Speeding up the close :: essays research papers

Speeding up the sousedThe article I choose to review is Speeding 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 atomic number 18 coming up with alternative ways to reduce time and speed up the process to meet the impending 60-day deadline. This article discusses fiscal year and the abilities of companies to close the books quickly to access real-time financial results, which, in turn, lead to better decision making. Companies spend or invest funds in projects that hopefully submit the firm more profitable, having real-time financial results would make this more efficient. Faster closings means more time for the company to process the numbers, also a speedy close is a sign of the efficiency and success of management and the company. If management has real-time financial results it allows them to respond more efficiently to changes in the mar ket, which, in turn, divine service investors make significant investment decisions. The article goes on to discuss the pressure mounting for virtual close, but how urgent is it, and is it worth the investment? A play along was conduct of financial executives in companies to see if the pressure mounting for virtual close is significant often to proceed with further action. The Johnsson Group found less(prenominal) than one out of five respondents reported a fully automated close, more than half said that their close process is semi-automated and requires some manual intervention, and a quarter replied that their systems need significant manual intervention. Speed up the close should not be viewed as a vital step to be interpreted all at once, but as an evolutionary process. The concept of virtual close shows us how far the finance organization hit come in the pass couple of years in the time it takes to performing closings. Two-thirds of companies closed their books for the quart er in 4 to 7 business days, 16 percent argon accomplishing their closings in 1 to 3 days, but on other hand 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 incident know the rationale behind the processes and have a deeper understanding of the business.The next paragraph in this article discusses a more strategic graphic symbol for finance.