Guide · October 16, 2024
CFO Guide to Month-End Close Automation
Introduction
The month-end close process can sometimes be a daunting, time-consuming task in the fast-paced world of corporate finance. And as organizations grow and financial operations become increasingly complex, the demand for efficient, accurate, and timely financial and non-financial reporting becomes ever more critical. Making the reporting even more complex is that finance teams have typically relied on disparate data sources, siloed processes, and fragmented tools to deliver functional requirements.
The result? Onerous manual reconciliation processes and inconsistent outputs.
These challenges are further compounded by years of under-investment in digital transformation and systems rationalization. As a result, finance teams are already struggling to deliver against their existing mandate and cannot evolve into an expanded strategic role. Automation and Enterprise Performance Management (EPM) software has become essential in this environment.
This guide is designed to help CFOs and their teams navigate the challenges of automating the month-end close process. We’ll explore the benefits of automation, list some implementation best practices for leveraging EPM software to streamline financial operations, and share some customer success cases.
Current Challenges in the Month-End Close
The traditional month-end close involves several complex steps — data collection, data validation, currency conversion, intercompany reconciliation, and more. Why so complex? Multiple data types and currencies are consolidated, ownership structures must account for intercompany transactions and balances, and complications like tax add still more layers. Before results can be distributed internally and externally, many different roles and multiple levels of approval and sign-off are involved.
The close process brings five recurring challenges:
Inconsistent data
Data accuracy and integrity are fundamental to the month-end close — they ensure financial statements are reliable, trusted, auditable, and compliant with all global regulatory requirements. Because finance data comes from various sources and systems, it’s prone to errors, inconsistencies, and discrepancies, a problem compounded by the steady increase in disclosure and notes requirements — including ESG reporting — which requires more non-financial data to tie back to the financial figures. Organizations with high transaction volumes, manual data entry, and complex spreadsheets face additional challenges maintaining accuracy and integrity, leading to time-consuming reconciliation and potential inaccuracies in financial reporting.
Limited visibility
Limited visibility into the status of month-end close processes adds latency and uncertainty. Finance leaders may struggle to track progress, identify bottlenecks, and ensure all tasks are completed accurately and on time. This lack of visibility and control can lead to last-minute rushes and a higher risk of errors.
Compliance risks
When managing multiple entities, currencies, and intercompany requirements amid ever-changing global and local regulations and standards, finance teams in complex organizations face still more challenges. Many financial consolidation systems simply weren’t built to handle this level of complexity — so organizations relying on legacy point solutions fall back on manual processes, complex spreadsheets, and time-consuming reconciliation to close the gaps, creating inefficiency, potential inaccuracies, and, worse, compliance issues.
Delays
Many organizations still heavily rely on spreadsheets and manual processes during the month-end close. Beyond being time-consuming, manual data entry, spreadsheet-based calculations and reconciliations, and ad-hoc reporting are also prone to human error — inefficiencies, delays, and inaccuracies that add to the stress of the month-end close.
Complex disparate systems
Finance teams often work with multiple EPM systems and tools. Over the past three decades, finance has been conditioned to implement best-of-breed consolidation and close solutions for account reconciliations, transaction matching, tax, and planning and forecasting. These solutions have varying levels of detail and complex integrations, and cause data duplication, so they don’t seamlessly integrate with each other. Unifying this in one single EPM platform significantly reduces complexity and maintenance effort, and better aligns external statutory and internal management reporting. The duplication of data and metadata between disparate EPM systems adds time, creates complexity, and becomes a key contributor to inefficiencies in the month-end close.
The Benefits of Month-End Close Automation
So… why automate?
Automation has been a big topic for organizations ever since the Industrial Revolution brought machines to work where manual labor had traditionally been the only method. Bringing automation to finance processes — including the month-end close — has moved to the top of the agenda for forward-looking finance leaders looking for ways to better support their organizations and drive real impact on performance.
Want proof? Just think about how much time you and your team spend manually copying and pasting information between fragmented sources and tools, as opposed to analyzing results and helping your business partners take action.
The benefits of automation to the month-end close can be significant:
Efficiency gains
Achieve faster close times by identifying and reducing repetitive manual tasks, automating all processes in a single unified platform, and streamlining critical processes with interactive visualization and collaboration capabilities to increase both control and accountability.
Enhanced collaboration
Better coordinate and communicate to more equally distribute workloads and reduce manual tasks, leading to fewer temporary staff requirements at peak times, more team cohesion, and people doing more work aligned with their qualifications.
Accuracy and compliance
Reduce errors and improve regulatory compliance with out-of-the-box support for local and global regulations, reporting standards, and tax to streamline consolidations and treatments needed for accurate financial reporting.
Improved data insights
Access real-time, accurate financial data to increase visibility into financial and operational activities, ensuring users can effectively identify actions and enable informed decisions at the speed required.
For any organization, even minimal movements in the above can make a significant difference. Closing faster with better data is a sign of leadership, strength, and strong governance. In turn, organizations can make better decisions, maximizing new opportunities and investor and stakeholder confidence in the market.
Key Features of EPM Software for Automating the Month-End Close
When evaluating software options for the month-end close, it’s critical to ensure the best capabilities are available and proven in the market. The solution should be capable of supporting the organization now and well into the future — organizational change can come at any time, and while regulatory change tends to come with some notice, it can still be significant, such as the recently introduced ESG reporting requirements.
An effective EPM solution should include the following capabilities:
A fully unified approach
With a unified, cloud-based platform like OneStream, all capabilities for the close are in a single solution. This unified approach reduces the complexity of multiple applications or instances and streamlines all month-end close data and processes in one place. OneStream’s Digital Finance Cloud is unique because it’s powered by a true platform — unifying all financial consolidation, close (account reconciliations, transaction matching, ESG, and tax), financial and non-financial/operational planning, reporting, and analysis processes in a single solution and data model.
Account reconciliation automation
Manual account reconciliation can be an extremely time-consuming activity, one with all-too-often frustrating results. Many finance teams have lost countless hours and even days attempting to reconcile balances — often resorting to Excel when transactional detail is required to make sense of differences. Automating this process can be transformational, saving significant amounts of time. Effective account reconciliations require a process that is not only automated but also fully unified with the financial close: if GL trial balances are loaded into a single system for consolidation, reporting, and account reconciliations, the data stays synchronized and the close is faster and more efficient.
Data integration and quality
EPM software integrates data from various sources, including ERP systems, CRM systems, and other financial tools, ensuring a single source of truth for financial data and reducing manual, time-consuming data loading and manipulation. Financial data quality management (FDQM) lies at the core of a unified solution — a key requirement is 100% visibility from reports to sources, so all financial and operational data must be clearly visible and easily accessible.
Automated transaction matching
A unified EPM system should include an automated transaction-matching capability to help resolve differences and accelerate the account reconciliation process by quickly matching transactional data from multiple sources. Because such matching uses a rule-based approach, users can focus only on exceptions and drive process efficiencies.
Workflow automation
The solution must include guided workflows that protect business users from complexity by guiding them uniquely through all data management, verification, analysis, certification, and locking processes. By standardizing tasks, approvals, and notifications, automated workflows streamline the month-end close, reducing bottlenecks and ensuring timely completion.
Audit trail & security
Comprehensive logging for compliance and audits is essential: every metadata and data value added, changed, or deleted should be tracked and logged so users know the who, what, when, where, and before/after values of every change — with no option to disable audit logs, and no compromise to performance while all audit controls are running. Overall, the EPM solution should provide robust security features, including role-based access controls and data encryption, to ensure data integrity and regulatory compliance.
Advanced analytics and reporting
Through a broad range of reporting and analytics capabilities, a unified solution helps reduce reliance on spreadsheets and fragmented reporting tools, increasing the speed, scope, and accuracy of reporting across the organization. The most advanced EPM software lets CFOs generate detailed financial reports, dashboards, and forecasts — improving both decision-making and strategic planning.
Artificial intelligence (AI) & machine learning
AI and machine learning enhance the month-end close by identifying recurring data patterns, detecting anomalies, and predicting potential issues — analyzing large volumes of real-time financial data to surface insights and recommendations that improve accuracy and efficiency. With modern finance platforms like OneStream, AI and machine learning are finance-focused, built directly into the platform as a core service, and work across all processes — eliminating the need to move data out of the context of the process.
OneStream’s Self-Service Reporting & Analytics
Selecting the right solution
Selecting the right solution is one of the first steps to successful automation. But when you’re preparing to automate, the way it’s done — how the solution is implemented and rolled out to users, and how training and enablement are deployed — are all key steps.
The following 10 steps are key to achieving successful automation:
- Engage stakeholders — involve key stakeholders early in the process and build consensus.
- Select the right technology — decide your criteria for choosing the right automation tools and software.
- Govern data — ensure a focus on improved data accuracy and security.
- Customize and scale — check availability to adapt tools to fit specific needs.
- Regularly monitor and update — ensure you can easily keep the system up to date.
- Assess current processes — evaluate existing month-end close procedures to identify manual processes that can be automated.
- Define objectives and KPIs — establish clear goals and metrics for automation improvements.
- Plan and execute implementation — create a step-by-step implementation plan.
- Train your team and employ change management — fully prepare your team for the transition with advance training.
- Continuously improve — regularly review and optimize the process.
In conjunction with the steps above, begin by automating specific aspects of the month-end close process and gradually scale to more complex tasks. This approach allows your team to adapt to the new system and minimizes disruption. Never under-invest in training — instead, do what’s needed to ensure your finance team is well-trained in using the EPM software, then provide ongoing training and support to keep everyone up to date with new features and functionality.
Customer Success
BDO enhances information delivery
BDO is a U.S. professional services firm that provides assurance, tax, and advisory services to multinational clients through a global network of over 80,000 people working in 1,591 offices across 162 countries.
The BDO team, led by CFO Lynn Calhoun, selected OneStream because it met three primary requirements: scalability, information delivery, and data integrity. OneStream fit the bill as a platform that could handle larger data volumes as BDO grows and empower key decision-makers with accurate information and rich dashboarding and reporting capabilities. By combining multiple disparate data sets, OneStream creates “one source of the truth” for BDO.
OneStream helps BDO align its external, legal, management, and FP&A processes within a single solution, while providing a framework to address different levels of detail between budget/forecast collection and actuals reporting across accounts, cost centers, and departments — providing additional granularity for reporting and planning across various lines of business in a single, unified data model.
BDO leverages OneStream’s financial signaling capabilities to report on and analyze large volumes of daily transactional data, loading 10 million records nightly. Those records are transformed into 30 to 40 million rows of data through OneStream, then made available to BDO’s users via an interactive dashboard.
Customer voice“We now have happy users who are able to absorb information the way they want with self-service reporting and dashboards. This includes a wide range of information, not just financial — including managing people and clients.”
McCain Foods automates to efficiency in OneStream
McCain Foods Limited is a Canadian multinational frozen food company established in 1957 in Florenceville, New Brunswick, Canada. Today, McCain Foods is a global company with 22,000 employees worldwide and corporate offices in Toronto, Canada — the world’s largest manufacturer of frozen French fries, potato products, and appetizers.
The company converted from SAP BPC to OneStream’s Intelligent Finance Platform for financial consolidation, financial reporting, and management reporting, and added lease-accounting capabilities — completing the whole project within seven months to meet the implementation date for IFRS 16.
| Platform | Load time |
|---|---|
| SAP BPC (flat files) | 1–5 hours, depending on region size |
| OneStream | 20 minutes |
With 300 happy users, McCain Foods is benefiting from a simplified month-end close. The company now loads approximately three million data records per month into its OneStream environment. And from an administrator’s perspective, the platform is more automated and much easier to use — resulting in more engagement from controllers logging in directly to the system.
Customer voice“We love the guided workflow functionality in OneStream. It ensures we’re assigning the right tasks to the right team members and provides a visual overview of what is required at each month and quarter-end. It also supports great corporate oversight on how we are progressing through the month-end close.”
In Summary
Automating the month-end close process with EPM software is a strategic investment that will yield significant benefits for your organization. By increasing efficiency, improving accuracy, enhancing visibility, and ensuring compliance, you can transform your financial operations and drive better business outcomes.
As a CFO, you must lead this transformation and champion the adoption of automation within your finance team. You can successfully implement EPM software and achieve a more streamlined, efficient, and effective month-end close process by following the guidelines and best practices outlined in this guide. For the reasons highlighted throughout this guide and more, OneStream has become the trusted vendor of choice for more than 1,500 organizations globally.
Embrace the power of automation and take your financial operations to the next level. The future of finance is automated — and that future starts with you.
Learn more
View the whitepaper → Read “Mastering the Financial Close” for a deeper dive into best practices. Sign up for a live demo webinar → Take the next step and see OneStream in action.FAQ
Frequently asked questions
What are the biggest challenges in the month-end close?
Inconsistent data, limited visibility into process status, compliance risk, delays, and complex, disparate systems — most stemming from the disparate data sources, siloed processes, and manual reconciliation that finance teams have relied on for years.
What are the benefits of automating the month-end close?
Automation delivers efficiency gains from faster close times, enhanced collaboration through better-distributed workloads, improved accuracy and compliance with built-in support for reporting standards, and improved data insights from real-time, accurate financial data.
What key features should CFOs look for in EPM software for the close?
A fully unified platform with data integration and quality management, workflow automation, account reconciliation automation, automated transaction matching, an audit trail and strong security, advanced analytics and reporting, and finance-focused AI and machine learning.
What are the steps to successfully automate the month-end close?
Ten steps: engage stakeholders, select the right technology, govern data, customize and scale, and regularly monitor and update, alongside assessing current processes, defining objectives and KPIs, planning and executing implementation, training your team and managing change, and continuously improving.
How have OneStream customers benefited from automating their close?
BDO now processes 10 million transactional records nightly — transformed into 30 to 40 million rows — through a single source of truth, while McCain Foods cut its regional data-load time from up to five hours to 20 minutes and completed its OneStream implementation in seven months.
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