Why Large Enterprises Are Rethinking Finance and Accounting Services
In today’s fast-paced business environment, large enterprises are increasingly reevaluating their finance and accounting services. The evolution of these services, including key processes such as procure to pay (P2P), record to report (R2R), and order to cash (O2C), is helping businesses eliminate inefficiencies, strengthen compliance, and gain a competitive edge at scale.
Why Large Enterprises Need Specialized Finance and Accounting Services
Managing finance and accounting services in large enterprises differs significantly from handling it in mid-market companies. As organizations scale, every process gap compounds, potentially causing delays, strained supplier relationships, missed discounts, and cash flow distortions. Efficient management of finance and accounting services is critical in mitigating these challenges, especially for enterprises.
Large enterprises face unique pressures that generic finance and accounting services cannot address:
Multi-Jurisdictional Compliance: Enterprises operate across multiple regions, with different tax codes, reporting standards (GAAP, IFRS), and regulatory frameworks.
Volume at Scale: Enterprises process thousands or millions of transactions monthly, making manual processes ineffective.
Interdependent Systems: Integrating systems like ERPs, CRMs, and treasury platforms is essential to avoid financial reporting delays.
Board-Level Scrutiny: CFOs must deliver real-time financial insights, which requires a faster month-end close cycle.
Fraud and Risk Exposure: Increased transaction volumes create greater risks, requiring compliance with Sarbanes-Oxley regulations.
Strategic Resource Allocation: Finance teams should shift from transactional work to strategic activities like capital allocation or M&A analysis.
Partnering with specialized finance and accounting services providers enables enterprises to overcome these challenges without expanding headcount, often at a fraction of the cost of in-house teams.
Financial Accounting Services: The Strategic Foundation
At the core of any high-performing enterprise finance function lies financial accounting services that ensure accurate tracking and reporting of every dollar. These services serve as the foundation for generating strategic financial intelligence. For large organizations, financial accounting services typically include general ledger management, accounts payable and receivable, bank reconciliations, fixed asset accounting, intercompany accounting, tax compliance, and statutory reporting.
A key example of the complexity involved in enterprise accounting is intercompany accounting. For a global enterprise, hundreds of intercompany transactions may need to be processed daily, each requiring correct alignment during consolidation.
Industry benchmarks reveal that top-performing enterprises close their books in 4.8 days, compared to the median of 6.4 days. This 1.6-day advantage allows for faster decision-making and more efficient capital allocation.
Technology-Enabled Financial Accounting
The best financial accounting services today are powered by technology. Cloud-based ERPs, such as SAP S/4HANA, Oracle Cloud Financials, and NetSuite, handle transactional data, while analytics tools like Power BI and Tableau convert that data into actionable insights. Robotic process automation (RPA) speeds up high-volume tasks like invoice processing, while human expertise focuses on judgment-based activities like variance analysis.
Accounting Services in New York: The Epicenter of Enterprise Finance
New York City is a hub for financial accounting services. The city's market provides unmatched access to enterprise finance talent, regulatory expertise, and a dense financial services ecosystem, offering a strategic advantage to enterprises headquartered or operating here.
New York's enterprises are subject to regulatory requirements from the SEC, FINRA, and other bodies, making specialized accounting services in New York crucial for compliance. These services are tailored to industries like finance, healthcare, media, and technology, each with its own set of accounting standards and disclosure requirements.
The Procure to Pay (P2P) Process: Turning Spending Into a Strategic Lever
The procure to pay (P2P) process is vital for controlling costs, managing supplier risk, and improving cash flow. P2P connects purchasing with finance through a disciplined approval system, ensuring real-time spend visibility, supplier contract compliance, and maximum cash flow benefit.
Steps in the P2P process include:
Purchase Requisition: An employee submits a purchase request, including a budget code and justification.
Purchase Order Creation & Approval: The procurement team validates the request, selects a supplier, and generates a PO.
Goods Receipt: The receiving team confirms delivery and quality.
Invoice Processing & Three-Way Match: The supplier’s invoice is matched against the PO and receipt.
Payment Execution & Reconciliation: Payments are made based on agreed terms, and bank reconciliation closes the loop.
To optimize the P2P process, enterprises need to implement eProcurement catalogs, AI-powered invoice data extraction, and intelligent exception routing to eliminate bottlenecks like maverick spending and invoice discrepancies.
The Record to Report (R2R) Process: Compressing the Close, Expanding the Insight
The record to report (R2R) process ensures that financial transactions are accurately recorded and reported in a timely manner. With compressed close cycles and accurate reporting, enterprises can make faster decisions and mitigate risks.
Steps in the R2R process include:
Transaction Recording: Financial transactions are captured in the general ledger.
Period-End Accruals & Adjustments: Necessary adjustments are made, such as accrued expenses and depreciation.
Account Reconciliation: Each balance sheet account is reconciled to source documents.
Consolidation & Intercompany Elimination: Legal entities’ financials are consolidated, and intercompany balances are eliminated.
Financial Reporting: GAAP/IFRS financial statements are prepared for external filing.
Modernizing the R2R process with automation can reduce the close cycle from 10+ days to 5 or fewer. Tools like Blackline and Trintech streamline reconciliation, ensuring quicker and more accurate financial reporting.
The Order to Cash (O2C) Process: Accelerating Revenue Realization
The order to cash (O2C) process is crucial for converting sales into cash. Efficient O2C performance enhances cash flow and reduces Days Sales Outstanding (DSO), which directly impacts the enterprise's working capital.
Steps in the O2C process:
Order Management: Customer orders are validated for credit and product availability.
Credit Management: Customer creditworthiness is assessed before order fulfillment.
Fulfillment & Shipping: Products are shipped, triggering revenue recognition.
Invoicing & Billing: Accurate invoices are generated.
Collections & Dispute Management: Proactive efforts are made to collect payments.
Cash Application & Reconciliation: Payments are matched to open invoices, completing the O2C cycle.
Improving DSO by just five days can unlock millions of dollars in cash for investment, growth, or debt reduction. Using AI-assisted cash application and proactive collections workflows helps reduce the time it takes to collect payments.
Integrating P2P, R2R, and O2C: The Connected Finance Enterprise
The P2P, R2R, and O2C processes should be managed as interconnected workflows rather than separate silos. Delays in one process can affect others, creating inefficiencies across the financial function.
Enterprises that integrate these processes effectively, using shared data and integrated technology, outperform those that treat them independently. A unified finance function enables CFOs to make informed, data-driven decisions in real-time.
Choosing the Right Finance and Accounting Services Partner
When selecting a provider for financial accounting services, ensure they have experience in large, complex organizations. Evaluate key criteria such as:
Enterprise Track Record: Look for case studies from organizations of comparable size and complexity.
Technology Integration Depth: Ensure expertise in your ERP and financial systems to avoid data silos.
Local and Global Reach: Your provider should have regulatory expertise in every jurisdiction you operate in.
Compliance and Security Posture: Ensure they meet SOC 1 and SOC 2 Type II certifications, SOX compliance, and GDPR/CCPA standards.
The ROI Case for Finance and Accounting Services
Outsourcing finance and accounting services can lead to substantial cost savings (25–45%), improved working capital management, enhanced audit controls, and faster financial closure. The aggregate return on investment for a $1 billion enterprise over five years can exceed $20-$40 million.
By transforming your finance and accounting services through strategic partnerships, you can unlock efficiencies that drive growth, improve profitability, and provide a stronger foundation for decision-making.
