Change management, automation and new digital tools transform finance operations for educational services company

The organisation partnered with Protiviti to increase efficiency within its financial close process and implement other record-to-report improvements. By replacing its manual processes and legacy systems with agile tools and solutions, the organisation could automate journal and account reconciliations, controls and reports that were being manually produced in Excel. This would help the company reduce errors and decrease operating expenses while allowing more time for accounting staff by leveraging existing tools and watching for new opportunities to automate finance and accounting processes. Deep dives into accounts payables, prepaids and fixed asset accounting processes would help identify, prioritise and remediate errors and manual intervention.

Evaluating manual processes for transformation opportunities

Many of the company’s foundational practices were being manually completed, including accounting accruals and ingesting outside data so the finance team could complete monthly and quarterly financial close processes. Excel spreadsheets were used to prepare periodic journal entries, reclassify incorrectly system-generated transactions and correct errors, introducing the possibility of deficiencies and other risks. After a thorough review, it was evident that many of the organisation’s manual finance and accounting processes could and should be automated, while others could be standardised, simplified, consolidated or even eliminated. Roughly 500 manual reclassification journal entries were evaluated over a seven-month period, with at least half of those identified for elimination or automated through process enhancements.

Analysing the existing technology stack

To enable improvement in workforce practices, the variety of software applications used by the firm needed to be optimised. The organisation’s technology stack was analysed to determine an optimal digital architecture for finance with the organisation’s process and controls requirements in mind. Based on this analysis, technology tools were recommended that would provide the best fit-for-purpose technology architecture for where the organisation is today as well as for where its journey map would go next from a size-complexity standpoint.

The company used a common ERP platform, but its accounting close-out tool wasn’t robust enough. The existing technology tool still required numerous manual inputs and lacked the ability to directly integrate with various data sources. It needed a tool that was sophisticated enough to handle the complexity of the organisation’s financial environment. Protiviti reviewed several vendor options for the organisation to select a technology that would be a better fit for its use cases, including the redesigned processes, controls and reporting. After reviewing several vendor options, BlackLine, a cloud-based platform, was implemented to provide the organisation with much greater functionality. Four specific Blackline modules were introduced to help with the organisation’s financial close calendar automation and dashboarding, reconciliations, high-volume data matching and automation of journal entries.

These new digital tools and targeted modules provided the organisation with improved functionality by automating financial close and reconciliations. The high-volume matching module ingests daily data directly from financial institutions and retrieves data from other sources, matching that external-source data with data from the company’s own administration system in its general ledger. This enables two-way, three-way and even four-way daily matches to validate information and reconcile the transaction values in the general ledger to the company’s source, such as a bank or other third-party entity.

In the organisation’s payroll system, data extractions from Workday, a financial and human capital management platform, were automated, validated against the ERP cost and chart of account structure, and integrated with the organisation’s accounts payable function in its ERP system. Manual intervention points were eliminated, optimising the overall process. This enabled existing systems to communicate and interface with each other, improving data flow and business processes.

Embracing change and owning it

The changes brought about by the updated technology enabled the company to transform the way its team worked. But change can be difficult, particularly for long-tenured employees who were not ready to change their daily processes. By applying change management methodologies, employees were encouraged and enabled to embrace and become part of the change – and to be recognised and rewarded for being part of the change environment. Automation and more robust technology would enable the team to do higher-level tasks such as analysis, rather than spending time on manually processing data, correcting system-driven errors and preparing reports. The ability – and time – to analyse the data enabled them to provide data-driven decisions in a more timely manner so that key leadership could react accordingly in alignment with their overall business strategy.

With full support of the leadership team, championed by the organisation’s new chief accounting officer (CAO), the organisation was able to find the best business case and set the tone for the rest of the organisation to collaborate and be empowered, and to focus on the value and benefits brought by the transformation in the form of more robust controls, better reporting, and measurable ROI.