The accountant is a key player in any business - after all, bad money management often equates to why businesses will fail in their first three to five years.
Unfortunately, the accounting department including Accounts Payable and Accounts Receiving, is one of the most singularly complex branches of any business, as well. Rife with complicated and interdependent processes, as well as various stages of involvement and approval from other departments and managers, it's easy to see how accounting can be bogged down.
This issue should ALWAYS be addressed - remember, your financial department is what helps you get the money your business deserves for the hard work and quality service or product provided!
Why hinder them by arguing about "cost v. value" on the new project they want to engage in to improve their department?
Here are five proven ways to make your accounting department more efficient:
1. Create deadline/cutoff policies, and adhere to them strictly.
Waiting on employees is one of the single largest time wasters for an accounting department, especially considering that most accounting teams have strict guidelines in place for the rest of the business to follow regarding submitting invoices and adjustments.
Once these policies are in place, start considering whether they are working or not, and whether they could work better.
Make frequent announcements if it is a chronic issue throughout the organization, or go to executive management about repeat offenders in specific departments, before this becomes a problem that management has with accounting for "not hitting their deadlines".
2. Batch processing saves time... and lives.
Don't process every check request or invoice or reimbursement request as it comes in. Decide on a certain time of month, typically two or three specific dates, that you will process these.
Make sure to give these dates to anyone who might request a check from you - having this knowledge as available as possible to the rest of the company prevents as many "emergency" checks and reimbursements.
3. You have a complex and highly functional accounting program - use it!
Ok, so maybe you don't have the top of the line "basically does it for you" program in place, but chances are you have some kind of electronic bookkeeping in place at your organization.
Resist the urge, however strong it may be, to crunch numbers outside of this system. Even if it seems like to get the system to do what you want would take months, look into getting a trainer for the software to instruct on how to do it, or on outsourcing somebody to program the functionality. It will save you literally days and hours of time in the long run.
Review the functionality that your accounting system provided, or promised to provide, during the initial purchasing phase - has it delivered? Talk to your representative and figure out how to make that the case.
4. Conduct process walk-throughs
As an accounting manager, or even an accounts payable clerk (for example), you may have the ability to view the process internally, and see what the perfect world will look like if everyone just followed the rules.
From the other departments of your organization, however, it can often seem like these steps are a waste of time, or that they are unnecessary to the overall process.
The real issue? It's entirely possible they could be right!
Process, left without maintenance, often evolve into strange workflows of great ideas with terrible execution. Walk through the process itself from start to finish, as though you were a customer or other department member, at least annually.
An Annual Process Review can provide great insight into the weak points of a business or department, especially if you invite a process expert or consultant to participate who can view things objectively through the lens of process improvement through the company as a whole.
5. Stop wasting time on tasks that a computer can do.
There are a lot of things about accounting that require real ingenuity and decision making.
Realistically, however, there are also parts of an accounting department that computers are VERY good at. After all, we did stop using the abacus in favor of the calculator.
With the right software solution, an accounting department can allow their computers to not only automate mundane processes like routing or decision based form control, but remove paper forms from the purchase request or invoicing process entirely with electronic forms and document management.
That might sound complicated - it's really not. Think of your current process in a perfect world, and then try to visualize the parts that a computer might do for you. A computer has a very easy time enforcing rules with zero exception, so mistakes won't be made on the approval process, and who should be making what decisions.
Likewise, double-entry ceases to be a concern when systems are linked together through the document management system - simple no-coding integration with existing accounting department software should be a standard feature.
Want to learn more about how Accounting Automation can make your accounting department more efficient? Check out these 5 Accounting Tasks You Should Be Automating.