Accounting department assessment

The challenge

A Colorado-based, privately held professional services company with international services was growing rapidly. The CFO was concerned about the timeliness of financial statement issuance, recognition of transactions on a GAAP basis, and prioritization of long-term and short-term accounting and financial reporting initiatives.

The solution

Our team was engaged to perform an accounting assessment that focused primarily on the GAAP-basis transaction recognition; month-end financial close processes, including the identification of process improvements that would improve the timeliness accuracy of financial reporting; and suggested short-term and long-term accounting and financial reporting initiatives. Through employee interviews and analysis of existing financial schedules and reports, we identified GAAP departures, delays in month-end close and financial reporting, and a backlog of initiatives due to capacity pressures on the accounting team.

During the course of our assessment, our team identified transactions that weren’t recognized in accordance with U.S. GAAP, and we provided recommendations that would allow for future, timely GAAP-basis recognition. Due to the company’s international services and probable future attestation requirements, we presented practical and actionable recommendations for future GAAP-based recognition that would withstand the rigors of an audit.

To improve the timeliness and accuracy of financial reporting, our team proposed solutions to help leverage complex analyses to less sophisticated staff, reduce manual and duplicative data entry, standardize sources of supporting data across business lines, and implement internal control improvements without creating an undue burden on the efficiency of accounting operations.

Additionally, we recommended they add a controller to the accounting team to provide necessary additional capacity. This would also allow other accounting and finance leaders to focus on software and technology initiatives meant to address increasing automation business requirements. Finally, we highlighted and prioritized projects and initiatives for the accounting team to perform in the short term due to their critical impact.

The benefit

The company had a roadmap with practical and actionable recommendations to achieve attestation-ready financial statements and an accelerated month-end close schedule. Management evaluated the project and initiatives we proposed and committed to milestones and timelines for completion. Furthermore, the company identified a candidate for the controller position prior to the completion of our assessment project, and our deliverable provided a roadmap for addressing existing and future issues internally.