In an attempt to stay up to date with the accelerated pace of a technology-driven world, financial systems have haphazardly progressed by adding layer upon layer of information. Inevitably, many companies experience a general ledger that has become bogged down with an abundance of nonessential data, a situation that is often referred to as “The Fat G/L.” Such a situation can cause the financial close process to become bloated, slow, and costly.
The best way to ease the process of financial close and other business operations is to find a way to use technology to your greatest advantage. This usually requires a basic understanding of the current systems and recognizing room for improvement. For example, if your company is experiencing an overwhelming amount of data through which a team member must dig to find information executives desire, you might be a victim of “The Fat G/L.” The number of accounts and segments added to a system grows exponentially which makes that system unnecessarily complex. Thus, the G/L functions more like a messy data warehouse and less like the efficient financial system it was designed to be.
Through careful review of the organization’s financial systems, a company can discover a path forward through the intricate maze that the general ledger has become. The first step to doing this is recognizing the process has become almost insufferable because of the amount of information present. Remember, quality over quantity is key. While more is sometimes better, such is not the case for your general ledger. Continuing to add more to the process consumes expensive resources and negatively affects the efficiency of financial close.
Should you make the wise decision to put your GL on a “Diet,” you can expect the following benefits very quickly:
- Reducing in the total-cost-of-ownership of your financial close process by having less allocations, journal entries, and reconciliation points
- Minimizing the time it takes to close and therefore having to explain less about why it took so long to close
- Gaining improved insight to make financial and operational business decisions with fewer mistakes and corrections during close
Make a new year’s resolution for the overall well-being of your financial systems by regaining control at the foundation, the general ledger. Contact AdvancedEPM Consulting today to learn about our objective financial systems assessment and roadmap. Let us help you simplify your business process to start 2017 as efficiently and productive as possible.
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