Are You Ready to Automate Your Reconciliation Process?

By Robert Half June 30, 2017 at 6:00am

Automated reconciliation of your bank accounts can take one of the most time-consuming tasks in any finance and accounting department and make it faster.

But that doesn't mean everyone is doing it that way. The number of U.S. teams reconciling accounts manually is still more than half (58 percent), according to Robert Half's latest Benchmarking the Accounting and Finance Function report.

Financial professionals sticking to the tried-and-tested methods say their budgets don't stretch to buy new systems. They’re uncertain about whether existing software can meet their current needs. Their CFOs worry that training requirements will actually increase the amount of time it takes to reconcile over the first year.

The concerns are valid. Each company has different needs, so every CFO must consider whether the benefits of automation outweigh the costs. If you’re thinking of moving toward the automated reconciliation process, here are three basic steps to follow.

1. Assess your current needs and capabilities

Start by building a complete user story for the finance team of how reconciliation is handled, so you can identify where automation may help. You may immediately see parts of your workflow that could be made more efficient, such as processes with multiple hand-offs. You may also decide that certain operations, such as the financial close, are too complex to automate, and that a human eye is always needed there. But analysis can often identify ways of streamlining those operations.

2. Evaluate the available software options

There is no one-size-fits-all business accounting software. The overall percentage of respondents who use an on-premises enterprise resource planning (ERP) system as their primary financial system has held steady, the Benchmarking report shows.

What's new is that more than half (51 percent) of the executives said they've made the transition to cloud-based accounting, compared with 42 percent using cloud-based software in 2016 and just 24 percent the year before that.

Twenty-one percent of this year’s respondents said they plan to upgrade to the cloud in the future.

3. Support staff during the rollout of new systems

Training is a major concern for many CFOs when considering automation. Your skilled staff may know already how to work the manual process. But what will happen when they switch to a new process? For example, if users don’t feel confident with a new system, they may not use its full capabilities.

To address these concerns, make sure you offer accounting job training and support for all your team members so they can get familiar with the new system. And consider a phased rollout, if possible. It allows a selected segment of staff to learn the new system first, then use their experience to help others.

It seems inevitable that reconciliation work will eventually all be automated. Companies that still reconcile manually need to start planning for change if they're going to stay competitive.

Editor's note: This post was recently updated with data from the 2017 report.

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