Ask ten firms how long the close takes and you get ten answers. However, when asked which part consumes the hours, the answers converge quickly: it is rarely the judgement. Instead, it’s the fetching, matching, and formatting that sit between the judgement calls.
Most closes are not slow because the accounting is hard, but because a handful of deterministic, repetitive steps were never written down or automated. These steps are re-performed by hand every period, often by the most expensive person in the room.
Understanding the Close Process
Every step in a close falls into one of two buckets: deterministic or judgement-based. Deterministic steps produce the same output every time, given the same inputs, and include tasks like exporting a trial balance or matching cleared items against a bank statement.
On the other hand, judgement-based steps require professional judgement, such as deciding whether an accrual is reasonable or whether an estimate is still supportable. This is the work clients actually pay for.
The rule follows directly: automate the deterministic steps and protect the time for the judgement-based steps. Firms that get this backwards end up reviewing machine judgement, which is slower than exercising their own.
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Identifying Steps to Automate
Four deterministic steps survive in most firms long after everything around them has been modernised: getting data out of the ledger, reconciliations, schedule roll-forwards, and assembling the reporting pack. These steps are pure mechanics and consume a significant amount of time.
Sequence matters more than tooling. The exports should be automated first, as every later step depends on it, and the output is easy to verify. Reconciliation matching is the next largest saving, followed by schedule roll-forwards and report assembly.
Notice what is absent from that list: accrual judgement, variance investigation, estimate review, and reclassification decisions all stay with the accountant. Automating around them is precisely what buys the time to do them properly.
Whatever you automate must leave an audit trail. Any step a reviewer, successor, or regulator cannot reconstruct is a liability. If an automated step cannot show its inputs, rules, and output, it does not belong in the close.
Pick your most repetitive client and time one close honestly – not from memory, but with a stopwatch on each step. Most firms are surprised by the result: the judgement work they assumed dominated the close usually takes less time than the data handling surrounding it.
