Year end is never easy, there is a huge amount to do, with many people involved and pressure from a wide range of stakeholders. But for some companies, year end is a hellish marathon of late nights, unrelenting challenges and never ending corrections. There are a number of factors that can cause year end pain, here I list my top 7.
Of course, the most pressing issue and often the biggest pain. The data you have available is incorrect and often it is not clear why. This requires a lot of time unpicking the data and resolving the issues. Worse still, there is a chance you don’t realise the data is wrong and reports are shared internally or external with the wrong figures!
2.Lack of visibility and auditability of data
Year end visibility is incredibly important. It is the most critical part of the year for providing a range of stakeholders with clear assurance that the numbers on review are accurate and justifiable. Your shareholders will want as much detail as possible to feel positive about their investment and external auditors will expect extensive information to ensure you are up to standard. If your data lacks this visibility and auditability naturally, there will be a requirement to spend a lot of time gathering this information and generating reports to display this information.
3.Lack of consistency of definitions
“Oh, we stick that in overheads”. “What?! We’ve always put it in Cost of Sale?!”. Ah. If your business operates across multiple sites, entities, countries, regions (planets?), then there is always a risk that different parts of the business will define the same transactions in a different way. This ensures you won’t be able to consistently compare the business across markets or possibly across years.
4.Lack of control
There are bespoke systems and spreadsheets everywhere - different spreadsheets and different versions of the same spreadsheets. In some cases, there are hidden formulas written in the 1990s (now 3 decades ago) which are making the numbers do something impossible to understand. There are any number of different systems across many different countries in multiple different languages and trying to make heads or tails of it takes longer then actually analysing the numbers.
5.Lack of understanding
You’re only as strong as your weakest cog…And in larger organisations there will be many cogs. Even with the best intentions and the best training, there are still going to be parts of the business which do not have as much understanding as you’d hope. High turnover (not in the revenue sense) exacerbates this, as do language barriers and levels of technical knowledge. The consequence being that a lot of your time is spent handholding users through the inherent system processes, with varying degrees of success.
Whether it’s a spinning wheel of death on a corporate system or the white haze that’s enveloped your Excel spreadsheet (“Excel is not responding, would you like to restart?”), there are fewer more acute feelings of dread then watching the system trudge right at the moment you need a quick answer. This can also be coupled up with data not being available for long periods if you are reliant on the system to “refresh” for several hours.
7.Time consuming to produce reports
Data can be split across different spreadsheets or systems and requires time to aggregate it all together. Alternatively, or additionally, data quality isn’t always there and a number of top-on adjustments need to be made, just to meet external reporting requirements. On top of that, if your data isn’t available in an easy to access form (e.g. a database) then every time a new report is needed it requires a number of hours of manual effort.
What can I do?
Scream! If in an appropriate location, that can help. However, I’m sure many of you are coming out of your year end never wanting to go through another one like it again. The time, effort and cost of a painful year end can be substantial, and it certainly doesn’t help with attrition. The most important step is to take the time to review your year end process, assess what is causing the most pain and come up with a plan to tackle it. Consider taking the most challenging parts and implementing solutions to automate or significantly simplify them.
Begin this process by taking a minute to walk through there below link. Here, at Fidenda, we would like to help steer you away from these experiences in the future.
Never go through a Year End like that again.