Welcome back, and I'm glad you've decided to join me in exploring this topic further. In this first lesson, we will discuss the sorts of things or activities that slow down the closed process. Let's begin by getting a better understanding of where perhaps you are today with your closed process. The addre match benchmarking study indicated that most companies were in the four to six day range, some were faster, and some are slower. Just for context. This benchmark report surveyed over 300 financial professionals from across North America and Europe.

72% Of the respondents were from companies with revenues greater than $100 million, and 92% of respondents close their books on a monthly basis. So arguably, you might think that the survey may have been skewed towards larger organizations. So I conducted a survey of my own. I leverage the performative community of financial professionals and perhaps Not surprisingly, got a similar albeit slightly slower closing cycle, as indicated by the overlay of the orange calendars on your screen. A few more respondents in the seven day range and a few less in the four to six day range. For those of you that are taking three weeks or more to close the books, I'm sure that you're noticing that by the time you finish closing one month, you're immediately working on the next, it doesn't leave a whole lot of time for the accounting department to add value to the organization.

In another study, the top bottlenecks in the monthly closed process were attributed to manual processes, lack of system integration, shortage of staff and or skills, inadequate data, processes that weren't being followed or lack formal definition. In other words, our closed processes could be inhibited by our people, our process and or our technology. The study indicates that technology is perhaps one of the biggest challenges many of us are facing. Take a moment to identify the factors that are slowing your clothes down the most. I'm just guessing here, but if I were to add a few of my own observations from the companies I've been involved with, I would worry about such things as all those handoffs of information that go on between the departmental silos, the operating divisions and the corporate accounting group. If you're waiting for someone in sales to enter all these sales shipments, or someone in purchasing to approve vendor invoices, then these sorts of waiting periods and handoffs are rarely seamless.

And wouldn't it be wonderful if every business was composed of just one chart of accounts, but realistically, very few organizations run like this when you have more To pull divisions and companies that need to be consolidated or combined. This is another type of handoff that makes life miserable for the corporate accounting team, and it only gets worse when there are multiple accounting systems and different accounting policies involved. Finally, consider the use of manual reconciliations and spreadsheets. It's not uncommon to see the operating units on one reporting system and the corporate reporting group on yet another and excel reconciliations between the two keeping everything balanced. xml is so common in business today that it's almost unthinkable to suggest that it's possible to eliminate XML altogether. However, I do think many companies place an over reliance on XML and default to it because of its ease of use and flexibility.

The problems I have with Excel are that no two people use Excel the same way Few people document their work adequately in Excel, and excel lacks a readily visible audit trail. For many of you getting away from Excel is entirely not realistic in the short term. But I fully believe that training people on using Excel and taking the time to establish and standardize how Excel will be used in your department can go a long way to improving our objectives of quality trustworthiness and timeliness. Let's pick up some more ideas about ways to improve how we conduct the closed process in our next lesson, and until then,