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accountant transformation

Invoice-to-Cash: Navigating the Crossroads of Efficiency and Growth

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In today’s fast-paced business landscape, finance leaders are under increasing pressure to optimize working capital, reduce risk, and streamline operations. The invoice-to-cash (I2C) process, a critical component of financial health, often stands at the intersection of efficiency and strategic growth. A new report, Invoice-to-Cash: Navigating the Crossroads, highlights the evolving challenges and opportunities within this crucial function.

The I2C Bottleneck: A Barrier to Growth

Many organizations still struggle with inefficient, manual, and fragmented I2C processes. These inefficiencies lead to:

  • Delayed Cash Flow: Slow collections impact liquidity and the ability to invest in growth.
  • Higher Costs: Manual processes and high days sales outstanding (DSO) drive up operational costs.
  • Customer Friction: Poorly managed invoicing and collections can strain client relationships.
  • Increased Risk: Disjointed processes elevate the risk of errors, fraud, and compliance issues.

The Shift Towards Automation and Intelligence

The report emphasizes how forward-thinking finance teams are leveraging automation, AI, and analytics to modernize their I2C functions. Key trends include:

  • AI-Powered Predictive Analytics: Machine learning models help forecast customer payment behaviors, reducing late payments and bad debt.
  • Automated Invoice Processing: End-to-end digital invoicing accelerates billing cycles and improves accuracy.
  • Intelligent Collections: Automated workflows ensure proactive follow-ups, optimizing collection efforts while preserving customer relationships.
  • Data-Driven Credit Management: AI-driven credit risk analysis allows for smarter, more agile decision-making.

Strategic I2C: From Cost Center to Value Driver

With the right technology and strategy, I2C can evolve from a cost-heavy back-office function into a competitive advantage. The report outlines best practices for transformation, including:

  • Integrating AI and Automation: Reducing reliance on manual intervention ensures efficiency and scalability.
  • Enhancing Customer Experience: A seamless, digital-first approach to invoicing and payments improves satisfaction and loyalty.
  • Aligning I2C with Business Goals: Shifting I2C from a reactive to a proactive function enhances 

Organizations that embrace intelligent I2C transformation can unlock faster cash conversion cycles, reduce operational burdens, and position themselves for sustained growth. The crossroads is clear—businesses must either modernize or risk being left behind.

Download the full Invoice-to-Cash: Navigating the Crossroads report to explore the latest trends, insights, and strategies for optimizing your I2C processes.

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How to Add Fiscal Periods in BlackLine

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BlackLine allows you to add your fiscal period into the system. Here’s a scenario many accounting professionals face every year. As the end of the year approaches, it’s crucial to ensure your financial systems are ready for the upcoming fiscal year. 

Watch this short video to see Adam Riskin, our BlackLine practice leader, demonstrate how to add new fiscal periods in your system.

1. Locate the Period End Date Screen

Begin by navigating to the period end date screen in your system. This is where all your existing fiscal periods are listed. For instance, if the current year ends in December 2024, this screen will display fiscal periods through December 2024.

2. Add a New Fiscal Period

To add a new fiscal period, follow these steps:

  • Click the Add button.
  • Enter the last day of the fiscal period. For example, for January 2025, input January 31, 2025.

3. Set Reconciliation Frequency

Depending on your organization’s requirements, set the reconciliation frequency:

  • If you’re using standard frequencies (e.g., monthly, quarterly), select the appropriate frequency. For January, this would typically be “monthly.”
  • If you’re using custom frequencies, this step may not apply immediately, but it’s good practice to configure the frequency settings accurately.

4. Inactivate Period Tasks

By default, the Inactivate Period for Tasks option is checked. This hides tasks for the new period (e.g., January 2025) until closer to the period’s start. Leave this checked initially, then uncheck it as you approach the end of the prior period (e.g., December 2024) to make tasks visible.

5. Assign Due Dates

Each fiscal period requires due dates for reconciliations:

  • Key Reconciliations: Assign dates for preparation, approval, and review.
  • Non-Key Reconciliations: Assign similar dates based on a slightly extended timeline.

You can either:

  • Manually input due dates, or
  • Use the Set Due Dates feature, which leverages predefined business-day rules for automatic population.

6. Save the Fiscal Period

Once the details are entered, click Save to finalize the new fiscal period.

7. Repeat for Remaining Fiscal Periods

Follow the same process to add all fiscal periods for the new year.

8. Handle Custom Frequencies

If your organization uses custom frequencies, you’ll need to take an additional step:

  • Navigate to the Custom Frequency screen.
  • Locate the appropriate frequency (e.g., monthly, quarterly, yearly).
  • Scroll to the bottom, find the new fiscal period (e.g., January 2025), and click Add to include it in the selected frequency.

Why Custom Frequencies Matter

Failing to add new fiscal periods to custom frequencies can cause tasks and reconciliations to remain hidden, disrupting workflows for your users. This step ensures everything is visible and functional when the new fiscal period begins.

By following these steps, you can ensure a smooth transition into the new fiscal year, keeping your financial processes organized and on track. Whether you’re preparing for 2025 or beyond, this method will save you time and avoid potential disruptions.

Read more about Accounting & Accounts Receivable:

How to Add and Remove Accounts from Group Reconciliations in BlackLine

Stay Ahead of Your Reconciliations with BlackLine Email Alerts

Streamlining Financial Accuracy with Accrual Reconciliation Templates in BlackLine

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Unlocking the Potential of Accounts Receivable in 2024

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In the ever-evolving landscape of finance, Accounts Receivable (AR) is undergoing a transformative journey, emerging as a strategic player in the financial ecosystem. A recent survey conducted by Treasury Webinars on behalf of BlackLine details the current state of AR and provides valuable insights into the challenges and opportunities that lie ahead.

The Rising Strategic Role of Accounts Receivable

The global pandemic, changing supply-chain dynamics, and geopolitical uncertainties have propelled AR into a more strategic role. According to the survey, 77% of AR teams now capture the attention of CFOs, with 16% serving as key advisors on strategic business matters. Over the past 12-24 months, 75% of respondents reported a significant shift towards a more strategic role, suggesting a continued rise in the strategic importance of AR into 2024.

Expectations for Accounts Receivable in 2024

As expectations for AR teams continue to climb, the survey indicates that 71% of companies plan to increase the responsibilities of AR teams in 2024. Days Sales Outstanding (DSO), a key metric for AR success, is expected to increase for 55% of respondents. Inflationary environments, customer-specific dynamics, and supply-chain issues are identified as the main drivers of expected DSO changes in 2024.

Navigating Relationship Dynamics in Accounts Receivable

The survey digs into the intricacies of AR dynamics, exposing the existence of silos within AR teams. While 27% of companies acknowledge the presence of silos, 32% perceive them as a non-issue. The study identifies cash application as common in AR silos, emphasizing the need for collaboration and breaking down barriers to foster efficient communication.

Impact of Technology on AR Performance

Technology plays a pivotal role in shaping the performance of AR teams. While 70% of companies report a positive impact of technology on AR performance, the choice of technology tools varies. Business intelligence tools and spreadsheets emerge as the primary tools for measuring and managing AR performance. Notably, companies leveraging AR automation tools witness the most significant impact on performance, highlighting the potential of automation in enhancing efficiency.

Investments in People and Technology

Companies are aware of the evolving landscape and expressed a commitment to invest in both human capital and technology to empower AR teams. They consider skills such as data analytics, data management, and proficiency in emerging technologies as crucial for AR team members. In 2024, 62% of companies plan to upgrade AR-related technology, showcasing a dedication to continuous improvement.

Empowering Accounts Receivable Professionals

Despite the challenges, it is an exciting time for AR professionals. The strategic role of AR is increasing, and companies are planning to invest in resources for AR teams. 38% of companies are planning to add staff and 46% are increasing professional development opportunities. Companies are focused on upgrading both technical and soft skills. AR professionals are well-positioned for success.

The survey includes actionable recommendations for businesses hoping to optimize their AR functions. These include a thorough examination of existing processes, addressing silos, and investing in technology that promotes collaboration and decision-making.

The survey not only highlights the current state of AR but also provides valuable insights for businesses to strategically position themselves in the evolving financial landscape. By embracing technology, fostering collaboration, and investing in the skills of their AR teams, businesses can unlock the full potential of AR and drive bottom-line success.

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Fixing Intercompany

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This guest post from our partner, BlackLine, explains how to get started fixing intercompany.

The signs are there. Quarter after quarter, your organization’s transactions aren’t balancing. Your close is taking too long, and write-offs and tax leakage are happening too often. In short, your intercompany operations are a mess.

As issues spring to the surface and create havoc, it’s easy to get pulled in different directions trying to fix each one. But it’s best not to get caught up in a Whac-A-Mole game of jumping from one issue to the next. Instead, step back and look at your intercompany operations holistically. Then, commit to improving them so all finance and accounting functions work efficiently.

That said, the idea of transforming intercompany is incredibly daunting. How does an organization even begin to develop a strategy to ensure that everyone is following best practices? Are the problems tied up in governance and policies, in processes, or both? Do new technologies need to be adopted to automate transactions? 

To start: conduct a root-cause analysis of your intercompany finance and accounting processes. Once you do, you can pinpoint where things are breaking down and find solutions for making sustainable improvements that benefit the entire intercompany ecosystem.

Addressing All 3 Intercompany Processes

Intercompany is a network of functions and entities in which an organization is essentially trading with itself. To ensure that it conducts business fairly, it must operate according to an “arm’s length” model. Just as its different entities are segmented, a root-cause analysis must be broken down into distinct, manageable processes and address three key intercompany processes:

  1. 1. Balancing
  2. 2. Settling
  3. 3. Initiating transactions

When the Left Pocket Doesn’t Equal the Right Pocket

Many intercompany financial close delays are rooted in the fact that organizations are balancing transactions using manual processes that make it virtually impossible to identify and resolve errors, discrepancies in volume and price, currency translation, and timing differences.

Other negative impacts of transaction mismatching include:

  • Working with inaccurate customer data
  • Increased write-offs
  • Diminished ability for teams to focus on business goals

Analyzing balances to see where breakdowns occur requires a granular assessment of every trade. Examine how the seller recorded a transaction and compare that to how the buyer recorded it. Do the two match? If not, why not? Is the discrepancy an anomaly or a chronic failure that repeats throughout the system?

Ultimately, intercompany operations should work from a complete, virtual subledger of global intercompany transactions that streamline and manage reconciliation complexity and free up staff capacity and close periods quicker. This positively impacts transaction amounts, recorded taxes, and exception management.

Where Things Fall Apart Downstream

Errors accumulate when organizations fail to deliver settlement-ready balances to treasury teams and where reconciliations take too long to manage, thus delaying netting and settlement efforts. This increases FX impact and the volume of aging write-offs that can further reduce working capital and liquidity.

Other negative impacts of delayed netting and settlement include:

  • Impeded cash management
  • Adverse credit ratings and increased borrowing costs
  • Delayed mergers and acquisitions funding and lost M&A opportunities

Where intercompany balances are being settled, what do those settlements look like? Are they occurring as cash settlements where funds are being moved on the books of different entities? Where is short-term and long-term debt being created? When do equity infusions come into play? Is there good visibility into how transactions are being settled? Do you have creative control over foreign currencies, using the clearing or non-clearing of intercompany as a natural hedge against foreign currency movements?

An optimized netting and settlement function empowers the collaboration between Treasury, Accounting, Finance, and Tax with real-time visibility on the status of intercompany transactions. ERPs, banking, and treasury are integrated to facilitate and streamline netting, settlement, and clearing processes.

Where Bad Data First “Infects” the System

Very often, issues arise from the moment a transaction is begun. A common problem is that transactions and invoices are initiated in an opaque way to users. When stakeholders and accounting teams don’t have visibility and operate in silos, there’s an increased chance of errors entering the system.

Other negative impacts of initiating inaccurate transactions include:

  • Inaccurate transfer pricing mark-ups
  • Reduced tax defensibility
  • Increased preventable losses due to foreign currency fluctuation

Which transactions are taking too long? Are manual processes slowing things down? Are humans doing the heavy lifting where technology could automate processes and save teams time so they can focus on more meaningful tasks?

During this process, teams should have complete visibility when initiating, approving, and booking transactions and invoices, while enforcing correctly applied intercompany trading relationships, business logic, transfer pricing markups, and tax determinations. Intercompany service activities should follow preconfigured billing routes, automate journal entries, and produce tax-compliant invoices using automated processes.

Starting on a Path Toward Intercompany Excellence

Once an organization completes a root-cause analysis, it’s perfectly positioned to develop a strategy to optimize intercompany operations, improve governance, policies, and processes, and implement intercompany financial management best practices.

This blog post was originally published on the BlackLine blog.

Read more about Accounting & Accounts Receivable:

How Artificial Intelligence Can Reduce Transaction Failure Rates in Intercompany

Building a Successful Finance Transformation Team: Key Stakeholders and Change Champions

From Credit Managers to Strategic Partners: The Rise of Revenue Cycle Managers

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Building a Successful Finance Transformation Team: Key Stakeholders and Change Champions

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This guest post from our partner BlackLine, which provides guidance on digital finance transformation journeys.

Embracing automation has become a strategic imperative for organizations seeking operational efficiency and improved reliability for their finance and accounting (F&A) processes. However, digital finance transformation journeys come with challenges that can fundamentally shape the ultimate outcome.

A successful implementation doesn’t just mean being smart with technology. It’s about managing change throughout your organization, ensuring everyone on the team is on board and making the most of software that tackles the real, everyday pain points for F&A.

You need all the pieces to fit, and to do this companies must take a considered and strategic approach.

Clear Objectives & Goals

Anchoring your automation initiative with clear, measurable objectives will be paramount to its success. Objectives that are too vague, challenging, or difficult to measure will hinder your project before it even begins.

Clear objectives and goals, on the other hand, will help you steer the ship, and right it when things go wrong. You should think of your objectives as your island. If your project scope starts to creep or become too complex, it can feel like you’re struggling to keep your head above water. When this happens, your objectives are where you want to return. You should be able to come back to them throughout the project, to make sure that what you are doing is aligned with and in support of these initial goals. This will help you to circumvent scope drift and focus on tackling the challenges that matter most to your business and its people.

Additionally, during this first step, you should already be thinking about the success story you want to tell at the end of the project. Think about the objectives you’ve set – do you know how you will show that you’ve met these? What benefits will these help to deliver, for people and the organization? If you can’t answer these questions, you may need to revisit your objectives to make them clearer and more specific.

Establish Metrics That Align with Automation Goals

This brings us to metrics and measurement. Whatever your goals for implementing new technology, demonstrating a good ROI, and building a business case for any future improvements, your definition of success must be etched in metrics. This is an area that sometimes (mistakenly) gets left to the end of a project. However, I would encourage you to view this as something that goes hand-in-hand with objective setting.

If you don’t think about measurement until the end, you’ll only measure what you can – not what would have been best for showcasing success. Establishing the right metrics at the beginning of the project gives you the opportunity to look at these at every stage, adjust your approach accordingly, and continue on your transformation journey.

Key Stakeholder Engagement

Planning is a priority at the beginning of any project – but change is a team effort. Get the right people involved and do it right away.

Rather than viewing your automation initiative solely through a technology or organizational lens, think about transformation as a people-centric process. Who will be impacted by this project and at what stage? Who needs to be informed? Who is a decision maker? Who can help you shape this? Who, ultimately, will its success depend on?

Involving key stakeholders from the beginning is important for setting expectations and avoiding challenges further down the line. If you introduce a stakeholder group too late, you might end up with objectives that move or change over time, or with technology that is not widely accepted by those who need to use it. Those brought into the project in the early stages are considerably less likely to challenge things down the line. Particularly if they have played a part in setting objectives or goals.

Depending on the size of your organization, the number of people who need to be informed and involved will vary. But there are three groups you should not forget:

A senior leader: someone who will help champion the project for you.

Your IT department: This team is crucial for any digital F&A initiative. The worst thing you can do is spring a project on them at the end of the line once a solution has been purchased, with an outcome and delivery date that does not work for their time and resources.

End users: Never forget the people who will be using the software you’re introducing and remember that people can sometimes feel threatened by change. Communicating how this will benefit them and hearing their concerns are both fundamental to managing change.

Change Champions

Every team needs its heroes. As part of your ongoing stakeholder engagement, try to identify and support “change champions” within your company.

Your most engaged and passionate colleagues often make the best champions. They’re the ones who know the current processes and pain points and see the benefits of what you’re trying to do. They may see that the next step in their own career is getting confident using the latest technology. These people can help you communicate how responsibilities and procedures are changing and why. They can help others adapt to the changes and make the integration process smoother.

Testing Before Showtime, Not After

Before your transformation project goes live, remember: test, test, and test again. Do not wait for issues to reveal themselves after launch. Instead, ensure rigorous testing has been carried out well in advance of the go-live date.  

This is a crucial part of the process to ensure that the technology performs as expected and that any potential roadblocks are dealt with proactively and head on. What’s more, it will build confidence in the system’s readiness and sets the stage for communicating success back to the business.

User Acceptance Testing (UAT) – testing of the technology with real-life users and scenarios – is invaluable at this stage. It will identify any unforeseen issues before the official launch, giving the team a chance to address them.

Balancing Perfection & Progress

While it’s critical to test and make sure you’re set up for a successful launch, it’s also important to understand that there is room to refine and improve things at a later stage.

A common mistake during an integration project is to expect perfection right away and become stuck in a holding pattern when it doesn’t materialize. If 95% of your project and processes are working as expected, that may be enough. Prioritizing measurable and impactful progress over a ‘perfect scenario’ will help you to reap benefits sooner. In turn, these benefits will likely help you to make a case for any additional investment that might be needed to achieve that last 5%.

Often, it’s better to take a step-by-step approach to transformation, gradually scaling and bringing people on the journey with you. Trying to do everything at once only heightens the risk of overpromising and underdelivering. 

Sharing the Success

Once everything is up and running, it’s time to share the good news. If earlier steps were followed, accurate metrics in line with initial objectives will demonstrate the automation’s positive impact. What’s more, you should have a range of stakeholders and change champions who are ready and willing to talk about the benefits they’ve seen along the way.

Ultimately, a successful automation journey opens exciting possibilities for F&A teams. While the technicalities are important, the real key to success is understanding that people are at the heart of it all. Ensuring successful implementation of technology and ushering in positive change requires F&A leaders to bring together employees, processes, and technology. By following these steps, you should be set up for success and in a position to demonstrate ROI for the next steps in your transformation journey.

This blog post was originally published on the BlackLine blog.

Read more about Accounting & Accounts Receivable:

From Credit Managers to Strategic Partners: The Rise of Revenue Cycle Managers

Redefining Accounting: Embracing Technology to Transform the Profession

The Future of Accounting: Breaking Free from Manual Tasks with Technology

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Modern Accounting: The Transformed Accountant

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This is a guest blog post from our partner BlackLine, written by Anders Liu-Lindberg, a leading advisor to senior Finance and FP&A leaders on how to succeed with business partnering.

Finance and Accounting have been in a decade-long transformation journey, and while some feel like there is no end in sight, we have actually come a long way already.

Accenture recently reported that 60% of traditional finance tasks are now automated (up from just 34% in 2018). However, far too many transformation projects have had the aim to simply reduce the cost of Accounting and Finance rather than increase its value. This is a key flaw as it just reduces the size of the finance function and leaves a lot of value on the table. 

Instead, we believe F&A leaders should plan for how to use your newly freed-up resources. Automating your processes and increasing data quality delivers a lot of benefits if we understand how to use the numbers properly. It can enable accountants to transform into strategic business partners and use their time in a completely different way, adding a lot more value to the company. 

In this article, we share our view on what a week in the life of an accountant could look like when a finance transformation is completed successfully. We will also discuss the skills and continuous enablement from digital solutions accountants need to excel in the future of finance. 

The Ideal Week for the Transformed Accountant 

Finance transformation is just as much a functional agenda as it is an individual agenda. If accountants do not decide to do anything differently, they will be left behind to do mundane work without a chance to be a business partner.

Hence, it is important that all accountants choose to work in new ways, and ideally, become a valued partner to the business. Here is what an ideal week looks like for a finance business partner in a transformed finance function.

There are naturally a few pre-requisites that need to happen to make this week a reality:

  • Accounting becomes a centralized function that is largely automated with full responsibility for producing the numbers. This also involves all transactional processes of order to cash and procure to pay.
  • A center of excellence for analytics is established to ensure most reporting and analysis is done in a standard way and is based on one set of numbers.
  • The finance operating model is changed to transform accounting roles into business partners with proper upskilling, so they can embrace their new role with confidence.

Just imagine for a moment that most of your F&A teams already operate this way. How much value would be created and how would it change business stakeholder’s perception of Accounting and Finance?

We bet this would compel them to invest in more finance and accounting staff instead of additional sales reps.

How Accountants Succeed in This Role 

To succeed in this post-transformation role, accountants must spend very little time producing the numbers. The most they would get involved in is qualifying input on accruals and manual adjustments, as well as creating ad hoc analysis on request from their stakeholders.

Getting to this state can only happen if processes are further automated and analysis of the numbers is made simple and easily accessible. 

Also, we must provide accountants with simple solutions and processes they can use to engage with their new stakeholders in the business. We must recognize that this a hard behavioral shift for most accountants.

We have been used to having a relationship with the numbers, which shifts to people for the large part. Hence, we should invest in upskilling the team so they are trained on using the new solutions and processes and are provided with coaching and feedback into their practical application. 

Your finance function can become a value generator rather than a pure cost-drain if you do all this. This is a fundamental shift and the real benefit of the decade-long finance transformation that we have been going through.

However, we must travel the last mile now and enable accountants to become business partners to realize the vision of the value-generating finance function. Are you ready to take the first step?

This blog post was originally published on the BlackLine blog.

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