Accounting department in any company is a core process responsible for managing the finances of a business. Whether it is about incoming and outgoing cash or financial statements – everything is being managed by the department. Even a small mistake made by the accounting department can lead to huge loss to the company.
Therefore, it is essential for the accounting department to be steady and more aligned with business goals. As a business owner, it is important for you to empower your accountant to meet the key functions of the department.
We have put together some of the best practices to manage your accounting department effectively.
Table of Contents
1. Improve Collaboration Among Departments
How’s your accounting department getting along with other divisions of the firm?
If the answer is “they’re doing ok,” then the possibility is that you’re not focusing on building a synergistic relationship of the accounting team with other departments of the company.
The accounting department cannot function on its own and is often dependent on other divisions for financial data. Moreover, getting the data manually from different departments can be time-consuming.
You need to find ways to ensure that the data is provided on time. Ensuring a smooth flow of data among different departments is one of the key responsibilities of the business owner.
Use cloud-based applications that integrate all the data related to different departments of the company. They can help you improve efficiency and thus, productivity.
2. Conduct Employee Training Whenever Needed
Successful firms regularly evaluate if their staff needs training. It is a good practice to conduct interviews with them to get a better understanding of their day-to-day operations.
For your accounting department to be efficient, it is essential to make sure that they’re proficient. They should be able to adopt any accounting software, or any latest technology being used by the company.
Most of the time, accountants spend a lot of time searching for features or are unaware of some key features that can improve their productivity significantly.
To fill any gaps in learning or skills, it is recommended to conduct regular training programs for them to optimize their performance.
It is not a good idea to have all the skills housed with limited employees. It should, therefore, be shared with the whole team. Cross-training is essential because if any of the accountant or team member is sick or on vacation, another trained employee can cover the gaps. They may receive on-job training or could be sent to external conferences.
3. Automate Manual Processes
With the growing regulatory complexity and increasing client demands, the accounting department is constantly pressured to explore varying strategies to improve productivity and reduce back-office costs. The process of analyzing and measuring finances can be time-consuming and also expensive. As the transaction volumes are increasing exponentially, hiring more employees is not a viable option any longer.
According to a study conducted by the Association of Accountants and Financial Professionals in Business and BlackLine, focusing on manual processes increased the probability of errors and the time spent on financial statements.
In this technological era, the accounting department should be provided with a system which serves to automate the complex tasks. Manual tasks should be reduced as much as possible and replaced by the automated processes.
With the right software solution, automation can help accountants not only mundane tasks such as creating invoices, generating reports but also help them to manage taxes and calculate profit & loss with just a few clicks. Business owners should encourage their accounting staff to find ways to speed up their existing accounting tasks.
4. Maintain Good Communication With Your Team
Good communication is key to business success. Most of the time, employees who aren’t aware of what is expected of them rarely perform to their potential.
Business owners should communicate their expectations upfront so that the accounting department has clarity on things to do. Talk to as many members as possible, from senior CPAs to the junior-most accountants.
It is a good idea to keep the accounting department in the loop about business goals, ongoing projects, and deadlines. Listen to their opinions and encourage their feedback.
You would be surprised to know the kind of insights the accounting department can offer. With a good communication medium and numerous opportunities to provide feedback, the accounting team can express their views and concerns without any hesitation.
5. Leverage The Latest Technologies
For businesses to become successful, it is important for them to build a long and lasting relationship with their clients. In order to do that, businesses must leverage technology to its full potential.
Accountants spend a lot of time doing their tasks manually, such as cash management, data analysis, and reporting. Apart from the possibility of errors, it is also an expensive process in the long run.
Accountants’ role in today’s digital era has evolved. They can now accomplish more in less time, and their role has now become less transactional and more strategic. With today’s technology, small and medium-sized businesses can increase their productivity without spending a lot of money.
For instance, cloud technology is changing the entire digital workflow. With numerous benefits of cloud technology for accountants such as real-time access to data, improved collaboration, and increased flexibility, the accounting process has become more flexible than ever.
According to a survey by Robert Half Management Resources, 41% of chief financial officers (CFOs) stated that staying current with the changing technology is the biggest pressure their accounting department is facing.
Wrapping It Up
The performance of the accounting department should be continuously monitored. These tips would help streamline your accounting department, and you will find a value-adding entity within the firm.
Do you want to learn more about how to make the most of your accounting department? Contact our solutions department at 855-622-8313.