Year-end: it's time for the tree!

Back in the old days, in late December, the boys in our family would head out into the freezing wet and cold of South West England, wander through the woods around our home and select what looked to us like a tiny, young fir tree. Dad would swing the axe and my brother and I would drag our murdered prize up the hill, cheeks glowing and breath puffing until finally we got the tree into the house, where we stood it up inside an old chicken feeder filled with broken bricks.

At this point my mother would appear, gasp in horror at the stream of mud and needles through the house and then berate my Dad for the fact that the branches were far too spindly, the top of the tree was so high it bent along the ceiling and scold us boys for making such a terrible mess.

Of course an hour or two later we would sit looking at all the gift wrapping glinting in the glow of the fairy lights, the chicken feeder swaddled in red velvet, the baubles hanging under wisps of fake snow on the branches and Mum and Dad smiling at each other once again.

These days my son and I climb into the attic, pull out the cardboard box that houses the artificial tree, perfect in shape and height and spend a happy 30 mins hanging out the lights, icicle baubles, golden bells and red ribbons before placing the final star on the top of the tree. We don’t get the wild woods experience these days but we get the same glow of happiness when it is all dressed and done. What’s the business finance angle to all of this you may be wondering? Ah, yes, I remember it’s meant to be a Christmas analogy about financial year-ends. In the old days of finance, things were messy, original, manual, hard work and often the cause of lots of furrowed brows. It was usually alright in the end of course. That’s the same with traditional ways of accounting, they do work, eventually. And we look back at them fondly. I love to tell my colleagues how when I started work we didn’t even use computers, which somehow makes me smile and feel good.

Modern times are more advanced. Artificial Christmas trees are simpler, quicker and once I get over any misplaced feelings of missing the cold and wet of the forest, I appreciate the thick fronds and branches which make today’s tree look so much better than the semi-naked spruce of yore. No mud, no spindles, no chicken feeder = no arguments.

Computers also make things easier. But there is also another thing that makes for a happier ending, that's the process. Lights first, then big baubles, next small ones, then the ribbons. It works, makes it much more efficient but no less fun. The same is true of a well-honed month-end financial process. If you don’t have a prescribed routine, if everything is just stuffed into a proverbial paper bag through the period and then you need to prepare the month-end accounts manually, the task ahead is huge and discouraging, rather like our tree in the forest at the bottom of the hill.

How about doing things weekly? Why not tidy up each Friday when the past week’s transactions are fresher in everyone’s mind. When you then get to month-end, you only have one week or less of transactions to post and you can focus on the final reconciliations and produce the accounts.

Sounds simple, right? Everyone does this? Wrong!

Almost every company I have started working with did month-end at the end of the month. The howls of frustration when I suggested change, cajoled and coerced the team into weekly soft-closes were rather like the sounds of wolves to the full moon.

The end result is always the same, when finally weekly preparation is accepted. The work is done quicker, easier and much much faster. Most importantly, everyone gets home in time for Christmas. By the way, month-ends are not just for Christmas, to parody a famous advert from the Battersea Dog’s Home.