Speeding up the close :: essays research papers

hasten up the tightThe article I choose to review is velocity up the close by Gaye van den Hombergh and Laurie Streling from the magazine financial Executive June 2004 issue.Companies with a 12-month accounting period otherwise known as a fiscal year be coming up with alternate(a) ways to reduce time and speed up the process to realize the impending 60-day deadline. This article conversees fiscal year and the abilities of companies to close the books quickly to get to real-time financial results, which, in turn, lead to better decision making. Companies lead or invest funds in projects that hopefully make the unfluctuating more profitable, having real-time financial results would make this more efficient. Faster closings nub more time for the company to process the numbers, also a rapid close is a sign of the efficiency and success of anxiety and the company. If management has real-time financial results it allows them to respond more efficiently to changes in the marke t, which, in turn, help investors make epoch-making enthronement decisions. The article goes on to discuss the pinch mounting for virtual close, but how urgent is it, and is it worth the investment? A survey was conduct of financial executives in companies to see if the pressure mounting for virtual close is significant often to proceed with raise action. The Johnsson Group found less than one out of five respondents account a fully automated close, more than half said that their close process is semi-automated and requires some manual intervention, and a pull in replied that their systems need significant manual intervention. Speed up the close should not be viewed as a vital step to be taken all at once, but as an evolutionary process. The concept of virtual close shows us how far the pay organization have come in the prolong couple of years in the time it takes to performing closings. Two-thirds of companies closed their books for the quarter in 4 to 7 business long time , 16 percent are accomplishing their closings in 1 to 3 days, but on other give-up the ghost 21 percent of the companies reported needing more than 7 business days for closing. Although companies have to be prepared to confront certain issues while obtaining faster closing, like less emphasis on training, leaving companies with fewer finance historians who in fact know the rationale behind the processes and have a deeper understanding of the business.The next paragraph in this article discusses a more strategic role for finance.