Five strategies based on experience
Sponsored by SkyStem
Credit unions everywhere are seeing an uptick in asset size. From 2020 to 2021, credit union membership increased by 23%. Whether through acquisitions, mergers or organic growth, this means a larger burden for the accounting team, specifically more reconciliations and month-end tasks. In the accounting world, “lean and mean” rings true for many teams. With this added volume, how can your accounting team keep up? Here are our five best tips for how to stay on top of your credit union’s month-end close.
1. Standardize everything
If five staff accountants are doing reconciliations, you’ll get back five different forms. Implementing standardization will minimize error and ensure each reconciliation is easy to understand and review. Another part of the month-end close that should be standardized is your close checklist. It’s always a challenge to define a clear order of operations for any process; doing so will take a bit of extra work up front. However, the payoff will be worth it the next time you close.
2. Maintain organization
Balance sheet general ledger accounts need to be reconciled in a timely manner or there’s going to be trouble. If compounding interest is the eighth wonder of the world, compounding reconciliations might be one of the eight nightmares. A late close one month might even eat into the next month’s activities. Accounting teams should prioritize figuring out a system that suits their unique needs. Part of a great organization strategy includes communication among everyone involved. No one should feel like they don’t know where each important piece of documentation is stored.
Organization is also important when it comes to open items and aging. It’s easy for something to slip through the cracks when it isn’t right in your line of sight, or when it has been misplaced. If your conference room looks like a reconciliation war zone with spreadsheets scattered everywhere, it’s time to find a new strategy.
With remote work becoming increasingly prevalent, resources need to be readily available for anyone who touches the close. This includes auditors, who aren’t going to be happy if the document trail isn’t captured. Moving your binders online isn’t only for remote teams. There are many benefits to going digital, including reduced storage costs, faster retrieval and an easier way of enforcing compliance.
4. Take a breather
Especially during the month-end close, accounting teams have more than enough on their plates. When you feel your eyes start to read the same line over and over, it’s time to put down the journal entry and go for a walk around the block. Human error is unavoidable, but a lot of it is preventable. While it may seem counterintuitive to pause work to get more work done, a rested mind will make fewer mistakes—and save time and money in the long run.
5. Consider automation
Adopting software to streamline the month-end close can bring the value of saved time and fewer mistakes, plus the added sanity restored to an overworked accounting team. Automating what you can in order to free up more time for high-value work will realize ROI fast. Automation is one of the main ways small teams can relieve the burden of a heavy workload. Repetitive processes are a perfect target for software to take over, as rules can easily be toggled. When the month-end close and reconciliation process is streamlined, accountants can focus more on analysis, investigate what can be done differently and use the insight to make strategic decisions.
If your credit union continues to grow while your accounting team stays the same size, it’s paramount to do what you can to stay afloat during the demanding month-end close process. Following these tips will better equip your back-office team to do the work necessary to continue to provide outstanding service to your members.
Ally Mason is a marketing specialist at SkyStem, a month-end close SaaS product for accounting teams. Their flagship solution, ART, can eliminate up to 90% of manual month-end activities by leveraging automation, dashboarding and reporting. ART helps accounting teams win back more of their time and was able to reduce KEMBA Financial Credit Union’s reconciliation time by 50%. Want to see what ART can do for you? Book a demo today!