For many organizations, closing the books is an exercise in stamina and endurance. Nonprofit finance leaders often struggle with time-consuming manual tasks from sifting through a massive Chart of Accounts (CoA) to performing spreadsheet manipulations, consolidations, reconciliations, and information handoffs. For nearly 60%, the financial close process takes over a week, delaying access to reliable information vital to mission-critical decision making.
To better understand the close process and help you find ways to accelerate your time to actionable insights, we at Sage Intacct run an annual Close the Books Survey among finance and accounting professionals. Key findings from our 2021 survey reveal that more organizations are inclined to adopt cloud-based financial solutions than ever before. Additionally, our survey shows that cloud-enabled automation becomes a must for growing organizations especially since most accounting teams responsible for closing the books tend to be compact.
Some good news: Nonprofit organizations of all sizes can save on average 36% of their time during the month-end close by simply moving away from spreadsheets toward cloud financial management. Cloud financial management software that automates financial close processes allows organizations to keep running lean, even as they grow in size and complexity. Read on to learn five ways your organization can use Sage Intacct nonprofit accounting software to accelerate the financial close and become better equipped to provide strategic guidance to your organization.
1. Replace tedious manual tasks with automation
How much do manual tasks slow down the financial close process? Our 2021 Close the Books survey revealed that those most impacted by spreadsheet manipulation have closes that are 36% longer than those who are only slightly impacted.
The survey also identified other obstacles making a large impact on finance teams during the close including data imports and exports, information hand-offs, reconciliations, and investigating anomalies. The reality is that the time spent on these and other manual tasks often snowballs into lengthy close times and can lead your organization to make decisions based on stale information.
These challenges led Potential Church to search for a modern, cloud-based accounting solution. “Our team was plowing through tons of manual processes, paperwork, and data entry, which was frequently held up by QuickBooks backups or server maintenance…it was clear that we needed a cloud accounting solution to stay ahead of strategic changes that were placing new demands on accounting,” explained Reggie Alexis, controller at Potential Church. After just a six-week implementation, Potential Church slashed monthly close by 50%, reduced AP processing by 33%, and cut weekly revenue recognition from 5 days to 1 day.
“The biggest improvement we saw was the speed and accuracy of our monthly financial close, which now takes half the time it did with QuickBooks and is completely trustworthy.”Reggie Alexis | Controller | Potential Church
2. Create dynamic reports instead of spreadsheets
Nonprofits need timely, insightful financial reporting to make data-driven decisions to propel their mission forward. That’s what makes spreadsheet-based reporting so frustrating. It’s time-consuming and error-prone—and it can often take hours or days to track down the latest information or detect trends. Using cloud financial management software emboldens nonprofit finance leaders to use real-time dynamic reports and dashboards when planning for programs, fundraising, staffing, and more based on what’s really happening.
For example, Sage Intacct customer Seattle Indian Health Board uses the efficiencies gained from the software to spend more time on data analysis. In the past, it took the organization up to three days to generate about a dozen quarterly reports to federal funding agencies. They are now completing those reports in about 40 minutes with Sage Intaccta time savings of more than 20 hours a quarter.
“Sage Intacct has made a night-and-day difference. The ability to track, plan and measure data and get information into the hands of decision makers to ultimately benefit the community we serve has been invaluable.”Ben Leuty | CFO | Seattle Indian Health Board
3. Perform consolidation at the click of a button
Faster consolidations generally mean a faster close. But if your organization has multiple legal entities, performing consolidations quickly isn’t easy. That’s why nonprofit organizations need an accounting solution that is equipped to handle the complexities of multi-entity and multi-currency global accounting consolidations, including decentralized payables, inter-entity transactions, and currency conversions. Automating these and other consolidation activities eliminates hours to days of manual work so organizations can close the books 25-70% faster.
World Learning operates dozens of active programs around the world. The organization’s complex, multi-currency, multi-entity accounting requirements mean the finance team needs to track revenue and expenses in local currencies for tax reporting, consolidate the books in U.S. dollars, and produce quarterly grant spending reports for funders. Sage Intacct provides a multi-dimensional structure that makes it easy to track multiple currencies and entities and prepare consolidated reporting.
“With Sage Intacct, we close the books faster and with more accuracy, leaving us more time to work on projects that deliver the biggest impact to our beneficiaries.”Kote Lomidze | Chief Financial and Administrative Officer | World Learning
4. Ensure accessibility to data anytime, anywhere
There’s no question that the COVID-19 pandemic has had a major impact on business operations. Our Close the Books survey found that those organizations that were already cloud-based had a leg up when transitioning to a remote close. Cloud-based organizations were also able to improve accessibility to their data and ensure business continuity when experiencing a sudden transition from the in-office close experience to a remote workplace. For example, Nashville Zoo went live on Sage Intacct just weeks before the disruption of pandemic-related shutdowns in early 2020.
Being cloud-based also has additional advantages for Nashville Zoo, with Sage Intacct the organization slashed its monthly close in half, from 10 days to five. The accounting team also boosted their efficiency by 30% and now saves thousands of dollars through improved spend analysis.
“Prior to deploying Sage Intacct, closing our books was difficult because everything was completely manual and our prior reports wouldn’t balance… Sage Intacct simplified everything for everybody, and I have time to ensure the accuracy of our reports instead of scrambling to get them finished.”Kim Pridgen | CFO | Nashville Zoo
5. Make continuous close a reality
Making continuous close a reality starts with an intelligent general ledger providing continuous accounting, trust, and insight. Instead of waiting for the close to get prepared financial information, nonprofit organizations can leverage tight integration with other best-in-class solutions to capture and reconcile transactions in real-time and AI-powered functionality like Outlier Detection to monitor and analyze performance throughout the financial period. In our survey, 81% of respondents prefer a system that enables a continuous close yet only 6% are already using AI to help with their organization’s close.
To learn more about how to conquer your close, download our eBook, Living on the ledger.
Is your nonprofit finance team ready to improve efficiency and deliver insights days or even weeks earlier than they ever thought possible? Cloud solutions provide the foundation for automation and AI to transform the close so you can always have a current and accurate view of your organization. With more time on your side, you can focus on strategy and mission achievement. Accelerating the close takes you out of the ledger and keeps you ready for what’s next.
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