Technology Transforms Non-Profit’s Financial Processes

Assessing the finance function

The client’s Chief Financial Officer (CFO) was seeking a partner to assist in the holistic transformation of its finance function to enable more timely and routine visibility into the organization’s financial performance.

To determine existing gaps and challenges to be addressed, Protiviti initially performed an assessment of the client’s current state based on the six elements of infrastructure:

• Business policies
• Business processes
• Organization and people
• Management reporting
• Methodologies and assumptions
• Systems and data

The assessment identified inconsistencies and lack of standardization in global finance and accounting processes across business units, which were reliant upon highly manual efforts. The finance team was mainly focused on data aggregation, migrating and reconciling necessary data from various disparate systems due to lack of system integration and suboptimal use of technology and automation features. The company also lacked a formal monthly close and financial reporting process, resulting in limited visibility into consolidated financial performance and extended audit timelines. From an organizational perspective, resources were overleveraged, lacking strategic focus and willingness to change existing processes.

Based on the assessment results, we expanded our partnership to include the Chief Technology Officer (CTO) and worked together with the CFO, Controller, and CTO to develop a roadmap that would enhance the existing infrastructure to enable a sustainable, structured, and more efficient end-to-end financial close process. This would allow the client to achieve:

• Formalization and standardization of routine financial close processes to allow for a shift focus to more strategic financial analyses in support of critical business decisions.
• Increased compliance within an accelerated cycle time shifting to a routine monthly end-to-end close and reporting process.
• More agile and standardized reporting with insightful variance analyses.
• Positive impact to the bottom line via sustainable automation and process stabilization and improved use of current tools such as NetSuite.

Automation transforms the monthly close process

To meet the client’s goals, we provided formal recommendations and worked in partnership with the client to:

• Integrate key systems and automate business processes by advising in the selection of an integration application platform to streamline integration efforts. Protiviti collaborated with the client to define business requirements and interface configurations, supporting the systems’ design, development, and testing. The client ultimately selected Boomi as its integration platform of choice based on its ability to satisfy integration requirements, flexible ease of use and availability of training materials/resources.
• Automate grant reporting by championing implementation of the grant management module within the existing ERP to streamline the grant lifecycle, significantly enhancing visibility of financial information and driving more accurate and timely revenue recognition, as well as more informed business decisions.
• Formalize and standardize the close process, developing a comprehensive close checklist to drive accountability and consistency and highlight cross-department dependencies. Through ongoing observation of the close process, persistent delays and bottlenecks were quickly identified, enabling the implementation of targeted remediation plans including the establishment of materiality thresholds to streamline monthly close efforts and formalizing account reconciliation processes and templates.
• Drive change management efforts across the organization to overcome inherent resistance to change through regular creative communications informing of progress towards achievement of transformation goals and cultivating a more positive culture embracing change.
• Provide project oversight and management, facilitating a smooth and adequately governed transformation process.

Embracing change

By optimizing the use of technology and formalizing key accounting and financial reporting processes, the company was able to transform how finance works through automation and standardization of the monthly close process. The value added through this transformation included:

• Greater capacity of the finance organization to increase business partnerships and shift focus to preparing more analytical decision support.
• Improved efficiencies and visibility of consolidated financial results on a monthly cadence, allowing for more timely action on identified risks and opportunities, as well as a more expedited annual audit process.
• Improved scalability and agility across the organization due to efficiencies achieved and availability of financial data on a unified platform, enabling more timely and insightful analytics to support informed business decisions.
• Strengthened internal controls and governance environment through formally documented policies, methodologies, and reviews which may reduce the risk of material misstatements.
• Improved processes and efficiencies achieved provided a basis for optimizing the finance and accounting target operating model to drive future cost reduction opportunities.

While these changes enabled the finance organization to transform, the changes were initially difficult to embrace, particularly for the long-tenured employees ingrained in their current processes. However, by applying unique and creative change management techniques, including a monthly transformation newsletter providing transparency into the program, these employees were encouraged to embrace the change and shift their focus to assisting business partners in developing financially sound strategies to achieve the company’s long-term goals.