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Periodic closure – The key for control

Today, companies management is expecting that the financial departments is contributing with up fresh data to support decisions and with a good overview over regulations.

If your answer is “no” to one or more of the questions below, you should continue reading to see how an effective and correct periodic closure can help your business:

•    Do the financial functions deliver what they are supposed to, in an effective manner and at desired cost?

•    Is reporting done in an appropriate manner?

•    Is your company focusing on the appropriate management parameters?

•    Does your company have the right competencies and capacities?

Experience shows that solid routines tied to an effective periodic closure gives:

•    Improved reporting and basis for analyses

•    Correct KPI’s and measurements

•    Improved budget and forecasting, and follow-ups

•    Effective transaction processes

•    Effective operation and organization of the financial function

•    More competent and content employees

An example of a periodic/monthly closure checklist with the use of Dynamics AX can be:

Date

Task/Description

Responsible

T-2

Open next period

 

T

Make sure that all delivered orders are invoiced (Status Sold)

 

T

Make sure that all received orders are posted (Status Purchased)

 

T

Updated exchange rated

 

T

Control and check all open finance/inventory journals etc.

 

T

Update fixed assets balance sheet

 

T+1

Carry out bank reconciliation

 

T+1

Draw balance list distributed by age, customers

 

T+2

Send out account statements/reminders to customers

 

T+2

Make sure that all costs of labor are issued and posted

 

T+2

Draw balance list distributed by age, suppliers

 

T+2

Carry out inventory/warehouse closing procedure

 

T+2

Post turnover

 

T+3

Close period

 

T+3

Draw trial balance

 

T+3

Draw profit and loss statement, balance report and division balance sheet

 

T+3

Draw stock value report and stock reconciliation

 

T+3

Draw cash flow forecasting and currency needs for the next period

 

T+3

Draw VAT-report, and report to authority

 

T+5

Report to management

 

(T = the first day in the next period)

This checklist will give your organization:

  • More effective periodic closure and reporting
  • Determined management and financial reporting
  • Effective budgeting, estimation and reporting
  • Improvement of structure and efficiency in the financial function
  • “Shared Service Center” and merger of financial functions possible

I appreciate that I can be a part of this worldwide blog community—as a consultant working from Norway, the blog lets me share more than 20 years of experience with Microsoft Dynamics 365. Along the way, I participated in developing retail, PDA/RF, barcoding, master data, kitting and WMS-solutions for Dynamics. My blog focuses on my deepest interests and expertise: along with a 360 degree view of digital transformation topics, I welcome opportunities to dive into retail and intercompany supply chain automation, logistics, and production—everything that is moving around in a truly connected enterprise. As Enterprise Architect on Dynamics 365, I specialize in strategic development and planning for corporate vertical solutions and works to build international networks that increase knowledge and understanding for Dynamics 365. As an advocate for both providers and customers, I'm committed to ensure that customers constantly changing needs are meet, and I see community as key for increasing expertise. I welcome you to connect with me.

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