Page 250 - Accounting Best Practices

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12–15 Convert Serial Activities to Parallel Ones
for permission to repeatedly train their employees. However, these issues are
minor ones, given the benefits of reduced transaction error rates.
Cost: Installation time:
12–14 CONTINUALLY REVIEW WAIT TIMES

A lengthy financial statement completion process has a number of spots built into
it where there are long wait times. For example, the typical company waits five
days before it receives a bank statement from the bank for each of its accounts
necessary to complete a bank statement. Also, there is usually a wait of a few
days while supplier invoices arrive, just to make sure that all expenses have been
properly recorded. It is pauses like these that make it nearly impossible to issue
financial statements in a rapid manner, no matter how quickly all other tasks are
completed. For example, it may be possible to blaze through a bank reconcilia-
tion in an hour, but if one is still waiting five days to receive the bank statement,
one is focusing on the speed of the wrong activity.
The best practice that helps to resolve this issue is a continual review of wait
times. This focuses attention on those activities a controller should really be
attempting to reduce in size or eliminate. To review wait times, the best tool is a
Gantt chart. This shows the typical start and stop dates for each closing activity.
By closely examining the start dates for each activity and questioning why those
dates cannot be accelerated, it brings attention to bear on any activities that are
dependent on the prior completion of other activities. However, this is only a tool
for pointing out where there are problems; it does not actually resolve them. To
use the example from earlier in this section, a Gantt chart will only tell a con-
troller that there is a substantial wait involved before all supplier invoices are
received—the controller must still do something about it (that particular item is
addressed in the ‘‘Automate the Cutoff” section earlier in this chapter).
There are no problems with using this best practice, for it is easily imple-
mented, requiring only a brief review by the controller after each financial state-
ment closing to determine if there have been any wait-time changes. It also needs
no programming and does not involve other departments. In short, it is a simple
best practice to install and provides valuable information for the targeting of fur-
ther improvements.
Cost: Installation time:

12–15 CONVERT SERIAL ACTIVITIES TO PARALLEL ONES

A common problem, especially in smaller accounting departments, is that a con-
siderable amount of wait time is built into the process because there are too many