The finance department is facing mounting pressures to not only increase process efficiency but also rise to a more strategic level. A finance transformation is even more urgent when it comes to international expansion. In fact, a study by Aberdeen Group in 2012 indicated that the need for agility to account for market volatility is the top pressure impeding global expansion.
With effective international accounting software, businesses should be able to adapt to change without changing
Businesses with effective international accounting software will realise that change does not necessarily mean upheaval; it can be a growth opportunity instead. To build upon the last post, which touches upon issues such as multi-company accounting, the checklist for global accounting software continues:
Supporting multiple charts of accounts
According to Ventana Research 2011, “Maintaining multiple charts of accounts may prove to be both simpler in the long run and more productive,” despite some saying that it is best to have one chart of accounts only. The rigid approach of a single chart of accounts is especially unsuitable for companies with different lines of businesses, those in joint-venture arrangements or those acquiring businesses in different countries. Thus, international accounting software should be able to handle simultaneous charts of accounts.
Handling multiple calendars
It is a fact that businesses around the world do not operate on the same fiscal year. To save time from having to recast figures into different calendars, businesses with multinational operations should implement a financial management system that can create local, regional and consolidated reports for management or statutory purposes as needed.
Handling tax complexities
For companies operating in various countries, international accounting software should be able to handle the complexities associated with different tax regulations, and help defending tax audits. Apart from addressing issues such as multiple entities, charts of accounts, calendars and depreciation schedules, their system should be configured to be tax-aware. In other words, it should provide enterprises with automated maintenance of rules and rates.
Check back on this blog for the last article in this series. Can’t wait? Get a sneak peek at a world-class global finance solution now!