The efficiency of the accounting department will always have an immense impact on the running of a business. As a business owner or upper-level manager, it’s important to continually encourage and support the finance team in doing their best in running the business’s finances.
In the event that your team requires external assistance, Indinero’s fractional CFO service is the place to go. But in the meantime, below are a few tips proven to boost the efficiency of your business’s accounting department:
1. Staff Training
Before doing anything else on this list, you need to ensure that your accounting department is qualified. They need to adapt to new financial procedures and be able to understand the comprehensive training that’ll follow any changes made to the accounting software your business decides to buy.
There are multiple ways to train your staff, including:
- In-house seminars
- One-on-one training
- External conferences
There’s nothing worse than having a finance team that’s only good at one thing and horrible at the rest. What’s needed is a team with diverse skills where some can keep up with current tax laws and others conversant with new reconciliation software.
Cross-training should also be considered. There should be one primary person in charge of certain tasks and a second individual who’s proficient in those in case the former becomes sick or goes on vacation. The business shouldn’t be crippled by the absence of an individual.
2. Strict Deadline Polices
Second, your accounting department will need to set in place strict deadline/cutoff policies. It’s a common situation in businesses where the accounting team can’t conduct their work properly because other departments don’t submit their various documentation (invoices and adjustments) on time.
On a regular basis, revisit these policies and assess their effectiveness and what needs to be done to improve them.
3. Pay Attention To Reconciliation
It’s best to specify dates in each month when your staff or a certain individual is to focus on batch processing and reconciliation. It isn’t feasible to process every invoice or request as it shows up. The rest of the departments in the business should be made aware of these dates so as to avoid having to process lone checks or emergency reimbursements due to poor planning.
4. Have A Central Online Database
Using cloud software allows for easy access to relevant information from any location. There are situations when departments may not be separated by walls but by cities or countries. Remote access to information must be available in such situations.
Invoices and reconciliations can easily be submitted from these locations. This has become increasingly important after experiencing the COVID-19 pandemic.
5. Automation Of Your Processes
It’s recognized that there’s room for decision-making and real creativity in the accounting department. However, it must also be recognized that there are various areas of accounting that computers are capable of executing.
It all lies in selecting the right software solution for your business. Once selected, the software can automate all the mundane processes your department dreads doing. There’s the added benefit of removing paper from the process and operating purely digitally. This may sound more complicated than it is when in reality, switching to automation of certain processes will free up your staff to focus on the tasks that require a little more brain power.
Because the risk of human error plummets in the face of automation, issues like double-entry cease to be a concern when all relevant systems are linked to the software system.
Commonly automated tasks in accounting include the following:
- Expense management
- Bank reconciliation
- Accounts receivable
- Accounts payable
- Tax compliance and financial reporting
It’s crucial to resist the urge to try and bypass the system and crunch numbers again in Excel. It won’t be a walk in the park getting used to the system and tailoring specifically to your business’s needs, but it’s worth it in the long run.
Usually, the providers of the software conduct comprehensive training for the employees chiefly responsible for handling the software. After some time, just like with your deadline policies, you need to assess the functionality of the software you’ve chosen. Has it improved efficiency? On what scale? These are important questions to ask.
6. Communication Is Key
It’s wise to have open channels of communication not just within departments but between departments as well. When you clearly communicate your expectations to your finance team and they know what’s required of them, more often than not, the feedback will be extremely helpful in streamlining processes.
It’s important to adapt to the age we’re living in. The level of innovation the business landscape is surrounded by should push all areas of a business to evolve alongside the landscape, and the accounting department is no exception to this. Hopefully, these tips will revitalize your department and help it increase the efficiency of your overall business operations.