Unlock the potential of processes and people with automated year-end close

End of financial year (EOFY) is an important, yet often stressful time for businesses. The struggle to finalise all financial reporting, compliance, inventory, budgeting and planning tasks before June 30 puts teams under immense pressure, which increases the chance of errors and ultimately affects efficiency and productivity, says Scott Wiltshire, GM, Oracle NetSuite ANZ.

Embracing automation – not only during year-end close, but all year round – can help businesses complete financial and inventory-related tasks faster, easier and with less stress when tax time rolls around. Further, automation reduces the chances of errors or omissions so that businesses can have confidence in their compliance when approaching EOFY.

Here are some automation ideas to help small businesses increase efficiency every day, week and month of the year.

Give your AR team a break

Manual Accounts Receivable (AR) processes increase the amount of time it takes to invoice a customer, thereby extending the length of time it takes for the business to receive payment.

Some businesses may be tempted to take shortcuts to reduce their billing cycle, but doing so increases the likelihood of errors, leading to lengthy invoice disputes and even later payments. Not to mention that billing errors require high levels of customer service to remedy, placing the AR team under even further pressure.

By automating AR, companies can accelerate cash flow, improve invoice accuracy and reduce data entry time. AR automation opportunities exist at nearly every step of the process, from invoice scheduling to collecting overdue payments. With less time spent on manual, monotonous tasks, AR teams are better equipped to get through tax season with as little stress as possible.

Get out of the way (of accounts payable)

The time-consuming nature of manual Accounts Payable (AP) processes makes it difficult to pay vendors on time, let alone access any early-payment discounts. Processes that prolong the routing and approval of invoices are often to blame for late payments, and while the occasional late payment may be forgiven, consistently paying late can hurt supplier relationships and increase AP workload as vendors continually make contact to follow up on their payment status.

With AP automation, businesses can submit invoices, manage approvals and process payments with swift approvals and gain better control over important financial processes and data. Plus, AP automation reduces the chances of errors or omissions so that businesses can have peace of mind when submitting deductions to the tax office at EOFY.

Speed month (and year!) end close

Closing out the month, quarter or year can be a tedious and time-consuming task, and the more manual the process, the longer it will take and the more likely it is that errors will pop up. It often involves tracking down invoices from the previous month, quarter or year and closing them out. Then, the finance team may need to perform extensive calculations in order to reconcile final figures and prepare end-of-period reports.

An automated financial system automatically performs routine calculations and centralises all invoices in a searchable database to speed up invoice reconciliation and produce reports on demand. When financial processes are automated, businesses can drastically reduce the time spent on month, quarter and year-end close and easily and efficiently complete tax returns without chasing missing files.

Take control of inventory

One of the biggest challenges for retail businesses at end of financial year is effectively managing inventory throughout the bustling EOFY sales period. The goal is to have enough on hand to meet demand without tying up cash in excess stock. Add to this that EOFY is the most common time of year for businesses to perform stocktake, and the demands of inventory management can quickly become overwhelming.

With automated inventory management software, retail businesses can utilise sales data from previous years, along with preferred stocking levels, lead times and reorder points, to optimise their inventory levels and ensure they have the right products on hand to meet customer demand. In addition, automated inventory management tools can help retailers identify slow-moving items and make informed decisions about discounting excess stock to free up cash flow. Lastly, regular automated inventory counts can reduce the pressure to conduct stocktake activities because retailers perform a full physical inventory count without disrupting operations.

Implementing automation can be a game-changer for small businesses, especially for teams that grapple to get everything done during the busy EOFY period. But businesses shouldn’t wait until the end of financial year to embrace automation; the benefits of improved efficiency can be enjoyed all year round.

Want more? Get our newsletter delivered straight to your inbox! Follow Kochie’s Business Builders on Facebook, Twitter, Instagram, and LinkedIn.