Steps for effective cloud finance operations practices

The cloud has made accounting faster, cheaper and easier for firms of all sizes. From up-to-the-second information to lightning-fast modelling and iterating, the opportunities are abundant for accountants moving “to the cloud.” Those who think about cloud accounting as a strategic shift, rather than just moving their books to the internet, will achieve faster close cycles, better forecasting and time freed up to conduct higher value analysis. This post details particular, actionable tactics your finance team can start using to see real results with cloud accounting now.

Begin with a vision and goals that are clear and measurable

Start by laying out the reasons why you would want to move to cloud accounting. Typical objectives are accelerated month-end closes, enhanced cash forecasting, minimized manual data entry and better controls. Translate those goals into specific targets: to decrease the time it takes to close by X days, to reduce costs associated with processing invoices by Y percent or to have Z percent of repetitive process automation. An objectives-guided process ensures that choices are based on business results and not feature lists when it comes to systems, integrations, and practices.

Standardize processes before migration

One common trap is transferring inefficient legacy processes to the cloud. Before you transfer data and workflows, map your current accounting processes and uncover inefficiencies. Implement accounting best practices like a uniform chart of accounts, month-end close procedures documented, and standardized transaction coding. Standardizing things gets in the way of complexity around cutover, is a more straightforward thing to script once you're there and live.

Prioritize data quality and governance

Trusting the Data: Accurate, trusty data underpins successful cloud finance. Purify master data such as vendor IDs, customer names belts and account mappings prior to migration. Enforce data governance that dictates ownership, retention, and approval rules. Put in place controls on important transactions such as invoice validation, and tally the ledgers through migration. Good governance reduces the number of post-migration surprises and makes sure that reports represent the same truth organization wide.

Design around business requirements

Cloud accounting is most effective when it’s the single source of financial data. Integrate systems that feed your company’s financial operations — payroll, procurement, sales and banking — through well-defined interfaces. Integrate with plans for real-time or near-real-time data flow where the rubber hits the road, such as bank reconciliation and revenue recognition. Intelligent systems integration also minimizes manual re-keying, streamlines the reporting process and allows for more timely decision making.”

Automate and minimize manual involvement

Cloud accounting is one of the best levers we'll ever see for scaling efficiency and automation. Spot repeated processes such as invoice capture and matching, recurring journal entries, bank reconciliation for automation. Then work on high-volume, high-effort processes to generate some quick wins. By enabling workflow automation and rules-based processing to the process, execution becomes faster while minimizing human error.Developing more accurate financial data.

Improve Data Security and Access Protection

Shifting financial data to the cloud demands a re-engagement with data security. Set role-based access controls so that users only see what they need to do their work. Use multi-factor authentication and logging for changes and access. Encrypt at rest and in transit Data ensure you have backup/recovery plans that enable you to meet recovery time objectives (RTOs) and recovery point objectives (RPO). Conduct frequent access and permission audits to ensure controls stay current with changing responsibilities.

Streamline workflow to enhance visibility and collaboration

Cloud accounting is conducive to collaborative and remote working, as long as processes are re-engineered. Overturn email approvals in favour of workflow tools that automatically send transactions, record activity and escalate exceptions. Create dashboards that call out conditions such as exceptions, approvals pending and key metrics. Optimizing workflow increases throughput and enables you to realize which parts are bottlenecks, as well as providing an auditable record of activity in support of compliance and continuous process improvement.

Invest in staff training as well as change management

But technology by itself can’t produce results without people using it. Train in natural language: Choose a role-based training program, hands-on exercises and reference materials. Leverage change management principles: communicate the benefits up front, ensure critical stakeholders are involved in design decisions, and demonstrate leadership support. Enable finance staff to act as evangelists, driving their peers to embrace new process and thereby creating lasting cloud financials sustainability.

Monitor performance and iterate

Post go-live, track results over time relative to your objectives at the outset. Monitor metrics such as close time, days sales outstanding, invoice processing time and automation rates. Leverage these insights to determine where you can further automate, improve integrations or set new controls. A culture of measure and iterate means the cloud environment changes as the business does, each positive change rendering new productivity benefits.

Plan for the growth and development of its capabilities

Select architectures and techniques that are scalable as transactions increase or new business requirements develop. Modular integration approaches, reusable data models and standardized APIs will simplify the addition of new systems or expansion into new geographies. Watch for nascent capabilities including advanced analytics and machine learning, which, when responsibly applied in cloud accounting workflows, can improve forecasting, anomaly detection, decision support and more.

Balance agility with compliance

Cloud accounting can speed up processes, but it has to be regulatory and tax compliant as well. Incorporate compliance checks into workflows, keep audit trails and maintain documentation of control procedures. Work with auditors (internal or external) early in the process to vet configurations and reporting. Agility and compliance in balance This allows the company to protect itself while pursuing expedited, informed financial operations.

Conclusion

Cloud accounting: Success starts by combining powerful tech with disciplined processes, good data habits, and people focused on change. By establishing a focus point, standardizing processes, ensuring data quality, carefully integrating systems together, automating routine tasks, securing access appropriately – and training staff while measuring outcomes – finance teams can revolutionize operations and provide valuable strategic input. Look at cloud finance as an ongoing journey — one that grows with your business and enables consistent progress throughout the entire organization.