If your team dreads the end of every reporting period, you’re among the many. The financial close process, whether monthly, quarterly, or bi-annually, is one of the most important and most stressful responsibilities for any accounting department. But when it’s plagued by inconsistent data and incorrect postings causing a lot of manual work and delays, that stress multiplies fast.
At Stellar One, we help businesses streamline their financial close with every ERP platform implementation, reducing frustration, improving accuracy, and helping teams spend more time analyzing results instead of chasing them.
In this article, you’ll learn the five most common problems that slow down financial close processes, including:
- Incomplete or unposted transactions
- Disconnected systems and data silos
- Poor policy alignment and communication
- Manual reconciliation and data entry
- Reopening closed periods
We’ll then cover why these issues happen, how they affect your reporting accuracy, practical ways to fix them, and whether that fix should take place through better policies or smarter systems.
By the end, you’ll know exactly where your close process is breaking down and what steps you can take to make it smoother, faster, and more reliable.
Financial Close Problem #1: Incomplete or Unposted Transactions
One of the most frequent problems in the financial close process, especially during a month-end or quarter-end close, is missing or unposted documents.
Late accruals and missing and unreleased purchase receipts, shipments, invoices, and payments can throw your balances off and delay reconciliation. When teams rush to catch up, mistakes multiply, and accuracy suffers.
How to fix it:
Establish clear posting deadlines and ownership for every department. For example, set a firm cutoff for expense submissions and vendor invoices a few days before your month-end or quarter-end close. Then, ensure accounting verifies and posts all documents before beginning reconciliation.
Financial Close Problem #2: Disconnected Systems and Data Silos
If finance relies on spreadsheets while operations uses another system and sales uses yet another, you’re already behind. When data lives in multiple tools that don’t communicate, your team can spend hours reconciling transactions that should match automatically.
These silos lead to delayed closes, reporting discrepancies, and higher risk of error. Studies show that 94% of business spreadsheets contain critical errors, meaning even the best manual system can’t keep up long-term.
How to fix it:
Start by integrating your most critical systems, like accounting, accounts receivable, accounts payable, and warehouses, so that data flows automatically. Over time, evaluate whether a more unified platform, such as an ERP system, could reduce the friction entirely.
Financial Close Problem #3: Poor Policy Alignment and Communication
Even with the right tools, inconsistent policies can create chaos. One department may post transactions daily, another weekly. Sales and Purchasing may hold posting documents while accounting is trying to close the month. The result? Confusion, rework, and sometimes even reopened periods.
In many cases, these circumstances come down to a leadership and discipline problem more than a technical one. Without clear communication and accountability, even good systems can’t prevent bottlenecks.
How to fix it:
Document your close process and define who owns each step, including posting, reconciling, reviewing, and approving. Make sure all departments understand and follow the same policies for timing and data accuracy.
A short check-in between finance, operations, and leadership before each month-end or quarter-end close can catch most issues early, saving days later on.
Financial Close Problem #4: Manual Reconciliation and Data Entry
When everything is reconciled manually, errors are inevitable, and the process takes exponentially longer. Manual reconciliation can include copying bank data into spreadsheets, matching transactions line-by-line, and adjusting entries after close.
These tasks create opportunities for mistakes that impact financial accuracy and team morale. As a result, accountants spend more time fixing numbers than understanding them.
How to fix it:
Do your best to automate wherever possible. Recurring transactions setup, direct bank statement imports via bank feeds, and well dialed-in mapping and reconciliation tools save time and reduce human error. If automation isn’t an option yet, build standardized templates and checklists to guide the process.
Automation doesn’t replace accounting, but reinforces it by making the right thing the easiest thing to do.
Financial Close Problem #5: Reopening Closed Periods
Nothing derails confidence faster than reopening a closed period. It undermines accuracy, introduces audit risk, and forces teams to redo work. Unfortunately, it happens often, usually because transactions were missed or adjustments weren’t made in time.
Each time a period is reopened, financial reports need to be produced yet again. Other areas such as commissions and sales tax reporting need to be amended as well. This process not only wastes time but can also create confusion with stakeholders and leadership and affect their ability to make sound financial decisions.
How to fix it:
Create strong cutoff policies and require management approval to reopen any period. In certain ERP systems, period locks can prevent unauthorized changes once a close is complete. Consistent enforcement builds trust in your data and your process.
What’s the Real Cost of a Broken Financial Close Process?
All of these problems share one thing in common: They cost time, accuracy, and peace of mind. A slow, error-prone financial close will frustrate your accounting team and impact leadership’s ability to make timely decisions. Additional costs include inaccurate budgeting and forecasting, plus the potential inability to pass a public audit, which can impact funding.
The amount of time to clean these messes up in the future can become prohibitive in any business doing what it wants to do moving forward.
When your financial data isn’t current, your strategy can’t be either.
How Can You Achieve a Smarter, Simpler Financial Close?
The financial close process, whether monthly, quarterly, or bi-annually, will always be important. But it doesn’t have to be painful. With clearer policies, better communication, and more connected tools, your accounting team can turn the close from a recurring scramble into a well-run routine that supports faster insights and smarter decisions.
If your current process feels like a marathon, it might be time to reassess how your systems and workflows support you or hold you back. Small improvements now can save hours later, and even pave the way for automation when you’re ready.
At Stellar One, we help growing companies simplify their business processes by implementing Acumatica, a cloud-based ERP platform. That means refining workflows, exploring integrated systems, and oftentimes eliminating manual steps altogether. The result? Faster closes, fewer surprises, and a team that can finally focus on the bigger picture.
Click below to take our quiz and find out whether an ERP platform is the best next step for fixing your financial close and helping you simplify and grow your business.
