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Ventana: Continuous Accounting Helps Companies Close Faster

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Ventana Research, an authoritative and respected market research and advisory services firm, recently looked at Revelwood’s partner Fluence Technologies and how the company helps organizations automate tasks for faster monthly, quarterly and annual closing. 

According to Ventana, by 2025 two-thirds of midsized organizations will have applied continuous accounting principles to close their monthly books within one business week. A key objective of continuous accounting is achieving a fast, clean close. 

This is part of a larger digital transformation of accounting departments, which aims to eliminate manual tasks such as consolidations and reconciliations by using software automation. 

The firm’s Smart Close Dynamic Insights report shows:

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  • 56% of organizations close their month within six business days 
  • 40% of organizations complete their quarterly close in six business days
  • 69% of those that automate all most of the close process complete the quarterly close within six days
  • Only 29% of companies that only use some or no software automation close within that six-day window

Ventana states, “Financial executives who are committed to enabling their finance organization to play a more strategic role in their company should focus on ways to streamline their close process.”

Read the full piece on continuous accounting and Fluence Technologies.

Read more about Fluence Technologies:

FP&A Done Right: The Role of Narrative Reporting in ESG

Fluence Technologies Earns “Outstanding” Overall BPM Pulse Rating from BPM Partners

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Ventana Research on Intercompany Financial Management

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Ventana Research, an authoritative and respected market research and advisory services firm, defines intercompany financial management (IFM) as a “discipline for structuring and handling transactions within a corporation and between its legal entities.” It maximizes staff efficiency and accounting accuracy. It also optimizes tax exposure, minimizes tax leakage and “ensures consistent tax and regulatory compliance.”

According to Ventana, “by 2026, one-half of organizations with 10,000 or more employees will have implemented IFM to achieve tax, risk management and accelerated financial close benefits.” The research firm states, “Typically each instance of an IFM issue is relatively small, but in larger, multinational corporations, the money involved adds up to a meaningful annual cost.”

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Large, multinational corporations have very complex systems and processes – often exacerbated by having several different ERP systems. Ventana’s Next Generation ERP Benchmark Research finds:

  • Two-thirds of organizations with more than 1,000 employees have more than one ERP system
  • 27% of percent of these organizations have more than four ERP systems

IFM provides these companies with a way to capture the “required attributes of intercompany agreements and streamlines intercompany dispute resolution and handles taxes with an integrated tax engine to maximize tax deductability.” 

Ventana states, “Being strategic in accounting is all about flawlessly managing the details, especially in areas of hair-curling complexity.” 

Read more about Ventana’s thoughts on intercompany financial management.

Revelwood’s partner, BlackLine, provides software for intercompany financial management and other accounting activities.

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Modernizing Financial Close and Consolidation with Best-of-Breed Corporate Performance Management Solutions

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This is a guest post from Michael Morrison, CEO of Fluence Technologies, a partner of Revelwood. 

Ask an artist to show you what a tree looks like and they might create a beautiful painting that shows a maple tree’s leaves changing from green to orange and yellow at the height of autumn.

If you ask a scientist the same question, they’re more likely to walk through a detailed breakdown about the genus and species to which they belong, how tall they’ll grow and where they tend to thrive.

Now imagine you have to make a strategic business decision about trees: though both of them are valuable, it’s pretty easy to see why the scientist would become your preferred source of expertise. Some disciplines may be a mix of art and science, but others are more clear-cut. The differences between financial planning and analysis (FP&A) and financial consolidation are a perfect case in point.

The strategic roadmaps FP&A teams develop for their organizations could be considered an art in the sense that they involve studying data in the context of organizational objectives and finding insights that will chart a successful path forward. While the results need to be firmly grounded in fact, there’s some creativity involved.

“Creative” financial consolidation, on the other hand, is of no help to anyone in an organization, especially its leadership team. When companies consolidate and close the books using manual, ad-hoc processes, they risk introducing errors, inconsistencies and wind up taking accounting teams more time than they should. Instead of a clear representation of where the business stands, the result is more like an abstract painting that’s difficult to interpret.

Financial consolidation needs the rigor of science because it provides the foundation on which all the creative thinking is built. This includes budgeting and planning, but also identifying growth opportunities and operational efficiencies.

Perhaps even more importantly, financial consolidation is key to meeting reporting requirements, where the accuracy of balances, journal entries and intercompany matching is essential to a successful audit.

With these kinds of requirements in mind, it’s no wonder growing companies often struggle to choose the right technology solutions. This is where a best-of-breed approach provides functionality with flexibility to address the needs of those involved in both financial consolidation and FP&A.  

A Brief History Of Best of Breed

Anyone who has ever gone camping with a Swiss Army knife can appreciate the versatility of an all-in-one platform.

When you’re spending time in the woods, for instance, a Swiss Army knife has the advantages of being small to pack, light to carry and containing all the tools you might need during your trip. This not only includes a blade for cutting but a tiny magnifying glass, a corkscrew and even a fork.

Once you’re back at home, though, using the fork in a Swiss Army knife for eating at your dining room table feels almost ridiculous. Instead, we turn to what might be called a best-of-breed fork – a utensil that was built specifically with a single purpose in mind.

Something similar has been going on within organizations that originally standardized many of their business functions on an enterprise resource planning (ERP) platform. This is the Swiss Army knife of software, handling not only accounting but procurement, project management, supply chain operations, payroll and more.

An ERP might be fine if the company using it never bought another firm, or if it decided never to expand into other markets or add more customers. The reality is that M&As often lead to a single company owning multiple ERPs, complicating financial consolidation by requiring deep integration and fine-tuning.

“Best-of-breed” can be defined in many ways, but think of it as technology that is purpose-built to do one job really well. You’ll recognize these solutions because they tend to be:

  • Cloud-based: Traditional, on-premise solutions tend to lock companies into features that become difficult to update or change. Software-as-a-Service (SaaS) financial consolidation solutions make data more accessible while providing a streamlined upgrade path.
  • Out-of-the-Box: Instead of bringing on an army of consultants to set up and deploy them, best-of-breed solutions can be set up in far less time, with key functionality ready to be used immediately.
  • User-centric: An ERP might be designed with almost every business function in mind. A best-of-breed solution hones in on the specific needs and challenges of a particular team or set or role. In this case, it means finance and accounting professionals will see features that align with their ideal workflow.

Sometimes the prospect of researching and selecting best-of-breed software might seem so daunting that companies are tempted to put it off indefinitely. There’s a risk in doing nothing, however.

Sticking with an all-in-one platform like an ERP (or several of them) means finance and accounting teams might run into consolidation challenges that require them to figure out workarounds – another form of “creativity” with all the risks we walked through earlier in this post.

Maintaining the status quo could also make consolidating, closing the books and reporting on the data more of a chore for already-overworked teams. Companies that want to hold onto these valuable employees (or avoid the threat of “quiet quitting”) should think about what a best-of-breed solution could mean for the employee experience.

Finally, failing to make best-of-breed solutions a priority means you may become less agile, productive and strategic as competitors who opt for more modern technologies to navigate uncertain economic times.

Fortunately, making the shift to best-of-breed finance software isn’t as difficult as you might imagine.

Best Practices For Choosing And Deploying Best-of-Breed Software

Your search for the right best-of-breed financial consolidation and close solution will depend in part on the catalysts that started you on this journey in the first place.

For fast-growing companies, it often stems from a combination of outgrowing tools such as static spreadsheets or facing enough complexity (M&A, international growth, intercompany transactions, etc.) that ERPs no longer make sense.

As you evaluate the options, consider the following principles:

1. Tie Clear Goals To Finance And Accounting Performance KPIs

FP&A and accounting groups already track plenty of metrics, from working capital to net profit margin, compound annual growth rate and beyond. In this case, though, you want to think more about the key performance indicators that demonstrate success among your team members.

These could include time spent completing the financial close, time spent reporting, error rates and more. Make sure you’re not constrained by a platform where the number of scenarios or versions you can work with are limited – you may only close the books once a quarter, but modern FP&A needs to support continuous planning processes. 

Settling on a few of these KPIs – and setting goals to move the needle on them – will ensure you select the right best-of-breed solution for your business.

2. Scope The Full Breadth Of Feature Capabilities That Matter

It’s easy to get used to the way things have always been done in FP&A and close and consolidation. This is an opportunity to dream a little, looking at the functionality that will meet your current needs and those that may come up as your firm continues to grow.

For instance, some of the most burning issues could be integrating data from multiple locations and subsidiaries, or consolidating and reporting financial results across multiple hierarchies. 

Over time, though, you may also want to think about how your potential solution can streamline the dissemination of financial data into board books, dashboards and other forms of reporting to help key stakeholders. The right product should also assist with what-if analysis for those doing the “creative” work in FP&A.

3. Assess Current And Future Finance Data Complexity

Regulatory compliance is an ever-evolving beast, as is the nature of what guides strategic direction in a company. Best-of-breed technologies should therefore offer a seamless way to bring together both financial and non-financial data to create a more comprehensive picture of business performance.

Why non-financial data? Because a true best-of-breed solution supports company-wide planning, where line-of-business leaders and their teams can adapt models to reflect their specific goals and allow them to easily collaborate with other functional groups. 

Factor in variables such as having to contend with multiple languages, multiple currencies and any planned M&As or growth tactics will affect the chart of accounts you’ll need to manage.

And of course, all this should come with strong security and a complete audit trail. Data integrity is not a nice-to-have. It’s essential.

4. Determine The Degree Of Finance Ownership

Given the technical nature of ERP and similar enterprise-grade software, it has traditionally been up to IT departments to procure and make changes to the technologies used by finance departments. Cloud-based platforms today should require less oversight and intervention by the CIO’s team, however. Instead, accounting and FP&A groups should steer the overall roadmap for which new features should be turned on (and when), as well as any changes to business processes like the monthly close.

A good example is reporting: best-of-breed platforms should mean an end to the days when IT had to help finance teams develop reports. Instead, self-service reporting capabilities should support the development of ad hoc reporting so the company can respond to changes with intelligence and speed. 

Calculating Best-of-Breed ROI And Next Steps

Automation should always accomplish a few key objectives. It should bring speed and simplicity to otherwise difficult or complex processes. It should position employees to focus more on the tasks that make the best use of their time, experience and expertise. And it should create greater standardization and consistency as it offers more trustworthy data for the business’s strategic use.

Best-of-breed financial consolidation and close software can tick all of these boxes, and many more. The return on investment should be based in part on factors such as:

  • The ability of the solution to scale with the business
  • The ongoing development of more sophisticated features tied to user needs
  • The ease with which the platform can work with related solutions and technologies
  • The ability to answer increasingly complex questions

The shift to best-of-breed finance software is also not one fast-growing companies have to make on their own. Watch this on-demand webinar by Fluence and Revelwood, where we go into more detail about actionable steps that will help you reduce the time to value and reap the biggest benefits.

This blog post was originally published on the Fluence Technologies blog.

Read more about Financial Close and Consolidation:

Nucleus Research Finds 50 – 150% ROI on Financial Consolidation and Close Solutions

FP&A Done Right: The Role of Narrative Reporting in ESG

Fluence Technologies Earns “Outstanding” Overall BPM Pulse Rating from BPM Partners

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Continuous Accounting vs The Risk of Doing Nothing

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This is a guest post from our partner BlackLine, explaining the value of Continuous Accounting.

Change is uncomfortable. We all tend to resist change when we see it coming—and even more when we don’t.  Many go to great lengths to avoid what is different, especially at work.

We have our routines down pat, we can practically perform accounting processes in our sleep (and often do, especially during the close), and we like that familiarity.

But what if making a carefully calculated pivot to the right technology could actually be safer?

The reality is that although change is uncomfortable, it can be more dangerous to live with outdated manual processes and the inherent risks of human behavior.

The Risk of Doing Nothing

New possibilities to create competitive advantage present themselves all the time. This may seem overwhelming, but technology can lead to opportunities for accountants to evolve and add an even higher level of value to their organization.

Automation streamlines the most routine, manual work, and opens the door to Continuous Accounting:  an approach that ultimately results in better-utilized resources.

Continuous Accounting transforms the way accounting and finance teams work by embedding automation, control, and period-end tasks within daily activities. It frees up accountants to partner with the broader business, helping to drive more informed decisions for the organization.

Process automation provides one of the greatest opportunities for competitive advantage and waiting to adopt the right technology heightens the risk of being left behind—in your industry and in your profession.

If you decide to do nothing “for now,” but your competitors and peers choose to innovate, adopting automation and a Continuous Accounting model, they will quickly set themselves apart, becoming more efficient and controlled.

They will have access to the financial information needed to inform better decision-making and gain insight into bottlenecks.

Reducing the Resistance with Continuous Accounting

When you are performing most of your month-end close processes during a defined close window, it’s difficult to provide any meaningful financial data until after “pencils are down” – which is typically several days into the new month when the data is no longer relevant.

If you continue accounting the way it’s always been done, you’ll stay trapped in the never-ending cycle of feeling behind, always reporting on last month while the business has moved on to the next.

Leveraging technology allows accounting organizations to perform certain activities more real-time, increasing visibility to prevent surprises. By analyzing smaller subsets of data on a regular basis, you can identify irregularities in a timely manner, allowing the business to react appropriately and forecasts to be updated when needed.

“A big win with Continuous Accounting is automating certain areas. This means that rather than spending valuable time in the weeds of transactional data, you’re analyzing and reviewing exceptions,” says Molly Boyle, Director of Solutions Marketing at BlackLine.

Accounting in real-time isn’t possible without the technology that can drive automation and visibility. When the manual processes are automated, your accounting team is freed to focus their time on reporting and analyzing data to identify trends or adjustments.

When you begin providing meaningful data to decision-makers, and when you can do so in a timely fashion, your value to the organization increases substantially.

The End-Goal of Continuous Accounting

The goal of Continuous Accounting is to create a more synergistic organization where accounting and finance have a seat at the table. The most effective decisions are made when different departments make them together, with the real-time reporting data that tells the full story.

But a series of steps are required to take you from doing nothing to a fully Continuous Accounting approach. And it’s essential to start by defining the end state so you know exactly what you want to work toward. You can then work backwards to break down and delegate the steps that will get you there.

These five steps provide a framework to get you started:

  • Evaluate your existing processes first, to avoid automating bad processes.
  • Thoroughly research the best finance automation solution to ensure that you implement the right technology.
  • Focus on the benefits – instead of your fear of change.
  • Start small with a stepwise approach that will prove the risk mitigating benefits of Continuous Accounting
  • Begin to view industry advancements as improvements, so you can recognize the most beneficial opportunities.

Continuing to repeat these steps will shift your mindset and create a ripple effect in your organization. You’ll begin to see a reduction of risk, more timely data for business decisions, and a better utilized, more engaged accounting team.

And eventually, you will realize that the uncertainty and discomfort of change have become worth it – if not a little more manageable.

Driving Your Organization to the Next Level

It may seem like less effort to stay where you are. But waiting to implement a Continuous Accounting approach could come at a much greater cost, putting you at a disadvantage that may ultimately leave you reeling.

Change is inevitable for any company striving to create competitive advantage and staying stagnant is far riskier than implementing new technology to improve old processes. For this reason, getting comfortable with being uncomfortable can drive your organization to the next level.

This blog post was originally published on the BlackLine blog.

Read more Financial Close & Consolidation

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BlackLine Demo: Bank Reconciliations

BlackLine Demo: Loading Subledger Data into a Reconciliation

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Revenue Cycle Management

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This is a guest post from our partner BlackLine, explaining how revenue cycle management helps businesses be more responsive to changing market conditions.

Today’s business environment is more dynamic than ever. Business leaders are focused on strategic initiatives to position their companies for long-term growth, to gain competitive advantage, and to drive shareholder value.

Top of mind for many business leaders are topics like recruiting and retaining top talent, remote work enablement, mergers and acquisitions (M&A), and digital transformation, to name a few.

As business leaders focus on making strategic decisions around these areas, accounting teams are being increasingly relied upon to provide data and insights and to serve as strategic advisors to the business.

This post is part of a series that discusses areas of focus that require active accounting input, why it matters to accounting leaders, and the risk of doing nothing.

Cash is King

The revenue cycle, or order to cash cycle, refers to the entirety of a company’s ordering system and can involve many departments — from sales and accounting to inventory and logistics. It starts the moment a customer places an order and continues through when an invoice is settled, and all activity in between is recorded and reconciled.

All eyes are on the revenue cycle. Not just because it’s an essential function in finance and usually carries the most risk, but because it is a critical part of how an organization functions. The efficiency and effectiveness of the revenue cycle has an impact beyond sales and finance, including customer experience and retention, investor decision-making, and future organizational strategy.

From an investor, net income, and EBITDA perspective, the most important part of the revenue cycle is not what is invoiced, shipped, or billed, but rather what is collected. According to a PwC report, improved working capital management could unlock $1.4 trillion globally, increasing the return on invested capital by 8.8%. Maximizing profit is the end goal, and therefore limiting write downs, closing the gap between gross and net revenue and limiting the reasons companies fail to collect are of paramount importance. Further, cash flow fuels critical business strategies from maintaining customer service to investing in new areas, and so as they say: cash is king.

The Bottom Line

There are several reasons why a company fails to collect on what they invoice, but manual processes are the biggest driver. Within the revenue cycle, Finance and Accounting is dealing with a tremendous volume of individual transactions. When there is not an automated process for handling that data at scale, the result is preventable, but unavoidable, write-offs.

MGI Research estimates that 42% of companies experience some form of revenue leakage and according to a study published by EY, on average companies can expect 1-5% of realized EBITA to leakage, causing a direct hit to the bottom line. As such, this is not just a reconciliation problem—or even just an accounting and finance problem—it’s a bottom-line issue that company leaders and investors will notice.

Given the attention on cash in the current market conditions, it is of utmost importance to take action over areas that we can control and, in doing so, position our organizations and our companies for success.

This blog post was originally published on the BlackLine blog.

Read more about Financial Close and Consolidation:

Financial Close & Consolidation: The Vital Need for Automating Accounting

Modern Accounting: Adjusting Journal Entries

Modern Accounting: Highlights from Beyond the Black 2022

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BlackLine Demo: Balance Sheet Reconciliation Modules

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Did you know BlackLine’s modern accounting software has many time-saving features in its balance sheet reconciliation module?  

In this video, Adam Riskin, financial close and consolidation practice leader at Revelwood, shows you how to save time on balance sheet reconciliations when using BlackLine. These features include:

  • Auto certification rules
  • Populating GL balances
  • Reporting

Watch this video to learn how to use BlackLine for balance sheet reconciliations.

Revelwood is a BlackLine Gold Solution Provider with a team of former accountants and financial systems professionals. We help companies streamline, automate and modernize time-consuming accounting tasks for transformative changes in accounting processes.

Watch more BlackLine demos and videos:

Loading Subledger Data Directly Into a Reconciliation with BlackLine

Month-End Close Checklist with BlackLine

Matching Records from Multiple Files with BlackLine

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BlackLine Demo: Bank Reconciliations

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Did you know BlackLine’s modern accounting software can help you automate and streamline bank reconciliations? 

In this video, Adam Riskin, financial close and consolidation practice leader at Revelwood, shows you how fast and easy it is to perform bank reconciliations in BlackLine. 

Today most companies use Excel to do bank reconciliations. They import the bank statement data into Excel. They also import the General Ledger journal entries into Excel. Then they do a side-by-side comparison. This is tedious and can be error-prone. 

Watch this video to learn how BlackLine uses matching logic on bank reconciliations.  

Revelwood is a BlackLine Gold Solution Provider with a team of former accountants and financial systems professionals. We help companies streamline, automate and modernize time-consuming accounting tasks for transformative changes in accounting processes.

Watch more BlackLine demos and videos:

Loading Subledger Data Directly Into a Reconciliation with BlackLine

Month-End Close Checklist with BlackLine

Matching Records from Multiple Files with BlackLine

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Nucleus Research Finds 50 – 150% ROI on Financial Consolidation and Close Solutions

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Nucleus Research has determined that SMBs can expect a “payback period of 12 months and an average annual ROI of 50 to 150 percent within the first three years of deployment” for financial consolidation and close solutions. 

The analyst firm is a global provider of ROI-focused technology research and advisory services. According to Nucleus, “Midsized companies contend with the same accounting complexities of large enterprises with multiple business units spreads across various geographies and industries, but often lack the budget and bandwidth for a drawn-out implementation.” These companies turn to midmarket financial consolidation and close solutions to “migrate off disjointed Excel processes while lowering the technical and cost barriers of traditional enterprise technology.” 

Nucleus defines financial consolidation and close (FCC) solutions as “covering the consolidation and reporting of financial information for the monthly, quarterly, and annual close … [they] help organizations streamline daily tasks for accountants, controllers, and the CFO.” 

Furthermore, Nucleus explains that “midmarket companies deploy an FCC system when they have difficulty meeting compliance requirements, reporting actuals on a timely basis, evaluating the progress of accounting processes, and visibility to financials across their various functional departments, sales channels, and subsidiaries.”

Download the report today to learn about the benefits of FCC solutions, including:

  • Productivity
  • Cost reductions
  • Revenue drivers
  • Organization visibility
  • Culture and morale

The report also covers the total cost of ownership (TCO) of FCC solutions.

This report is courtesy of Revelwood’s partner, Fluence Technologies.

Read more about Financial Close & Consolidation:

Fluence Technologies Earns “Outstanding” Overall BPM Pulse Rating from BPM Partners

Financial Close & Consolidation: The Vital Need for Automating Accounting

Modern Accounting: Adjusting Journal Entries

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Fluence Technologies and Revelwood Enter Strategic Partnership

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Today we announced a new strategic partnership with Fluence Technologies, the only pure-play provider of financial close and consolidation software purpose-built for mid-sized companies.

“The Office of Finance is charged with many tasks to help their organizations run efficiently and effectively,” said Ken Wolf, CEO, Revelwood. “We have more than 25 years of experience working with finance solutions to improve business performance. By adding Fluence to our best-in-breed software portfolio, we are addressing one more key aspect of financial management – financial consolidations.”

“Fluence may be new to Revelwood, but our teams have worked together for decades,” said Michael Morrison, CEO, Fluence Technologies. “Revelwood’s expertise, strategic vision and passion will help ensure we deliver comprehensive consolidation and performance management systems to our joint clients.”

Fluence Technologies, a leader in the cloud financial close and consolidation space, offers a purpose-built solution that is easily owned and maintained by finance, while also providing the power and functionality of the most robust enterprise solutions.

Read the full press release.

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