Summary: Robin Kelley and James Jumes, partners at AAFCPAs, will present and discuss ways in which technology may be used to gain efficiency and internal control in major business processes. Improvements and thoughtful implementation of technology solutions have the ability to reduce process costs, increase quality, reduce the number of errors, reduce the risks of fraud and more. Attendees will be able to:
- Better understand how technology can be used to accomplish greater process efficiency, effectiveness, and internal control.
- Learn how to get started, plan for, and implement technology solutions.
- Learn the key considerations and the benefits.
Write-up from the session:
Robin Kelley and James Jumes, partners at AAFCPAs, presented and discussed ways in which technology may be used to gain efficiency and internal control in major business processes. Improvements and thoughtful implementation of technology solutions have the ability to reduce process costs, increase quality, reduce the number of errors, and reduce the risks of fraud and more. Robin and James presented ways to better understand how technology can be used to accomplish greater process efficiency, effectiveness, and internal control; discussed how to get started, plan for, and implement technology solutions; and covered the key considerations and the benefits.
When is a good time to assess using technology to enhance operational efficiency and the effectiveness of internal controls? One occasion is when the organization is going through a rapid growth. Others are when your current financial system is old or when your system’s existing capabilities are not being fully utilized. Changes in regulations, a slow system in place, and inefficiencies in internal controls are all occasions to assess technology improvements. When thinking about improvements to make, look at your major business processes for areas of opportunity. First look at the purchase to pay cycle. Maybe you could use electronic purchase orders. Next, consider workflow technology – approvals don’t have to be in paper format. Next look into ACH (automated clearing house – electronic bill pay) and EFT (electronic funds transfer) to reduce paperwork. You can also use Positive Pay to send the bank a list of epays, and you can request debit blocking, to make sure that no one is withdrawing funds from your organization without proper authorization. All of these measures involve the use of software, sometimes through the cloud or sometime you can use your internal server.
Another area that you can use technology to increase efficiency is in the area of payroll and human resources. For payroll, use can use workflow technology, direct deposit, debit card/pay card, positive pay, and electronic timesheets. Electronic timesheets need to integrate with the payroll system that you are using and with your financial system. When assessing financial operations, you should do a flowchart of your current systems to look for inefficiencies and bottlenecks. Some options are to use automatic allocations and check scanning for bank deposits. It is very important for new systems to integrate with each other. Increasing reporting efficiencies will help management get information to program managers in a timely manner.
When making major technological changes and upgrades, there are some key considerations. First, since everyone is probably already very busy, hire an outside consultant to plan and implement the changes. Next, some management staff that are resistant or oppose the changes may have to go or be transferred. Also, you will have to manage the expectation of the users, the executive team, and the Board of Directors. The IT department should not be the driver of these changes. You need to determine what the management team wants to get out of any new system, and then look at software solutions. Examine your business processes – walk through them with everyone who has a stake in them. Look for opportunities to make the processes more efficient. You may have to balance the need for internal controls with the need for efficiencies – they are not always the same. For successful implementation, you will have to appoint a process owner and facilitator, with an outside consultant providing a “third party push.”