6 Steps to Master Finance Tech for Small and Midsize Companies

Having worked in finance for multiple different companies, I’ve never understood why so many processes are time-consuming and done manually. Imagine a typical finance department: piles of paper, the sound of stamps and printers, someone standing at the scanner. 🖨 Not only is it all a huge waste of paper, but manual data entry is a significant time-waster too. The main problem (aside from giving the finance team headaches) is long monthly closures that result in late financial reporting, which influences how a business functions. How do you manage a fast-growing company if your numbers take 2–3 weeks to finalize? Well, our finance team vision at Mews is to ditch monthly closures completely. Imagine having your revenue results reported immediately and seeing the costs in PowerBi dashboards as they occur. All paperless of course. Every automation starts with a tech stack, so lets deep dive into ours. No need for expensive enterprise solutions or deep coding skills.

1. Set up the heart of financial operations: the accounting system

Accounting software plays the most important part in the whole stack. We love Xero as it doesn’t strike fear in non-accounting people. It’s very simple for anyone in the company to look at invoices issued to customers and check payments and amounts. It also has super helpful import/export features (we use our own subscription tracking solution within Mews, so all monthly bills are simply imported to Xero each month without any “clicking” required). We are big fans of the bulk change feature called “Find and recode”, super easy bank reconciliation, direct bank feeds, and the huge amount of possible integrations.

We also love Zapier at Mews and, in the case of finance, it’s helping us with new client creation and invoicing, but also with receivable collection automation.

Unfortunately, not all operational cases can be handled by Xero at this point. We wanted to make sure our team doesn’t spend time on manual entry (not only finance specialists but anyone in the company submitting expenses) and also that all bills are appropriately checked and approved (without stamps and signatures of course 😉), so we had to look further.

2. Ditch manual data entry: the “pre-accounting” tool

So, we discovered ReceiptBank. There are other, similar tools on the market, but only ReceiptBank can process bills and also manage expense reports. It’s a pre-accounting tool which, in simple terms, means it can automatically extract data from bills (that can be submitted via email or simply photographed) in order to eliminate all manual data entry and the mistakes it causes. Incoming bills are simply sent to ReceiptBank, quickly checked by the team (descriptions or cost centers, unfortunately, can’t be 100% automatically filled in yet 🤔), then passed on for approval.

3. Ensure approvals electronically: the approval workflow system

ApprovalMax is our tip in this case. They’re a Xero partner adding additional approval functionality on top of the existing Xero approval feature. We haven’t seen this kind of flexibility in approval chain settings anywhere else and really love this tool. Depending on the type of cost or its amount we can assign the right people for electronic approval, which can be done easily via the mobile app (even when people are traveling). With final approval, the bill gets automatically booked in Xero and sent to payment review. Minimal data input, minimal room for typos and manual mistakes, and all connected via API.

4. Get the data ready for real-time: the ETL (Extract, Transform, Load) tool

Once all the data is in place, it’s time to report it! How many times have we seen financial analysts going to accounting software to export general ledgers into CSV files, then pasting them into an excel spreadsheet with formulas built above this “database” input? Sometimes this even includes data clean-up and pasting multiple data sources underneath each other to consolidate the results of multiple legal entities into one report. Imagine the pain when you find multiple mistakes in the data and you’re stuck creating additional exports and updates to check whether everything has been corrected. But there’s a solution.

Blendo is super easy to set up and a real game-changer for reporting. The magic lies in the creation of your own database (in our case an MS Azure SQL Server) and linking Blendo to it. Blendo then integrates Xero and takes care of pulling all accessible data via the Xero API, then saves it. The great thing about Blendo is that it’s not only for accounting — you can also connect your CRM, ticketing platform, marketing tools, and other software. This makes it possible to instantly and super easily get your own data warehouse and create data sets using all kinds of data without the need to transfer analytics into the accounting tool. Data can be refreshed up to every 15 minutes, so any report connected to this data source is virtually real-time.

5. Analyze and report: the reporting tools

The next step is to either keep using everyone’s beloved MS Excel ❤️ or choose a more intermediate reporting tool such as . I probably don’t need to mention the fact that Excel analysis with an active database connection enabling instant refresh anytime is the best thing ever, so let’s talk more about PowerBi. 🤓

MS PowerBI allows anyone to create a report once and have it refreshed all the time. Imagine your account receivable aging export that you usually create with a pivot table in Excel to quickly check how your clients are (not) paying. With Xero, Blendo, MS Azure SQL server, and PowerBi this only needs to be done once. Afterwards, everyone in the company can check the fresh daily status. Thanks to the CRM-Blendo integration we’re even able to add statistics such as open receivables per account manager or travel cost per salesperson so that the reports are as simple as possible for the team. We’re also using PowerBi reports to track our finance team workload — every morning the whole team gets a Slack message showing the status of the bill/invoices Pipeline in Xero or the count of new clients handled in the past couple of days.

Thanks to PowerBi anyone can create any report in any form including consolidation or custom metrics without having to rely on the built-in reporting features of software providers. We’re able to develop extensive financial reporting that is fresh every day, which saves the finance team’s time and provides shareholders the information they need..

6. Take holidays: the future?

Completely ditching monthly closures will probably still take a couple of years, but we believe that technology will allow finance people to go for stress-free holidays over the first week of a month someday soon. 🏝

For more engineering insights shared by Mews tech team & by our guest:

Originally published at https://developers.mews.com on April 16, 2020.