No matter how efficient and thorough an organization’s accounting team, if it performs reconciliations manually or through “rules based matching”, it is always going to lagging behind accounting teams that are automating the close process. This is because the manual reconciliation of an organization’s finances is time consuming, costly and prone to human error. More importantly, reconciliation errors having potentially major consequences to a company’s financial well being. High transaction volumes, multiple bank accounts, different transaction types, multiple currencies and various bank file formats only add to the problems.
According to a study by Robert Half & the Financial Executives Research Foundation (FERF), only 13% of F&A teams have utilized advancements in technology solutions like Sigma IQ, with the majority of CFO’s admitting they still struggle with painful aspects of account reconciliation like:
When these failures occur, audit findings can result in a significant deficiency or a material weakness in internal control, and costs can reach the hundreds of thousands, or even millions of dollars. Below is a review of some of the challenges often encountered in particular types of account reconciliation processes.
Fortunately, for finance teams A.I.-based solutions like Sigma IQ dramatically reduces both the time and resources required to close.
It is estimated that on average, a company with $100 million in sales, will unnecessarily waste 3-5 days to close each month, with most using rules-based matching and manual reconciliation.
Artificial Intelligence (AI) based reconciliation platforms, like Sigma IQ, solve this problem in a completely new way, dramatically reducing the human time investment required to close your books. On average, Sigma IQ can reduce the time to close by up to 90% and save hours per employee in labor time.
“Nearly 50% of finance executives are giving ‘very strong support’ in using automation to reducing finance costs and improving accuracy”
– KPMG Finance Transformation Report
Sigma IQ’s Matching Engine uses artificial intelligence to completely automate the reconciliation process, removing the need for a team of accountants to reconcile transactions. Whether thousands or millions of transactions, Sigma IQ’s proprietary patent-pending AI-powered matching engine maximizes match performance and accuracy without the need for manual rules or updates.
Importantly, advanced solutions like Sigma IQ are cloud-based, meaning teams implement account reconciliation tools with no implementation costs and get up and running in less than a day. This means you can start reconciling and provides you with a positive ROI from day one.
Also, data security remains a critical goal. Since technologies like Sigma IQ are built on top of modern advancements in technology, COSO 13 security controls are part of the design from day one, keeping security and compliance at the forefront.
By using Sigma IQ, your finance team can achieve the following cost savings:
As more and more finance teams continue to automate their financial operations, AI-based reconciliation platforms like Sigma IQ, will dramatically reduce the time and cost associated with month-end-close.