Boston—Feb. 27, 2013—Severe flaws in month-end reconciliation processes create distrust in finance departments in the U.S. and Europe, leaving only 28 percent of respondents able to trust the reported numbers, according to a survey of more than 300 financial professionals worldwide.
The Financial Close Benchmark Report by Adra Match, a global software firm specializing in advanced data matching and reconciliation management, pinpoints finance departments frustrated with the conflicting demands of accuracy and pressure to close each month’s books quickly.
“No matter where you go in the world, speed and accuracy are big challenges as new corporate governance regulations put increasing pressure on finance departments to ensure total visibility, traceability and central control,” said Martin Thunman, Chief Executive Officer, Adra Match. “Surprisingly, nearly three-quarters of respondents reported they do not trust their figures.”
The corporate balance sheet is required to provide an accurate picture of a company’s figures. But all too often the month-end close process is an error-prone and time-consuming scramble, the Financial Close Benchmark Report reveals.
Important highlights of the survey include:
- Only 28 percent of respondents trust the reported numbers
- Managers, such as CFOs, controllers, and finance directors, trust their numbers at a much higher rate (30 percent) than their staff (15 percent)
- 90 percent are under pressure to close faster
- Only 39 percent are satisfied with the quality of the closing process
Improving reconciliation management routines is one of the top three technology initiatives for financial organizations, as reported in the Gartner FEI Technology Study, May 2012. “As CFOs become increasingly aware of the serious challenges revealed in the Adra Match survey, this trend is certain to remain strong,” added Thunman.
The survey also uncovered some notable differences between the U.S. and Europe. For example, in the U.S., 34 percent trust the reported number versus 23 percent in Europe. Although the trust is higher in the U.S., two thirds of the respondents don´t trust the numbers.
- In the U.S., just over half of the respondents (53 percent) close their books within six days, but fully 73 percent of European respondents in the study close their books on that accelerated schedule.
- In the U.S., only 9 percent have no second approver during the close process versus 19 percent in Europe, indicating that more the American companies have tighter governance rules.
For more details of the Financial Close Benchmark Report, visit http://bit.ly/13tsNQF.