Month-End Closing Taking Too Long? Here's Why

An effective month-end close should be complete in six business days or less. But the reality is that only 53% of companies are able to close in that timeframe.  

The other half are taking much longer, meaning their accounting departments spend weeks manually reconciling statements, doing flux analysis, and other time-consuming tasks.  

This timeframe can get even longer when there’s not enough bandwidth on the team—a challenge most companies today are familiar with due to the shortage of accounting talent.  

These delays make the month-end close a nightmare for controllers, who are trying to juggle competing business priorities, ensure accurate financials, and maintain team morale.

Let’s take a closer look at the root causes of delays in the monthly close process.

Siloed data

Here’s another scenario you might recognize: You have five different spreadsheets open on one screen, a bank statement on the other, and you still can’t find the data you need. So, you email a colleague asking for the data, and they send you yet another spreadsheet.  

When you have different versions of financial data across spreadsheets and systems, it's almost impossible to ensure accuracy. This slows down your close, and for controllers, it leads to a lack of control and oversight of the process.  

And if that’s not stressful enough, disorganized data and documentation also causes headaches during audits as your team wastes time trying to track down the information auditors need.  

Manual processes

Another challenge of this process is that accounting teams are spending a lot of time entering data manually. This is not only a poor use of their time and skills, but it also leads to inevitable manual errors that take additional time to address.  

A reliance on spreadsheets creates inefficiencies and delays that get in the way of completing the close in six days or less.  

Lack of standardized workflows

Creating a standardized workflow for your month-end close might sound like yet another time-consuming task to add to your to-do list.  

But think about how much time you waste tracking down information from other departments, like accounts payable and accounts receivable, to finalize reconciliations. Or think about how much time passes as you wait for a response when roles and responsibilities are unclear.  

Inconsistent workflows lead to errors and delays that add up to an unnecessarily long close timeline. A new process may take time to implement, but once it’s in place, your monthly close will go a lot smoother, saving your team days of work each month.

Inadequate tech stack

If there’s one culprit for all the challenges we just discussed, it’s an outdated tech stack.  

Relying on a combination of spreadsheets, your enterprise resource planning platform (ERP), close software that forces you to look outside your ERP, emails, and sticky notes on your desk will never lead to a better process.  

Outdated and disjointed systems create data silos, require a lot of manual data entry, and get in the way of efficient processes.  

This is why controllers often feel like they’re in "firefighting mode," spending a lot of their time trying to identify and resolve bottlenecks.  

The lack of a centralized place for your process means you don’t have a real-time view of the progress to help you understand what you need to unblock to move things along.  

 Month-End Closing Taking Too Long? Here's Why