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Nov / 25 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article here as well. When talking about digital ...


Sep / 29 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article as well. Bobsguide spoke to Ivan Popov, chief technology officer at ReconArt, about the future of data reconciliation technology and how automation is going head to head with obsolete process frameworks and concepts in accounting and financial reporting What are the main reasons these days for companies to pursue reconciliation automation?Reconciliation automation fits into the broader concept of business transformation in the realm of finance & accounting. To put it in a perspective, those efforts are aimed at reducing manual operations, tackling complexity, securing greater reporting visibility, adequate response to regulatory requirements, plus data security and integrity for that matter. Reshaping reconciliation toward those objectives makes no exception. Times are dynamic, even turbulent, but also offering growth opportunities for those equipped to seize them. Companies often need to figure out how to achieve more with less resources or adopt quickly new modes of operation due to changed demand. This requires agility and resilience and this is where the technology provides tremendous leverage. Company strategies should be aligned with those challenges and address them with the appropriate tools. What is so wrong with the manual reconciliation? After all companies have been doing it for decades?Listen to F&A folks. That’s what ReconArt does. Their feedback is quite unanimous. Transaction level reconciliation even with medium volume of transactions is a burdensome and time-consuming, if possible at all. In our experience reconciling manually in spreadsheets might work only in simple reconciliation scenarios involving few criteria and matching based on exact amount. Ticking and tying in spreadsheets is also prone to errors and completely inadequate for large volumes of data. The reconciliation logic is often obscured and unfit for audit. Data flow in from disparate systems with little structure or integrity, which requires involvement of IT specialists to adjust the numerous file formats. With spreadsheets, investigating and documenting outstanding items is chaotic and tracking exceptions aging is impossible, which exposes compliance vulnerabilities. Period-end close workflow relying on emails running back and forth, spreadsheets and signing off printed copies makes it difficult for management to track progress or prove consistency of the activities. Those pain points are particularly pronounced for businesses handling large transaction volumes. Often they go through periods of intensive growth but something in their cash management does not add up and the bottom line suffers. Manual balance level reconciliations give the false sense of confidence while actually neglecting the problems with the untraceable aging of exceptions, transfers delays, additional fees, and many others discoverable only with transactional level drill-downs. Is there any additional value added from using an automated reconciliation platform that people rarely recognise immediately?The benefits are obvious – reconciliation automation is a cost, time, and human resources saver. Streamlining reconciliations and adding efficiency and transparency to them is the main motivator behind the process transformation leap. Even in the most complicated reconciliation scenarios, it enforces process visibility, consistency and auditability. A dedicated reconciliation platform, such as ReconArt, has an enormous analytical value add that goes beyond accounting control functions. It serves as a centralised repository for business critical data that is being updated in near real time. It can contribute to vendor management, it can support client satisfaction efforts, and it can reveal strengths and weaknesses in the sales and distributions channels. Also, data security and data privacy issues have been taken into consideration in the design of the ReconArt platform. The implementation of a cloud enabled enterprise class reconciliation solution is a long-term investment in process excellence as it adapts to the growth curve of the clients, who may want to expand the current recon processes and/or introduce brand new ones. However, that does not imply heavy product customisation or infrastructure expenses spill out. It’s an independent business user driven and governed change. A best practice solution, such as ReconArt, stays in touch with the evolving needs of the business users and the latest regulatory or technology developments. What type of companies seem to be most interested in advancing their recon processes lately?ReconArt delivers enterprise class functionality even to small and medium companies and has a wide variety of industries in its client portfolio. When our solution first stepped into the market, the banking segment was our primary focus. We have rich experience serving clients in that space. However, it soon became clear that ReconArt, due to built-in configurability, makes a perfect fit for insurance companies and brokers, investment management firms and the global financial services ecosystem. E-payments and money transfer platforms also stand out in that group. They are inherently open to innovations, experience expansive growth and are a benchmark for heavily transactional business. The pandemic has affected adversely the travel, tourism & leisure industries – another key client segment of ours, but on the other hand, healthcare and e-commerce yielded soaring demand. Still, they all came to the conclusion that uncertain times call for a new approach handling their reconciliation workload to ensure operational flexibility. We as a company see those shifts in the environment. The business consultancy, BPO and fintech community have detected them too and partner with ReconArt in search for synergy and new generation value added solutions for the end customer. What kind of alternatives are businesses looking for when implementing a reconciliation solution?There is more than one way to adopt a reconciliation solution. The option of choice largely depends on the end customers preferences, concerns, and business model specifics. Some go for full ownership of the product and its administration, while others would rather outsource the vendor selection, solutions implementation and support plus professional services. Seamless integration with the core business systems and the ease of migration to the new tool are invariably attended to. No need to mention the total cost of ownership and client projected ROI. The final decision comes down to assessment of the factors above. For those scenarios our partners offer full range of services ranging from complete handling of reconciliation process for the end customers to implementation of ReconArt for the customer and then hand it over to them for day-to-day operations. ReconArt is a product company and we have recognised the significance of partnership to deliver value for our clients. Therefore we have developed a number of flexible partnership models based on mutual benefit and common understanding for client satisfaction. We are transparent about our pricing policy and commercial terms. We offer full support in every step of the project – marketing, post-sales services, training & education. Our partnership network is expanding robustly and we are looking forward to the opportunities ahead. Looking ahead, how do you see the industry developing in the medium term?Until recently reconciliation itself as an integral part of financial reporting and control was confined within narrowly specialised professional circles. Today more and more enterprises come to terms with the business critical role of data reconciliation and acknowledge the importance of its modernisation and reinvention. The application of artificial intelligence, machine learning, business analytics and system-to-system integrations in reconciliation space are notable emerging trends. Handling ever higher volumes of transactions by using latest technologies and architectures allows us to cover new reconciliation scenarios and demands in new industries. Since its inception in 2011, ReconArt has been in the forefront of this campaign, delivering a sophisticated solution for end-to-end automation and management of all reconciliation processes. ...

Aug / 10 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article here as well. By definition, corporate process optimization propelled by digital transformation is a continuous effort. Technology innovation, pressure to stay ahead of the competition, and evolving customer needs demand enterprise act. Despite potential internal resistance, doubts and concerns about taking the leap forward, the real challenge is to stay determined, step out of this imagined comfort zone, and come to terms with the inevitability of change for the sake of improvement. Change is good: it builds resilience and opens doors. But if it’s not managed businesses can get crushed. The notion of reconciliation process improvement crystalizes during critical periods – such as around deadlines, staff changed and new quarters – for financial reporting teams. At a certain point every up-and-coming company experiences the pains of growth and must adapt by revising its operational adequacy. With reconciliation, the breaking point usually takes place when the workload grows out of the manual framework and becomes unmanageable. Process automation shifts gears to take productivity to another level. This is imperative. Once that’s realized, the form of ownership suitable for the company’s immediate and long-term needs as well as the allocation of project resources must be decided. It is not so much about picking the vendor, but rather choosing a model that would strike the balance between risk, costs, and benefits. Initially, many corporates consider developing a recon technology solution in-house, relying on the competences of their F&A and IT departments. However, it often becomes apparent that the make versus buy consideration is a short debate when costs and resource consumption are collated. Also, the reconciliation software market offers best practice solutions capable of meeting industry specific requirements without heavy customization. It is the appropriate time to explore the adoption of a comprehensive reconciliation system from a technology provider. Certain industries are heavily skewed towards large volume and complex reconciliation, because that is the nature of their business. We can profile these verticals. Invariably, they handle loads of transactions and/or many counterparts and more often than not they work in the B2C or C2C arena. They sell at low margin and compensate for it with a huge number of transactions. Their sale cycle might be relatively short and the turnover runs at a fast pace. They might be in the B2B segment for that matter, but their production flow might involve a complex network of operations with lots of suppliers, or intricate distribution networks. Banking & finance, insurance, payment & remittance services, e-commerce & retail, travel & tourism, consumer leisure & entertainment, utilities & energy, manufacturing, education, and healthcare are some of the most common examples. Companies turn to their ERP vendor for an external recon solution. With complex data reconciliation considered a niche requirement, few ERP vendors can afford a refined module dedicated to it. Rather it is a very basic functionality for general purposes and with limited application. But a growing segment of enterprises need a reconciliation tool that would respond to their business specifics and can offer ample flexibility to match their transaction scale. ERP vendors may not have the expertise or the priority to develop a whole new embedded module by request. However, through integration with a third-party solution they can complement their offering and add value for the client segment focused on transaction processing and settlement. End customers are often wary of the time frames and resources required to pre-select and implement a new tool, however crucial. Through technology advisors / consultants, however, they can avail market intelligence and endorsed reconciliation solution provider shortlist. Consultants are cognizant of similar use cases and can detect patterns in their customers’ needs. They can contribute with their developed network of industry partnerships and their know-how in walking the digital transformation path. Consultancy firms can assist with different aspects of the project – gap analysis, gathering requirements, market research, leading the vendor selection process among others. Post-sale activities and the deployment of the selected platform can also be covered if consultants have the technical staff and the knowledge to conduct the implementation themselves. Implementing a reconciliation solution requires a careful survey of the current client process and the mapping of that process into an automated framework. Besides that, they can plan and execute the smooth interaction and integration with the core business management systems and the migration from the legacy system. Another important milestone is the training of the staff to take control over the new tool and reveal its full potential in order to fulfil the objectives of the transformation project. Empowering internal specialists to be self-sufficient in new processes implementation and day-to-day operations handling is a central issue here. Clients with urgent reconciliation needs who willing concentrate on other aspects of their business operations can resort to professional services. Thus they would retain the ownership and the control over the recon tool, but keep its F&A team out of its daily administration and transfer those responsibilities to professional service providers. Professional services give certain operational flexibility to focus on priority tasks within the company, but also preclude staff ramp ups and narrow the core team duties to monitoring and control functions. This setup is bound by the maturity of the client organization and its readiness to sustain a long-term tri-party relationship. Outsourcing entirely the reconciliations processes shifts the workload and the related infrastructure management outside the company’s domain. On one hand, it delegates the daily transaction matching and / or monthly account recon to professional services providers from the BPO segment and disengage the internal teams. On the other hand, it resolves painlessly the troubles with managing automated recon product and the accompanying infrastructure. It might also have sense in terms of cost and risks of adding another system to the business process management setup. Then BPO organizations are the ones to evaluate what combination of qualified delivery workforce and digital tools would produce the greatest value for their clients while keeping operational agility and cost effectiveness at check. Acquiring a reconciliation automation solution can be tailored to fit any organization strategy. In any case, it would take burdensome manual work out of the equation and open the avenue for continuous process improvements, risk mitigation and cost reduction with exceedingly better results in terms of effectiveness. Companies affected by reconciliation process shortfalls are not alone in their quest to overhaul this often neglected sphere of accounting and financial reporting. Undoubtedly, they have the necessary tools set to do that and more than one alternative to implement it in line with their business specifics and unique circumstances....

Jul / 16 / 2021

ReconArt, a market leader in data reconciliation and financial close management solutions, and F1 Consulting, an esteemed management consultancy and financial advisory firm operating in Brazil, are delighted to announce their partnership agreement. ReconArt and F1 Consulting combine their expertise to bring forward a value added offering for process redesign of financial reporting and controllership. Brazilian enterprises and the broader Latin American market can now leverage advanced reconciliation technology to boost their operational efficiency around large volume transaction processing and enhanced financial controls. With customers in the Food & Beverage, Farming & Agriculture, Retail, Hospitality, Industrial Manufacturing, Oil & Energy, Leisure & Entertainment, Insurance, Education, and Internet & Technology, F1 Consulting has gathered significant industry insights to recognize and refer ReconArt as a sophisticated platform which addresses all aspects of the total reconciliation lifecycle and fits in complex financial process optimization strategies. ReconArt, headquartered in the USA, is a single-solution technology company which drives innovation in the recon space and helps a global client base establish robust, flexible and scalable data reconciliation processes. ReconArt has designed an entirely web-based solution for data matching automation, streamlined account reconciliation and financial close management. The platform incorporates a decade of professional experience in the field and best practices serving clients of all verticals and all sizes. F1 Consulting, established in 2019 in Brazil, is an ambitious team of skilled problem solvers with rich experience in strategic planning, corporate reorganizations, financial restructuring, M&A in demand with medium and large fast growing and startup companies. F1 Consulting evaluates and delivers cutting-edge solutions for financial planning, accounting, cash management & treasury, operations, revenue, purchasing, HR, and logistics to help its client navigate their digital transformation projects and achieve superb results plus faster returns. The ReconArt partnership program provides a variety of collaboration alternatives for technology vendors, system integrators, providers of outsourced financial services, and business consultant aimed at value-added solution offering and client-centered synergy. For more information visit our Partners page. ...

Jun / 15 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article here as well. Even without being acquainted with the craft of accountants, many have picked up stories about the gravity of the financial close. A nerve-racking event which takes place every year-end and originates numerous anecdotes and memes. What is financial close? The financial close is a crucial process that rounds off the daily efforts of the finance and accounting teams to capture, measure, record, classify, report and analyse every single business operation. It is a mean to one end – to periodically draw up the complete and precise account of the company’s commercial choices and let the stakeholders assess the results. Without oversimplifying it, the financial close is essentially a revision and summary of the financial account movements applicable for the past period. This overhaul ensures that numbers are double-checked, verified and all parties have fulfilled their obligations. The close process is time-sensitive, has little tolerance for errors or inconsistencies and requires a lot of coordination. Failing on either of these points not only defeats its purpose, but can also bring consequences or even penalties. The output of the close is scrutinised by the company management, shareholders, and potentially tax and regulatory authorities – especially in the context of publicly owned companies or the financial industry. Although the high-level blueprint of the process is quite similar for all business, the mechanisms of conducting a financial close can vary greatly depending on industry, size and structure, and legal requirements. Companies develop and tweak their own close process. Some of the process elements could be overemphasized while others may be omitted altogether. For instance – a US bank would adhere to SOX and SEC compliance guidelines. But a private manufacturing company in the EU would look out for its inventory and payables/receivables. Both would closely inspect their cash, tax and asset account positions. Old habits die hard Given the critical importance of closing the books accurately and on time, one would assume that cutting-edge technology is harnessed to run the whole campaign. However, this is not the common case. Many accounting departments still grapple with outdated systems or manual methods. Most of the grievances around the financial close are inflicted by poor infrastructure and suboptimal logistics. The financial close is a recurring multi-step process. It is established around a tree of codependent tasks delimited in sequence, assignment and timeframes. Every single account balance is reexamined and substantiated in a logical order depending on its volume and risk characteristics. The data is aggregated for statutory reporting. To manage the close process, accounting departments usually follow a template in the form of a task checklist in a shared spreadsheet. Regardless of company type, the challenges are similar. Firstly, it can be challenging to pinpoint who does what, when or why, and get at-a-glance view of how the close is progressing – something which finance executives are deeply interested in. The process owner and the process designer can be two different people. The unstructured process stifles knowledge transfer and as soon as key personnel are lost, knowledge gaps surface in the most inconvenient times. Account reconciliation is often at the heart of the financial close. Best practices dictate that key balance sheet accounts go through reconciliation and certification with at least two approval levels. Often trial balances are updated several times a day, resetting the approval cycle. Open transactions tend to pile up in the run-up to the cut-off date. Their posting and verification can linger because of general ledger processing downtime or standing by for other departments’ input. Communication bottlenecks are a big pain point. Balance adjustments should be properly documented along with evidence but the absence of process standards and a unified repository backfires during auditing. If the audit trail comprises a bunch of signed printouts, emails and fleeting notes, the integrity of the process could be questioned. For some companies, the financial close could be even more expansive, covering aspects such as the analysis of month-to-month variances or the preparation and approval workflow of missing journal entries. These requirements must then be coordinated with account reconciliation and other close tasks to complete the entire process. There must be a better way In the context of the financial close, pressure to meet these high standards within strict deadlines often collides with an inefficient process framework. As a result, accountants rush through errands without clear perspective of the big picture. Add the struggles of repetitive manual operations, constant switching between screens, excessive progress checks and reporting requests further hurting productivity. People try to compensate with long stressful hours and compromises with precision – hence the infamous reputation of the close. Companies interested in maximising productivity and financial control, as well as improving work-life balance, have seized the opportunity to dismantle this rollercoaster and profoundly reform their financial close process. The pursuit of improvement inevitably confronts with fear of change or becoming redundant and clinging to the familiar. Accounting folks are prudent about novelties in their sphere, partly because of disappointing experiences with less than ideal software solutions. They evaluate fintech innovations in practical terms: Does it do the job reliably? Is it tailored for my needs? Is the learning curve steep and will I be able to manage it independently? Are costs commensurate to benefits? Problem solved Being a recurring and quite invariable process, the financial close is perfectly suited to automation. The primary challenge for a sustainable software solution to address is the coherent and flexible incorporation of all essential financial close components – task management, account reconciliation and certification, journal entries creation, variance analysis of the account balances, and intercompany reconciliations. ReconArt covers all the bases and brings forward a versatile, integrated, best practice platform which permanently replaces fragmentary and inefficient workarounds. The solution automates all reconciliations related to the period-end close – the continuous upload and matching of updated trial balance data, the monitoring of tasks progress and completion in line with the assigned roles and separation of duties, the account balance justifications and approval workflows, the initiation of journal entries, the variance analysis of balance fluctuation across accounting periods. The platform’s flexible configurability allows for a thorough mapping of the customer’s close process into a secure SaaS environment. Business specifics and internal policies are observed and users construct and administrate their processes independently. Period-end process know-how is no longer vested in informal institutional knowledge. The lists of to-do items are organised hierarchically in calendars and pushed through machine-driven workflow where roles are strictly encoded and users are prompted to take action. Therefore, task follow-up to completion is guaranteed and status is reported in near-real time. Accounting teams will find it beneficial to have their task checklists dynamically updated and visible in one system together with all their reconciliations data and accompanying documentation – the connections between account balance and the matched transaction forming that balance is made evident. The system maintains a granular audit trail and centralised recon data repository – ranging from a detailed log of operations to automatic controls and links to notes and attachments. The tool is highly adaptive to changing business needs such as introduction of new business lines or organisational changes, remote teams, home office. It supports continuity, process audit and improvement initiatives. The streamlined financial close brings transparency and predictability, remedies frustration, saves time and improves efficiency. Automation of manual operations transfers the heavy lifting to machines and makes room for precision and in-depth accounts analysis. Complete audit readiness with all reconciliation data, supporting documentation, task assignments, and progress tracking tools in one place is well within reach in a neat, simple to navigate environment. The bonus? No “heart attack” at period-end. ...

Jun / 10 / 2021

ReconArt, a market leader in data reconciliation technology and financial close management, and 3i Infotech, a global IT company driving digital transformation initiatives on 4 continents, are delighted to announce their partnership agreement. ReconArt and 3i Infotech join forces to support the digital transformation journey of enterprises with complex business needs in the realm of middle and back office operations and financial reporting. The automation and standardization of manual reconciliation processes have become a priority for organizations dealing with growing transaction volumes, escalating complexity, and strict regulatory and compliance requirements. The adoption of an integrated SaaS reconciliation solution such as ReconArt brings enormous benefits around data consistency and auditability, robust internal controls, cost-effective process optimizations, and scalability without additional headcount. ReconArt and 3i Infotech combine niche technology and best practices with deep domain expertise and a proven record of successful technology implementations. The collaboration between ReconArt and 3i Infotech is an opportunity to create a transformative impact on critical finance functions and accelerate the transition to operational excellence for F&A departments across various industry verticals. Both companies are result oriented, committed to superior customer experience and the highest service standards. 3i Infotech, emerging as a leading name in propelling the current wave of digital transformation initiatives, with deep domain expertise across BFSI, Healthcare, Manufacturing, Retail and Government sectors. The Company has over 4000 employees in 30 offices across 15 countries and over 1000+ clients in more than 50 countries across 4 continents. With a wide range of IT services, 3i Infotech has successfully transformed business operations of customers globally. The Company has a very strong foothold and client base in geographies like North America, India, Asia Pacific, Middle East and Africa, Kingdom of Saudi Arabia and South Asia. ReconArt, headquartered in the USA, is a single-solution technology company dedicated to data matching automation, streamlined account reconciliation and financial close management. ReconArt has designed an entirely web-based platform for end-to-end management of all data reconciliation processes. For the past decade ReconArt has been serving a global client base of all industries and all client sizes, constantly reinvesting in product evolution. ...

May / 19 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article here as well. 2020 will go down in history as a tumultuous year. We are in a defining period of time, challenging human ingenuity, perseverance, and priorities. Adapting to change can be painful and uneasy and it takes time to realise the opportunities for improvement it presents. Businesses are compelled to face the reality of change and deal with it right now. Many have suffered in faltering markets, disrupted supply chains and regulatory uncertainty. Competition has intensified and has pressured enterprises into strategic and operational revision. Some dared no further than damage control and conservation measures such as sweeping and often indiscriminate cuts, lay-offs, and reliance on government stimulus. Others accepted the fact that there is no way back to old ways and chose to future-proof their business plans. Spending cuts are commonly on the table when firms buckle up to weather a sudden change in the odds. However, putting technology adoption on halt might backfire. Management discretion to press forward with digital transformation projects pays off in the long term, as the return on investment in technology to enhance efficiency often outweighs potential savings. Process improvement and optimization, although widely endorsed, often faces internal procrastination. In some instances, there can be internal resistance or little awareness of the latest technological breakthroughs. At the same time teams struggle with repetitive, manual, error prone tasks. For finance and accounting it is especially true, particularly when it plays a business critical support role. In reconciliation automation, ReconArt area of expertise, we have extensive experience with one of the most conservative, regulated and risk aversive financial industry segments – banking. Its complexity and cornerstone role in the finance ecosystem is underlying widespread fintech innovations. Yet, within transaction matching and period-end close solutions, it is staggering that spreadsheets are still the prevailing tool to tackle enormous data flows. The banks showcase the imperative to mind data security and quality, scalability, regulatory compliance and reporting when reconciling accounts. But besides banks, large volume transaction processing is a core activity for industries such as remittance & payment, retail & e-commerce, investment management, insurance, among others. The F&A teams encounter the same challenges though in a different scale. Many are preoccupied with mundane and low-value chores of ticking and tying which saps resources to the detriment of higher priority and higher return tasks. Automation is a synonym for time savings. In reconciliation that is an undisputable fact. The most cited immediate benefits for ReconArt clients are better human resource utilization, improved motivation and productivity, and even workload distribution across the calendar. Those returns on the investment in the right reconciliation solution invariably weigh in favor of implementation and are the first to factor in by the decision makers. Dealing with poor data quality and multiple data feeds in disparate file formats is another controversial matter. Manual data consolidation is untenable and the lack of standardization erodes successful matching results. However, this can be easily resolved through the automated normalization and enrichment functionalities of the modern reconciliation solutions. The dramatic reduction of human intervention in the reconciliation routine carries precision and efficiency only achievable in a machine-driven environment. ReconArt pursues end-to-end rule-driven automation to eliminate the risk of human errors and to sort out ever-increasing amounts of complex data. Reconciliation specialists know the wide variety of recon scenarios and peculiar cases they regularly stumble across. The recon system that would orchestrate the multitude of process steps without omissions or technical errors, consistently identifying matching groups by the user configured strictly logical blueprint – that is a recon system that would prevent losses for the company. Another important aspect of automating reconciliations is enhanced reporting transparency and multi-level control on financial streams. The analytical value of reconciliation data for informed decision making is immense and has been discussed before. Acting preemptively based on reliable, actual, up-to-date insights delivered by a sophisticated recon platform generates savings and reveals opportunities for improvement that are evident and measurable. Reconciliation teams searching for the perfect technology fit are often wary of the learning curve and the ease of operations a new tool can offer. They are reluctant (and rightfully so) to bet on an unwieldy, heavy maintenance system that would address their needs only partially while complicating their lives additionally. They need guarantees that it would recognize their business specifics, keep up with their pace and would not become obsolete in the long run. The potential disruption associated with migration to a new system and hidden costs occasionally arising put off the decision to automate. ReconArt meets and exceeds expectations in terms of scalability without incurring punitive costs on expansion and change. It is designed to be an intuitive, adaptable, truly business owned tool governed by its daily users. It is a best practice solution that undergoes regular updates and the product evolution roadmap considers and includes enhancements in functionality based on user feedback. ReconArt is a fully configurable platform which does not require customization, heavy infrastructure or professional services to run. The platform integrates seamlessly with other systems. During the initial implementation, process discovery, and user training prevail over technical preparations typical for installed software. ReconArt is entirely web-based solution hosted in the cloud with zero footprint on clients’ computers. Users can securely access the platform even when the financial team is forced to work remotely and the smooth team collaboration is at stake. Whatever concerns, doubts, or New Year resolutions businesses might have, technology adoption during a crisis should not be put on a backburner. Postponing investment in efficiency and arguing that this is part of the plan to slash expenses does not make much sense. The ultimate survival tactics during trialing times is not some form of hibernation but actively pursuing competitive edge through operational excellence propelled by technology....

Apr / 26 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article here as well. It’s the most wonderful time of the year! Well, except for the accounting community struggling with the year-end close. Most of the stress and frustration around closing the books is generated by unfit tools and the organization of the process. Managing period-end close in accounting has several distinct challenges every F&A professional can confirm. Verification and adjustment of account balances on cash and accrual basis is the primary objective. Certification of the balance sheet accounts plays a distinctive role in statutory regulatory reporting but is also a good practice from audit and compliance perspective. It is an opportunity to assess the overall financial health of the company and flag situations that bring operational risk. The negative implications of closing the books chaotically vary from penalties from regulatory bodies and tax authorities, to negative impact on the bottomline and loss of credibility in front of partners. Usually the process is carried out in close collaboration and coordination of multiple operational entities within the enterprise plus input from third parties. Account certification implies a hierarchy of approval levels under the segregation of duties principle. Depending on the size, the business specifics and the internal policies applied, an enterprise business may have 500 to 2500 accounts on average to reconcile at period end. Certain segments such as banking perform comparison of tens of thousands of GL account combinations. That staggering number is unmanageable without end-to-end automation and smart workflow management. The period-end close process enters the digital transformation agenda as soon as the absence of structured workflow and proper documentation compromises the reliability of the reported financial results. Data input quality and timely update is questionable as it scattered across various repositories in systems that may not interact. The close requires capabilities to aggregate data which when performed in spreadsheets rarely goes by without human errors and omissions. Period-end close is a time sensitive process that requires rigorous progress tracking at all levels. However, preoccupation with deadlines sometimes sidetracks precision and analysis of the account history. Besides account balances verification and consolidation, accounting specialists need to spare time for in depth analysis of account balance fluctuations across periods, tracking high risk items aging, and proper documentation. All-encompassing visibility requires flexible and fully configurable automation capabilities. F&A teams have drifted apart during the COVID-19 pandemic. Home office put a strain on team communication and the routine flow of operations. Departments accustomed to face-to-face meetings and generic tools such as Excel suffer from disruptions and delays in the most critical moment of the fiscal year when full mobilization is expected. Year-end close would be particularly demanding for multi-division organizations with extensive chart of accounts and long approval chains. Those would be the first ones to grapple with a primitive and rigid approach. Many of those pain points can be addressed and mitigated effectively in an automated environment leveraging the SaaS technology with simple browser access for end users. Running the year end remotely with spreadsheets, emails, and signed printouts must be abandoned in favor of a more streamlined and formalized process. ReconArt as a leading vendor in the reconciliation space has applied best practices in its Balance Sheet Account Certification & Task Management solution. The client chart of accounts is mapped within the platform structured in folders. The fully configurable certification template assigned to each account determines the certification procedure and schedule to be followed automatically. Accounts are classified, filtered and managed in groups with common properties and treatment, especially useful when the chart of accounts comprises hundreds of line item - for example as Bank Rec Matching, GL Cash, standard Balance Sheet, Income Statement, Nostro, Suspense, Clearing, etc. Depending on their risk degree they can be flagged as high risk/priority accounts for austere scrutiny. Hands-off extraction of trial balances from the GL can be pushed through a preconfigured approval workflow where each account follow the prescribed certification protocol. The balances are then justified through the value of the transactions (or sub ledger items) forming that account balance – can be zero, debit, credit or not specified. The difference between imported balance and explained balance is automatically calculated and highlighted so the preparer can take action to examine / explain that difference. System certification can be applied for accounts based on certain business rules (e.g. low risk, from specific categories, zero or unchanged balance status). This optimization reduces the workload while remaining fully audit-proof. Account certification is a multi-level approval workflow process shaped by the company’s policy. Best practices suggest a minimum of two levels are configured for the monthly certification but three levels can be required for the quarter-end or year-end certifications. The roles within that workflow are fully configurable in line with the internal chain of responsibilities – primary and backup, first and second line, Preparer, Reviewer, Approver, Manager, Auditor. The range of user access rights is determined by the respective role thus enforcing the separation of duties principle. Each account can be drilled down to make evident the connection between the underlying transactions and the account balance. For companies who implemented daily reconciliation on transactional level for certification eligible accounts, outstanding items are retrieved automatically to ensure full traceability of exceptions. Also, any user initiated changes in the account balances are captured in the audit trail together with the supporting documentation. The system puts auto check points such as mandatory attachments to substantiate the certification. The events in the audit trail can be filtered by account, time, user, or type of operation. The contents of the audit trail can be exported out of the system and analyzed for efficiency gaps. As the period-end campaign progresses, updated trial balances come in daily or even more frequently, so this stream of data cannot be navigated blindfold. Automated data import scheduled to refresh with near real time frequency guarantees quick reaction to incoming updates. Accounting can kick off certification from day 1 following the cut-off date. New trial balances imported in the system overwrite the old data and resets the approval cycle upon detected movement in the account while unchanged balances remain unaffected and up for advance in the approval chain. The automated workflow can shave off days only through eliminated clutter and redundancy, reduced reaction time, improved visibility and system sync. The configured calendars plus the events triggered by the users generate reminders for next steps in the workflow. Whenever a user input / action / awareness is required, notifications to address lags and bottlenecks are delivered. Active progress tracking can be performed via the customizable dashboards with high level information at a glance – count of outstanding accounts, account status, breakdown by account and user, total dollar value remaining to certify charted across days, etc. Apart from process steps, user designated tasks can be also be managed in the same integrated environment, adding another level of control on individual task completion. ReconArt incorporates the operational and analytical side of the account certification process - approval workflows and task manager, comprehensive reporting and variance analysis of the deviations from projected values. A particularly useful functionality is monitoring the aging of unreconciled items from origination to resolution date - calculated relative to user selected points in the item lifecycle to make sure it does note overstep the configurable aging tolerance threshold and pile up in the backlog unattended to. Avoiding the proverbial accounting frenzy at the year-end countdown is not a question of luck or endurance but embracing the right problem solving technology. ...

Feb / 10 / 2021

A special ReconArt feature first published on Bobsguide – the ultimate fintech resource, an innovative online platform that connects the providers of fintech solutions with the financial services professionals who need them. Read the article here as well. The rush for data insights follows the Olympic motto – swifter, higher, stronger. Admittedly, information is the most valuable commodity in times of fast and dynamic changes so it is being gathered meticulously, bought and sold, stored and exchanged, processed and consumed. In the corporate world this perception has nurtured the big data and analytics revolution. But unlike any other commodity, data abundance does not necessarily translate into solid business strategy straight away. Decision making based on actual data takes place only given the relevant data input, integration of various company data sources and the appropriate processing and analytical tools are at place. Traditionally, Excel has been used to cater for both data visualisation and the reporting needs of financial teams and management. It used to work (and still does) when the data sources were just a handful and the reporting needs were simple. But times have changed and companies face challenges of different proportions – they are now overwhelmed with data that they also need to monitor in dynamics. The absence of a single source of truth adds another complication. Financial, legal and compliance, marketing, sales, production records, and other crucial business data resides in separated systems. Each department takes care of its own domain and produces reporting output on demand. The management struggles to gather the full picture based on actual data, let alone to pick up more subtle developments, which often results in critical blind spots for the decision makers. Moreover, business data models often rely on a series of static snapshots that disclose a current status but fall short of exposing important trends in development. Conclusions are still based on past period extrapolations and arbitrary projections, instead of interpreting actual up-to-date data. For example, cash flow forecasts take into consideration sales data, but some recurring deviations may follow a pattern related to post-sale incidents such as payment errors, fees & interest rates incurred, penalties and discount miscalculations. Those might be one time accidents with a deep impact or repetitive instances. They might be a product of oversight, malign activity, negligence, or missed opportunity. Taken alone, each of those examples might not affect the quarterly results. But as the effects accumulate, their timely and prudent management makes the difference between the average and the brilliant. An unexpected solution for the analytical needs of the company is the company reconciliation platform. It integrates different data sources and correlates data residing in different system for reconciliation purposes. This data holds a great analytical value add. Reconciliation captures a wealth of business relevant data flowing daily. Cloud-based reconciliation solutions store transaction data from various sources – ERP or general ledger, sales systems, payment processors and other industry specific systems. You could say, transaction data is the blood and veins of the communication with the outside world as it traces the relationships and the exchange between any given business and its essential counterparts – clients, suppliers, regulatory bodies, governments, banks. It is a detailed account of the company’s actions and their results in near real time. A reconciliation tool is also the place to normalize and enrich the transactional data from various file formats, not only for the purpose of the matching and reconciliation itself, but also for the control, reporting and analysis needs. Tapping data from an automated reconciliation platform marks a leap towards the resolution of a long standing, complex and time consuming challenge – consolidating data sourced from a multitude of disparate business systems. This consolidation is an integral step of the reconciliation process but can also be incorporated in the business analytics of the company without any additional modifications needed. Having said that, it is perplexing how underestimated the analytics potential of transaction data flowing in and out of a modern automated data reconciliation system can be. Reconciliation itself, widely perceived as a seemingly mundane accounting routine, has been recognised as a control process primarily. But all businesses, particularly the ones dealing with processing large transactional volumes, should revisit the role of reconciled data in their data models and underpin C level management decision making. Reconciliation is not isolated in the realm of financial accounting and it can build organic correlations with other essential business operations such as supplier management, customer retention policies, partnership development efforts, planning and budgeting cycles, etc. Data from the reconciliation systems can be retrieved with various levels of granularity and can be employed for precise cross-sections. Its unexplored potential should be adequately harnessed in business process analytics. Reconciliation data in a specific industry context can provide an in-depth overview of critical business operations and highlight vulnerabilities or spot opportunities. Business strategy adjustments to navigate uncertainties and threats are substantiated by dynamically updated and consolidated actual data. Here are just few basic examples. All of those instances encourage cash flows optimisation, mitigate risks, and generate savings. Bank branches can pull ATM reconciliation data and construct a heat map of cash drawing activity for efficient logistics and expense planning or optimising the ATM network based on real ATM usage. AR reconciliation process data can be assist cash-flow optimisation based on aging, commissions paid for payments processed or currency conversions and ABC analysis of customers based on their spend. Retailers & e-commerce merchants can keep an eye on customer preferences for payment channels and negotiate more favorable terms with payment processors regarding fees, volume discounts, currencies, methods of payment, or settlement timeframes.  In turn, payment service providers can keep track on FX exchange rates and volumes to counter currency risk, or, alternatively, to monitor delays / bottlenecks and manage effectively their partner network.  Bank reconciliation data can hint for consolidation of corporate bank accounts.  Etc.  From technical perspective, utilising reconciliation systems data is straightforward and involves tools that already exist in most companies so no heavy infrastructure or capital investments are required. Modern reconciliation systems, through their built-in ETL functionalities, enrich and normalise the records. That output advances the transition from unstructured data to structured data. Upon the transfer into a data warehouse it becomes readily available to be extracted and displayed in management dashboards. Thus a unified repository of normalised business critical data is created – updated in close to real time, auditable, IT security compliant. It serves the construction of accurate metrics and KPIs with a wide application within the business organisations. In combination with the rich visualisation capabilities of third party software such as Microsoft Power BI, Tableau, IBM Cognos, Sisense, Qlikview, etc, it forms the backbone of the business analytics setup. Thanks to the new technology solutions for process automation, reconciliation has made a remarkable comeback as an integral part of the business decision making framework proving its robust capacity to reveal valuable analytical insights....

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