Why continuous accounting should be the norm in 2021?

Accountancy services in UK

January 22, 2021

The importance of on-demand access to core financial data has been highlighted by COVID-19. For most of the business leaders, cash flow quickly climbed to the top of the list of priorities as they suddenly needed to develop an accurate forecast for the immediate future by knowing how much cash they had on hand. To emerge from the situation stronger and to modernize the accounting practices, the most stable businesses have got an opportunity to make strategic investments. 

Many accounting and finance professionals continue to struggle with highly manual month-end close processes and inefficient despite unprecedented advances in workplace technology. Continuous accounting empowers finance to close the books with greater accuracy and more quickly as well as embeds automation and control

Instead of being reactive gatekeepers, continuous accounting empowers accounting and finance teams to serve as proactive business leaders. A continuous accounting framework can routinize accounting tasks and liberate accounting team from mundane and error-prone work. These enabling technologies empower to focus on time, creativity, and innovation on business growth and will augment the role of modern accounting and finance professionals.

Continuous accounting is a process enabled by automating routine accounting tasks as well as the ones that require complex calculations – like depreciation or amortisation. The role of technology in supporting the continuous close approach is essential as compiling large volumes of financial and non-financial information efficiently is no easy feat.

Continuous accounting helps to establish the strategic role of finance and provides visibility as well as accuracy in less than half the time. In short, the role of the team becomes that of an internal auditor, which reviews the automated setup for material errors and testing transactions to keep things in check.

To help them meet organisational priorities, an accountant’s most critical skill is distilling data in a way that matters most to decision-makers and to allow accounting staff to add more value as well as improve processes, they must create a culture of collaboration both within finance teams and other departments.

Managers should focus on helping individual team members build and maintain strong relationships as well as design a process for monitoring critical business information and accessing the data in real-time to deliver both short and long-term business value.

Continuous accounting is a team effort between finance and IT. The employees are a critical resource for this transition who can bridge the gap between accounting and technology. Therefore, regardless of size or industry, the continuous accounting is a realistic goal for businesses. The continuous accounting is one type of innovation which will benefit everyone whoever is involved in it.

Continuous Accounting Model is an approach which offers many benefits and it smooths out the spikes in activity as well as puts an end to the end-of-period scramble. The productivity and visibility, improve and it will be easy to access real-time information so that performance of business can be analysed easily. Also, with this, the finance team can add more value to their organisation than ever before.