Closing the books: understanding financial close challenges

For every organisation the financial close is a crucial milestone. It marks the culmination of accounting activities for a specific period, demonstrating accuracy and compliance with regulatory standards. However, achieving a seamless financial close is often easier said than done. As one of the most complex finance processes, various challenges can delay reporting, compromise accuracy, and put pressure on finance teams.

“It’s impossible to optimise the financial close without first understanding the challenges your team are facing each month,” says David Watson, Head of Consulting at Concentric Solutions. “Then, with the right approach and technology, your organisation can achieve a faster and more accurate close, ultimately leading to improved financial performance.”

In this blog, we highlight the common challenges encountered by finance teams during this critical process and provide practical solutions for overcoming them.

Key financial close challenges

Data quality: building a reliable foundation

Ensuring the integrity and accuracy of financial data is paramount for creating a reliable foundation for financial reporting. Yet, disparate systems, manual entries, and poor data control can significantly erode data quality. Late adjustments, reclassifications, and reconciliation issues are often symptoms of broader systemic weaknesses.

Implement robust data governance practices and automate key activities such as foreign exchange revaluations and balance sheet substantiation. Adopting a unified Enterprose Performance Management (CPM) solution ensures consistent data structures, reduces manual effort, and enhances control over critical financial data.

Regulatory compliance: keeping pace with evolving standards

Adhering to shifting global and local regulatory requirements adds significant pressure to finance teams, particularly those operating across jurisdictions. Navigating between IFRS, multiple GAAP frameworks, ESG disclosure requirements, and statutory filing deadlines adds layers of complexity, requiring expertise, coordination, and precision.

Embed compliance into your financial close process through configurable EPM platforms with built-in support for multiple reporting standards and automated audit trails. Establishing a strong governance framework, training teams regularly on regulatory changes, and embedding controls across workflows are essential for mitigating risk and maintaining audit readiness.

Stakeholder management: balancing speed and accuracy

The growing number of stakeholders – ranging from operational leadership to external investors - brings increased scrutiny and heightened expectations. Under pressure to deliver a ‘fast close’, teams may prioritise speed over substance, producing numbers that lack the necessary context or confidence. 

Move beyond purely mechanical reporting by introducing workflow-driven close management that clearly defines roles and responsibilities, and improves communication between teams. Empower stakeholders with real-time access to validated data and create transparency around adjustments and controls to reinforce confidence in financial outputs.

Process inefficiencies: breaking free from spreadsheet dependency

Spreadsheets, while versatile, can become a double-edged sword. Reliance on Excel causes many finance teams to remain trapped in inefficient, spreadsheet-driven processes. Although spreadsheets offer flexibility, they also introduce version control issues, fragmentation, and inefficiencies that limit visibility and slow down the close.

Eliminate spreadsheet overload by migrating to integrated systems and embracing automation. EPM platforms centralise data, standardise calculations, and ensure process traceability. Removing bottlenecks and reducing the dependency on individual knowledge holders results in faster cycle times and a more resilient close.

Are spreadsheets sabotaging your financial close? Read our blog >>

Acquisitions and consolidation: overcoming legacy complexity

For organisations with a history of acquisitions, the challenge of integrating new subsidiaries and systems can complicate the financial close significantly. Fragmented ERP environments, inconsistent intercompany practices, information siloes, and legacy processes hinder timely consolidation and introduce reconciliation errors.

Standardise intercompany policies and automate elimination entries through dedicated consolidation modules. A modern CPM solution enables you to consolidate data from multiple ERPs, apply group-level controls, and deliver timely, group-wide reporting – even in the face of complex ownership structures and currency conversions.

In conclusion

The financial close is  full of risk, complexity and competing priorities. But with the right technology, processes, and governance in place, these obstacles can be overcome. By embracing standardisation, automation, and integrated technology, organisations can simplify the close, reduce risk, and produce timely, transparent financial reporting.

As stewards of financial integrity, finance professionals must continuously evaluate and optimise the close process – not just to meet deadlines, but to deliver insight that drives strategic value.

Next steps

If you would like a free consultation or to book a Financial Close Review, get in touch with our consultants by completing the form below.

Our Financial Close Cycle Review service provides an independent analysis of your financial consolidation and reporting cycle, including:

• Assessment of current key close processes and process management
• Benchmarking of time taken to complete common close processes
• Review of reporting needs
• Assessment of data quality, relevance and integrity
• Review of reporting structure efficiency
• Report of findings and recommendations