Arla Foods answers four key questions about its month-end close challenges
By Shak Akhtar, SVP Finance Automation/Customer Experience Officer, Redwood Software
We asked dairy giant Arla Foods four key questions about the challenges of its month-end close and how to tackle them.
The company is the one of the world’s largest dairy companies, selling products in more than 100 countries, with 19,000 employees and revenue of over €10 billion.
In the video interview, Arla talks about reducing the time to close the books, the importance of having an overview of the month-end tasks and the challenges presented by the amount of close-related work, such as accruals and adjustments, that still has to be conducted outside of the ERP system.
Watch the video interview to find out what Arla said in response to these four key questions:
- What aspects of the close concerns you the most and how comfortable are you with the tools available to you?
- What is the proportion of work within the ERP versus outside of the ERP?
- What are the challenges with the month-end close?
- What is your experience with Redwood?
When Redwood started working with Arla Foods over three years ago, only half of its Level 3 processes were harmonized, resulting in employees spending too much time validating and correcting errors in the close.
Arla wanted people to consistently perform the same activities in the process. This was especially true with time-consuming financial control activities, balance sheet reconciliations, intercompany accounts and month-end adjustments that were performed manually using Excel and checklists.
Redwood identified 124 tasks performed in Arla’s close, of which 121 could be automated – delivering 98% automation and a 40-50% reduction in effort. The discovery workshop suggested Arla could achieve 100% process and data quality harmonization. This reduced the time to achieve month-end close from 10 working days to seven. Now, 73% of the company’s account reconciliation is auto-certified with journal entry and intercompany fully automated. Arla is also able to close its production orders two days earlier. This has released substantial time to further improve quality and reduce the time to close.
Get in touch with Redwood to find out more.