The Essential Controller: An Introduction to What Every Financial Manager Must Know, Second Edition

CHAPTER 8

The Fast Close*

Importance of This Chapter

One of the most common challenges for the controller is to close the month-end books and issue financial statements as fast as possible. The resulting statements are being demanded by corporate management, outside investors, and the Securities and Exchange Commission (for public companies) on the shortest possible timelines. However, the closing process has traditionally been a slow one, with most companies requiring several weeks to close their books and issue financial statements. Companies with more organized closing systems can reduce this process to perhaps one week, while those companies with the best closing processes can reduce the entire interval to just a few days. The wide disparity in closing times shows that this is a rich area of opportunity for the controller.

This chapter walks you through the process of closing the books and creating financial statements faster.

DIFFERENT TYPES OF FAST CLOSE

Several variations on the fast close concept have appeared, causing some confusion about the nature of each one. The fast close is simply an acceleration of the standard closing process, resulting in approximately the same financial reporting package being issued (possibly somewhat stripped down). The focus of this approach is a careful examination of the closing process to strip out wait times, consolidate tasks, eliminate ...