March 28, 2024

Financial Leadership: Why You Need a Month End Schedule

If you finish a routine monthly close in your hotel, and I certainly hope you do. And if closing your books takes longer than three-five working days, then this is meant for you.

NB: This is a post from Hotel Financial Coach

Doing your month-end and having a final financial declaration every month within one week is the standard for a group and system that works well. Taking any longer just implies you are really losing valuable time. If you are not the one who closes the books, however you would like the statement much faster, then this is also for you.

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There are 3 main takeaways from incorporating a month-end schedule to assist with the closing process, The 2 I already pointed out, interacting the schedule and using it as a tool to get more departments included to do what you need them to do on time. The third one nevertheless was the real surprise and the most valuable.

I vividly keep in mind the good old days when we had the much better part of 10 working days to get it done. I likewise know what it resembled when the memos would show up that demanded yet another day be cut. I remember the objections and complaints by myself and my counterparts. It made no sense because all it implied was less precision and more changes and estimates, or so it appeared at the time.

If your close takes longer and you are waffling on precision as your reason, then you require to have another look and, if needed, get some aid.

One of the very first things I was told when the walls began to come in on our monthly close was, ” Do a month-end schedule.” Prior to this, we had a timeline so to speak, but the schedule was different. It required that it be interacted to the other supervisors in composing and it also had a “get the other managers more involved in the procedure” tone. Items like billing cut-offs, accrual submissions, inventory schedules, GL evaluations, draft financial statement approvals, commentary submissions, were simply a few of the products that we included that linked others.

What I learned from getting the screws put to us was incredibly valuable and it is most likely not what you are thinking. If you are questioning how, we did this miracle accomplishment and what I discovered, read on.

And, to sum things up, when you look seriously at the monetary procedure you undertake by doing month-end it really does not add any worth unto itself. When we can provide much better more prompt and valuable information from systems and procedures that are efficient and work well, the genuine enhancements and value get developed. Dealing with the planning and execution enabled more time to get it best to begin with, type of why you actually require to have a schedule and simply get it done faster and better.

When executing a month-end schedule, it is critical to devote yourself and your team to make your crucial dates to the wider hotel management team. Things like AP cutoff, GL initial reports, last flash, accruals reversed, earnings complete and reserved, pre-paids total, previous duration adjustments booked, draft financials, and the last P&L. It is a lot harder to merely change the timeline when others are looking, and an element of higher accountability emerges.

Time. My group and I were no longer investing two-plus weeks closing the books and doing the forecast and commentary. We now had it performed in less than one week and we all had so much more time to do whatever else that never ever seemed to get done. All those special projects that never ever end and things that continuously required fixing just got a 50 percent increase in the available time because we were not closing the books for two weeks.

Gradually, month after month, we improved at appreciating the schedule and we likewise used the schedule to tighten up things up so we could fulfill the ever-decreasing schedule from business.

We focused on what the actual calendar looked like for the following month, getting ahead of the weekends and especially any holidays. In addition, we were constantly looking for opportunities to get things done much faster.

In the accounting world, quickly is good but precision is what counts. Understanding we had tight timelines implied more cut-offs and adjustments for things like billing submissions, inventory counts, and we likewise needed to integrate in time for the correct evaluation and a buffer for repairing what went wrong. I can keep in mind some really late nights and weekends that got compromised but come hell or high water we had to make the corporate dates, no negotiating or forgiveness here.

Read more posts from Hotel Financial Coach

The real enhancements and value get developed when we can supply much better more prompt and valuable information from systems and procedures that are efficient and work well. Working on the planning and execution permitted for more time to get it right to start with, kind of why you actually require to have a schedule and simply get it done faster and much better.

I vividly remember the good old days when we had the much better part of 10 working days to get it done. We now had it done in less than one week and we all had so much more time to do everything else that never seemed to get done. All those special projects that never end and things that continuously needed repairing simply got a 50 percent increase in the readily available time due to the fact that we were not closing the books for two weeks.