12/25/2023 0 Comments Virtual bookkeeping definition![]() ![]() He also pointed out that a virtual close allows them to change direction and refocus resources quicker. This gives accounting and finance organizations the ability to shape the direction of the organization.” “Maybe you'll be able to predict that earlier based on current, real-time data. “Say Asia has a downturn in their economy,” Andrew said. The real-time data that modern, virtual accounting enables better prepares management to tackle future challenges, manage growth, and even analyze trends by regions. With an impact on customer behavior, supply chains, liquidity, foreign exchange, country-level operations, and business functions, enterprises are still faced with economic uncertainty.įinance and functional leaders are continually adjusting forecasts and assumptions, and require faster access to data to do so. So companies are making decisions based on old data instead of accurate, real-time data.” Building Resilience with Virtual Accounting ![]() He adds that when companies take weeks to close the books, so much time has passed that information may no longer be accurate or relevant. “This is a focus for us with our clients at UHY Consulting.” They can also be confident that things like their sales forecast are accurate (or inaccurate), and they can course correct far more quickly,” says Andrew. “From a business development perspective, they may know when it's time to do inventory-if it’s necessary to increase marketing efforts around a particular product, and make critical decisions in real time. The real-time access to accurate and detailed operating data equips decision makers to achieve sales targets and better manage expenses. How Virtual Accounting Improves Business Agility When your manual processes are automated, your people have more capacity to do value-adding work.Īndrew explains that a true virtual close is when someone can produce a financial statement at any time, so they have the ability to do real-time analysis-and a finance team needs people with the skillset required to perform that analysis. Then you need to look at the underlying processes that are involved, eliminate the non-value, nonessential activities, redesign some process flows, automate, and then, most importantly, continuously evaluate and improve your processes.” The Role Your People Play in a Virtual Close A virtual close means accounting and finance teams can collaborate from anywhere to unify data and processes across disparate systems, with visibility and reporting on all activities.Īndrew defines the virtual close this way: “It’s using technology to produce financial statements at any time, on demand. And it’s caused them to embrace technology and automation that makes their lives easier and equips them to close virtually with confidence.Ī virtual close is the successful monitoring and execution of period-end financial close processes in a distributed environment. It was a challenge to pivot so suddenly to virtual work, but it also helped accountants (who have been resistant to change) realize that they are capable of changing the way they work. With the right technology, companies can do the same activities that they were performing in person, but now virtually.” Defining the Virtual Closeĭuring a recent Genpact webinar, 70% of participants said that COVID-19 has had a positive impact on their financial close process. ![]() And companies operating with antiquated systems that were very manual in nature had a much more difficult time becoming virtual, but many have been forced to adopt new accounting automation technologies and undergo some sort of finance transformation.”Īndrew adds, “Leadership needed something that gave them the comfort, visibility, and controls they had back when they were able to walk to somebody's desk, get a signature on something, and be comfortable that the right person had reviewed it. Regarding the impact the COVID-19 pandemic has had on virtual accounting, Andrew Borsuk, Principal at UHY Consulting says, “At the start of the pandemic, I think a lot of companies were doubting whether they were going to be able to pull off working with a distributed workforce. Virtual accounting reduces travel expenses and commuting time, and it can boost productivity with less interruptions. It’s also scalable and sustainable-unlike the traditional, manual processes that have long challenged accounting teams and bound them to working in a corporate office five days a week. This modern way of working is more flexible, efficient, and cost-effective. Virtual accounting is achieved when your accounting and finance teams have the technology they need to perform all their activities and tasks virtually, without needing to be physically present in the office. ![]()
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