POs, pricing, contract, details to support reconciliations, intercompany eliminations, or accounting variances. Data from local entities often arrives at a relatively summary level, and those spreadsheets just don’t provide the detail to substantiate balances and accounting processes. An intercompany transaction, for example, really requires invoice and PO details. Yet you’ll rarely find that in the same spreadsheet as the local entities reporting package, forcing corporate accounting to go on the hunt.

Closing cockpits, intercompany accounting repository, and a degree of ERP standardization can all help by providing better self-service for corporate into local entity detail. For example, cloud invoicing and payables apps provide a greater level of self-service for corporate SSCs to log in and get the details themselves rather than waiting on entity teams.

Next Step: Getting Consolidated

In my next blog, we’ll move from getting local entity data and details to managing the financial consolidation process, mapping local accounting structures to corporate, and performing eliminations, currency translations, and other areas to fast-track corporate financial and management reporting.

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Learn More about Continuous Accounting

This blog originally appeared as part 11 of the continuous accounting blog series in SAP’s D!gitalist Magazine and has been republished with permission.  Read the rest in the series: