Close A Non Event Landing Page Banner 1

The often-frenetic activity of financial close processes is largely due to the huge amount of manual effort they entail every month or quarter. To reduce the pressure and risk this brings, there is an answer for finance departments: use automation across the close.

If done effectively, this can mean the financial close becomes a non-event. And it also allows finance staff to focus on essential analysis to provide essential insights that can improve broader business performance.

In the recent ‘How to Make the Financial Close a Non-Event’ webinar, experts from French utility Engie, multinational chemical manufacturer Ashland and Redwood discussed how reducing manual tasks and improving visibility through automation is transforming the month-end close.

Michel Le Boëdec, consultant and former director of the shared services division at Engie, highlighted the importance of having accurate data for the close. For example, if figures are better than expected, or a surprise, it means your company has poor forecasting, which is bad news for investors.

Le Boëdec explained that high levels of automation have enabled shared service centers (SSCs) to improve the quality of data they work with. “New levels of productivity will be [possible] if you give more tasks to SSCs and they are able to do more,” he said.

Multinational chemical manufacturer Ashland has reaped the rewards of combining the benefits of automation with its SSC.

Chris Tecuatl, controller in EMEA for Ashland, explained how the company transferred its EMEA activities, including general ledger and financial services, to its Global Business Services unit in Hyderabad in 2014.

This prompted Ashland to standardize and automate its finance processes. Initially using Blackline to prepare, review and approve balance sheet reconciliation, the company moved to Redwood in 2018 when further automation was needed.

Redwood was preferred due to its superior integration with standard applications such as SAP, Excel and email. Initially, a handful of processes were automated  for the monthly close before further automation was introduced throughout the close.

The work provided some valuable lessons, according to Tecuatl, such as the need to standardize a process before adding automation, with the most efficient approach to create a process once and apply it globally.

“We also learned that we like to automate repetitive activities that are less added value. I always like to say… we want to take the robot out of the people, and utilize the people in the more complex things,” Tecuatl added.

Ashland now typically closes SAP in four working days. Entries are only made to the close if adjustments are needed, with a range of month-end processes now automated including preparing bonus accrual calculations and entering them into SAP.

The company has also created a close reporting team to coordinate technical steps in SAP to which it hopes – with the help of Redwood – to add the skills to design and automate other close processes.

While the monthly close can still be challenging, a focus on standardization, resource optimization and centralization has allowed Ashland to make huge progress. “Each month we learn more and each month we try to be more efficient,” said Tecuatl.

Citing Ashland, Redwood’s SVP of finance automation and customer experience officer, Shak Akhtar, said: “When you look at automation as a means to [making the close a non-event], there is no hard and fast rule where you start.”

He noted that some Redwood customers automate the most painful and standardized parts of the financial close first, while others automate the entire close.

Whatever the approach, Akhtar said using automation to squash the peak of work needed to complete the financial close “means you can really do something with the productivity that you release”.

Fnd out more about Redwood’s Finance Automation solution.

About The Author

Shak Akhtar's Avatar

Shak Akhtar

Shak Akhtar, General Manager of Finance Automation at Redwood Software, possesses extensive experience in finance and IT. With an accounting background with IBM and roles at SAP®, BEA and Wolters Kluwer/Tagetik, he brings a wealth of hands-on knowledge as he leads global initiatives in finance automation and record-to-report (R2R), facilitating client-led financial transformation.