The financial world is filled with best practices, many of which are very useful in the right circumstances.
Generally, the more basic the problem, the more readily available a generic best practice.
Conversely, the more unique the problem, the less applicable most generic best practices are to solving your unique problem.
At SVA, we believe that most companies have already developed much of the solution to their complex problems; our goal is to work with the existing solutions and offer methodologies to improve or optimize your existing practices. We believe that together we can tailor your practices to optimize them to better fit your company. The only best practices that really matter are your optimized practices.
We believe that continual improvement, teamwork, innovation, and respect for existing knowledge leads to the most practical and effective practices for your company.
For those of you looking for benchmark best practices, there are some resources available that make a good starting point.
Fast Close to the Max
by Gary Simon (2007)
Available at the FSN Bookstore. Fast Close to the Max provides an excellent high level overview of improvements that can be made to the entire “reporting supply chain” to speed and improve the process.
Some of the key recommendations from Fast Close to the Max
- Banish Bad Data
- Build an effective early warning system
- Leverage the best Technology
- Align the financial organization
- Combine and coordinate available tools
Fast Close
by Steven M Bragg (2005)
Available from Amazon (and other sources)
Fast Close was the first book we could find written about ways of improving and speeding the close. Much of the discussion is tactical in nature. Some of the key suggestions in this book include:
- Common Chart of Accounts
- Common processes across geographic boundaries and groups where possible
- Common ERP
- Common reporting tools
- Simplification of calculations like commissions.
- Move tasks out of the close when possible. (For example, is there any real reason to send customer statements out during the close?)
We are proponents of using the Lean Six Sigma process improvement methodology. An excellent primer in Lean Six Sigma is “What is Lean Six Sigma” by Michael L. George
In our whitepaper A Strategic and Practical Approach to Optimizing Financial Reporting in an Increasingly Dynamic World we also discuss some best practices.
All of these resources can help to give you a good starting point, but for any of them to be truly effective, they need to be brought in and adapted to fit your unique organization.