Integrating Time Tracking with Financial Systems
In my previous post, I wrote about the benefits of integrating time tracking with your accounting system. To give you a quick recap, here are those three main benefits:
- Expedited system stand-up
- Easier time tracking
- Better, more accurate data
Ultimately, the adoption of any integrated systems project is going to profit the organization in the same way by enhancing speed, accuracy and efficiency of processing data by serving as a one-stop shop for all your information. FASTER & BETTER are buzzwords I think we’re all familiar with!
But how would an integration of your time tracking system with your financial systems provide you with better reporting capabilities? Faster WHAT? Better HOW?
Improved Insights & More Accountability
A centralized database or reporting system allows for well-timed insight into the metrics needed to measure the company’s performance.
The timeliness of financial reporting is such a critical issue that it is one of the six qualitative characteristics of effective financial reporting by the Governmental Accounting Standards Board. The GASB noted that, “If financial reports are to be useful, they must be issued soon enough after the reported events to affect decisions. Timeliness alone does not make information useful, but the passage of time usually diminishes the usefulness that the information otherwise would have had.”
An integrated system standardizes procedures for recording transactions, like time and expense records, and distributing financial information. It unites the reporting activities of different functional areas of your business and streamlines the information input and output; eliminating the need for supplementary procedures. By integrating financial reporting systems with a time & expense tracking system, businesses can consolidate financial and operational data into a single platform for reporting, planning and decision-making.
What does this mean for the company? Decisions by management can benefit from the enhanced accountability with up to date, in-depth reports on operations; while financial planning and forecasting can rely on summarized data from across the enterprise.
System & Process Longevity
Investing in a new software system is a steep venture. First there’s the research, then sales and implementation processes that can easily last 2 years – and that’s on top of the cost of the actual product!
One of the biggest lessons I’ve recently learned while leading our own internal time tracking upgrade is, generally, sub-systems that are not part of the mainstream business process become misaligned from the bigger picture. The auxiliary system tends to last only if the administrator who built it continues to support it and or the system of record remains the same, otherwise support begins to wane and eventually dies. Also, when the data source systems are significantly upgraded or modified, any informal links feeding the time tracking system become broken and nobody knows how or why the system functions the way it does.
Eventually, the time tracking process doesn’t line up with financial reporting requirements and records (and the system!) are either too vague or too detailed to be useful.
It doesn’t have to be that way though. By investing in integrations of your time tracking and financial systems, you can protect your interests and ensure a collaborative, interdependent, long-lasting relationship between your time tracking and financial reporting system.
When you get down to brass tacks, there really isn’t a good reason NOT to integrate your time tracking systems with your other key business systems. By doing so, the benefits will outweigh the costs many times over in the form of saved time and clearer financial insights.
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Journyx helps you track time for projects, payroll, and more. Learn how Journyx can help you use time to your advantage in your business.