Real-time accounting is revolutionising how enterprises manage their financial close. It eliminates delays and manual bottlenecks and empowers teams to work faster, smarter and with greater confidence.
In this blog, we'll explain live accounting and how it can accelerate the financial close process. It’s time to upgrade from the standard batch-file solution and unlock new levels of efficiency, agility, and trust in your financial operations—here’s how.
What Is Real-Time Accounting?
Real-time accounting means instant access to the most up-to-date financial data from your ERP system, which is paramount for informed decision-making and sustainable enterprise growth. It is miles ahead of traditional methods that rely on periodic updates (monthly or yearly) and ensures every transaction, journal entry or adjustment is reflected immediately. This enables finance teams to make assessments based on accurate, current information.
Why Real-Time Accounting Matters for Financial Close
Accurate financial close is vital for preparing journal entries and making predictions for the next fiscal year. However, this cannot be achieved with manual entry. Instead, most enterprises use real-time accounting to eliminate irrelevant data, catch errors and close discrepancies.
Real-Time Accounting vs. Traditional Batch-File Processing
Real-time accounting uses continuous data integration to process financial transactions as they happen. Without live streaming, accounting teams would depend on traditional batch-file processing (hourly or daily exports), which would lead to outdated data.
Let’s look at how manual data entry compares to high-speed real-time data processing:
Live ERP Data Streaming vs. Manual Data Entry
Users of batch-file solutions often rely on manual uploads and data entry, leading to inefficiencies, errors and delays in closing the books each month. Because of the increased chance you are working with old data, there is a greater risk of inaccuracies and inconsistencies in financial records, undermining the reliability of the information for decision-making purposes.
On the other hand, enterprises that combine automated data entry tasks, like prepopulated journal creation and reconciliation templates, with live ERP data can make decisions faster. That way, your finance team can work steadily through their closing tasks because the data is always best-in-class and up-to-date.
Live ERP Data Streaming with Aico
Aico’s ERP integrations enable continuous real-time work for accountants and finance professionals. Within Aico, you can set up workflows to allocate resources more effectively, redirecting manpower from manual data entry to value-added financial tasks such as analysis and strategic decision-making.
Proactive Accounting vs. Reactive Accounting
Finance teams that use batch-file uploads often adopt a reactive approach during the financial close, responding to issues only after they have occurred as they rely on outdated or incomplete data. The reactive nature of batch-file solutions impedes agility and innovation as enterprises struggle to keep pace with the speed of change in the market.
On the other hand, real-time insights allow teams to do ongoing transaction monitoring, identify risks early and resolve issues before they escalate. Alerts for anomalies or variances enable swift action, turning the close into a strategic process rather than a firefighting exercise.
Proactive Accounting with Aico
Aico enables proactive accounting through continuous monitoring of financial transactions, facilitating early detection of issues and proactive risk mitigation. With real-time updates and alerts, your team can anticipate challenges, identify opportunities and take immediate action where necessary.
Data Accuracy vs. Lack of Trust
Users of batch-file solutions can’t attest to the accuracy of their financial data, given that manual entry and batch processing methods are slow and prone to errors. Traditional methods with time lags of even only a few minutes can lead to issues.
On the other hand, real-time accounting hinges on data accuracy. This is exactly why up-to-the-minute data for the financial close is vital—enterprises can rely on the integrity and precision of their data for confident decision-making.
Data Accuracy with Aico
With Aico, enterprises can trust the accuracy of their financial data, combining confident decision-making with faster insights. The transparency of Aico's platform and clear data trails help stakeholders feel more confident about your enterprise, resulting to better relationships with investors, regulators and customers.
Overcoming Challenges in Adopting Real-Time Accounting
Switching to instant accounting can be a game-changer, but it does come with some challenges. Integrating it into older systems might require time and investment. Security becomes more crucial since data is constantly being updated. Plus, some team members may struggle with the transition. Here's a quick breakdown of the challenges:
- Integration with existing systems can be complex.
- Ensuring data security with continuous updates.
- Resistance to change from staff accustomed to older processes.
- Potential technical glitches affecting trust in the system.
However, with the right tools and support, these hurdles are manageable. Let’s take a look at some best practices you can follow to adapt to the changes.
Best Practices for Sustaining Live Accounting Success
Adopting real-time accounting is just the start. To make sure it’s effective in the long run, you should follow these best practices:
- Keep learning: Real-time tools change as new technology emerges, which means you’ll need continuous training to keep up. Consider having meetings about platform updates to help your team stay sharp
- Audit system integrations regularly: Even smooth ERP integrations can face issues over time. Make sure to review them periodically to verify data syncing and test for errors.
- Use advanced analytics: Real-time financial reporting provides you with much more than just speed. Take advantage of it by using its analytics features to identify trends and forecast cash flow.
- Ensure scalability: As your business grows, your accounting system should too. Look for platforms like Aico that scale easily as you expand, adding new subsidiaries or handling regulatory changes.
- Collaborate across teams: Involve IT, operations, and compliance in your financial processes. This ensures smoother integration and helps get the most out of live accounting across the company.
Aico’s Solution for Real-Time Accounting
Aico's real-time accounting offers enterprises several advantages, including a faster month-end close, dynamic analysis and proactive decision-making. These are not fully realised by users of the standard batch-file solution due to delays, intermittent updates and the possibility of inaccurate reporting.
That’s why Aico offers real-time, live integration from the Aico platform to multiple ERPs or multiple instances of an ERP system:
Is your financial close process fully integrated into your ERP for real-time accounting? If not, contact the Aico team for a consultation on your financial data needs.
