Clive Jefferies

On-demand webinar series: Roadmap to Journal Entry Process Excellence

Welcome to the Manual Journal Entry Process Excellence webinar series. In three episodes we aim to cover key steps in achieving highly efficient and compliant journal entry process.

Episode 1: Journal Entry Automation

What are the repetitive manual tasks within the journal entry process?

Managing journals from your ERP system and Excel results in many repetitive manual tasks, which in turn makes the process prone to data entry errors. The tasks that claim the most unnecessary time and are capable of being streamlined with intelligent automation are:
  • Journal creation in spreadsheets (as opposed to pre-defined templates)
  • Manually uploading and posting journals to the ERP system
  • Manual journal reversals
  • Manually redoing recurring journals
  • Complex journals like provisions, allocations and accruals
  • Printing journals along with supporting evidence for approvals and archiving them in binders

All of these tasks drain valuable time and energy from your team that could be spent on more value-adding activities. In addition, the data entry errors require even more time and hassle to go back and correct after the fact. Bear in mind that what these repetitive tasks are costing you may not be immediately apparent if the costs are hiding behind salaries. Consider how much time is spent on each journal entry and how much of your department’s budget is spent on salaries for this time.

Episode 2: Journal Entry Process Management & Compliance

What are the challenges of journal entry compliance?

Without the capability to enforce specific rules, how will you know if they are even being followed? It can hurt your department’s efficiency if it takes more effort than it should verify compliance with corporate policies. This could also make it harder to prevent and detect material misstatements and fraud. But the stakes are even higher if you are subject to stock exchange rules and regulations governing journal entries. And if you aren’t listed today, what if you become listed in the near future?
Some of the key rule types that are difficult to enforce without centralised compliance functionality include:

  • Segregation of duty rules
  • Journal approval rules
  • Supporting evidence rules
  • Journal data protection rules
  • Audit trail rules

For example, how do you prevent the same person from creating, posting and approving a journal in practice? How will you know whether approval rules based on journal value are followed? And how do you make sure the supporting evidence is always there and correct?

Episode 3: Connected Journal Entry & Financial Close Process

What are the challenges of a disconnected journal entry and financial close process?

Timing is critical in the financial close process and having to switch between different applications, interfaces and windows make the whole process take more time. Some of the factors that really add to the complexity problem are:
  • The lack of automatic linking of closing tasks and related journal entries
  • The inability to create a journal directly from closing tasks
  • The inability to journal away an incorrect reconciliation on the spot
  • The inability to reconcile accounts by linking them back to the journals, which have related supporting evidence and approvals

You are in double complexity trouble if your integration between closing task systems and the journal management system is not live. Batch upload integrations may require your team to switch between programs, even more, to force a manual update when time is of the essence or to check when the data has flowed through to the other systems. When it comes to the size of your company’s system architecture, in other words, how many different systems your company uses for journal entry and financial close management, the bigger they are, the harder they fall.