Closing the Books: Excel Financial Close Checklist is for Numbers, Not People

By September 19, 2013Closing the Books

When working in an accounting department Microsoft Excel becomes a way of life – especially for closing the books. Excel offers an extremely powerful tool for departments to maintain workbooks related to closing the books. Each month you roll forward your prior month’s work until you reach year end, where you are left with a detailed package ready for your auditors. This system is great when it comes to financial numbers and calculations, but why are we still trying to manage our people with an Excel financial close checklist?

A typical close checklist:

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Why Excel doesn’t completely work for managing the close:

  • Lack of full transparency – The Controller manages the close checklist for the department. Controller, controlling… makes sense but the problem is there is no insight for the rest of the team.  The close process is a ‘domino effect’, as things have to be done in a sequential order.  Many items necessary for closing the books are dependent on other people and this leads to time wasted and prolonged status updates.
  • Need for multiple status update meetings – This goes hand in hand with transparency, as the more transparency your department has in the close process the less time you have to spend in meetings.  Status update meetings take time, from organizing them to actually attending them.  You drop everything you are doing just to let people know where you stand in the process.  10 people x .5 hours = 5 hours of lost close time.
  • Completeness comes into question – How do you document completeness?  Are initials and dates randomly in a spreadsheet as prepared and reviewed sufficient audit evidence of your controls?  Did you get everything done? Do you need to go line by line on your multiple-hundred row checklist and ensure sign off dates, then follow up with people on their status?  A substantial amount of effort is necessary for obtaining peace of mind.
  • Ineffective onboarding processes Onboarding takes time, partly because of the way financial close checklist procedures are documented.  Excel provides a list of tasks but delivers little related to how to actually perform them, or how they were completed in the past periods.  The burden of onboarding new team members is then put on other employees, taking away from their own work responsibilities.  This leads to overtime whenever a new employee is hired. This same pitfall occurs when staff is changing jobs within the organization or covering for someone who is on leave or on vacation.

The simple cloud based solution:

As fellow accountants, we’ve been there and seen first-hand the inefficiencies of using an Excel financial close checklist to manage your people, beyond your financials. At FloQast we’ve created a simple cloud based software solution to manage your accounting department team and to aid in closing the books faster, solving all the problems discussed above.

FloQast’s close management software helps teams communicate, collaborate and facilitate closing the books faster.

How to Streamline Your Month End Close with FloQast