Periodic closure – The key for control

Today, companies management is expecting that the financial departments is contributing with up fresh data to support decisions and with a good overview over regulations.

If your answer is “no” to one or more of the questions below, you should continue reading to see how an effective and correct periodic closure can help your business:

•    Do the financial functions deliver what they are supposed to, in an effective manner and at desired cost?

•    Is reporting done in an appropriate manner?

•    Is your company focusing on the appropriate management parameters?

•    Does your company have the right competencies and capacities?

Experience shows that solid routines tied to an effective periodic closure gives:

•    Improved reporting and basis for analyses

•    Correct KPI’s and measurements

•    Improved budget and forecasting, and follow-ups

•    Effective transaction processes

•    Effective operation and organization of the financial function

•    More competent and content employees

An example of a periodic/monthly closure checklist with the use of Dynamics AX can be:

Date

Task/Description

Responsible

T-2

Open next period

 

T

Make sure that all delivered orders are invoiced (Status Sold)

 

T

Make sure that all received orders are posted (Status Purchased)

 

T

Updated exchange rated

 

T

Control and check all open finance/inventory journals etc.

 

T

Update fixed assets balance sheet

 

T+1

Carry out bank reconciliation

 

T+1

Draw balance list distributed by age, customers

 

T+2

Send out account statements/reminders to customers

 

T+2

Make sure that all costs of labor are issued and posted

 

T+2

Draw balance list distributed by age, suppliers

 

T+2

Carry out inventory/warehouse closing procedure

 

T+2

Post turnover

 

T+3

Close period

 

T+3

Draw trial balance

 

T+3

Draw profit and loss statement, balance report and division balance sheet

 

T+3

Draw stock value report and stock reconciliation

 

T+3

Draw cash flow forecasting and currency needs for the next period

 

T+3

Draw VAT-report, and report to authority

 

T+5

Report to management

 

(T = the first day in the next period)

This checklist will give your organization:

  • More effective periodic closure and reporting
  • Determined management and financial reporting
  • Effective budgeting, estimation and reporting
  • Improvement of structure and efficiency in the financial function
  • “Shared Service Center” and merger of financial functions possible
Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s