February may be the shortest month, but it has no shortage of holidays and other big occasions. In addition to Valentine's Day, an age-old celebration with roots in the Roman festival of Lupercalia, there is President's Day and Black History Month, as well as quadrennial events such as leap day (Feb. 29) and the early U.S. presidential primaries and caucuses. To top it all off, the Super Bowl now regularly falls in early February, providing a unique spectacle during some of the coldest weather of the year in the Northern Hemisphere.
Back in 1999, February also saw the release of "Office Space," a film that did not do well in its initial box office run but still became something of a cult classic in the ensuing years. The movie skewers the trials and tribulations that office workers everywhere often run into, and it really puts the spotlight on IT and accounting issues in particular:
- For example, a desk printer belonging to the fictional company Initech malfunctions so badly that it drives a few employees to just take it out into a field and smash it up.
- There is also an annoying phone tree (where you always hold for "just a moment") that must be navigated by anyone calling the Initech hotline.
- Perhaps most famously, Initech employees must regularly submit "TPS reports," implied to be sets of laboriously assembled busywork that must also bear specially formatted cover sheets, to their supervisors.
- At the same time, its accounting system is hardly first-rate. It's hard to work with and it lacks even basic protection from unauthorized manipulations that would make all of this micromanaging somewhat pointless.
The pre-Y2K technological environment of "Office Space" may look like ancient history now, with all of its huge CRT monitor PCs and lack of touchscreen devices. But the reporting culture that it relentlessly makes fun of with those TPS reports is still very much alive and well in many accounting departments. Their respective organizations are still reporting like it is February 1999, which is bad news for the accuracy, risk level, cost and overall efficiency of their financial processes.
Trapped in the 'Office Space' cubicle: What is the price of retro accounting practices?
The best spin someone could put on the infamous TPS reports from "Office Space" is that they are accountability mechanisms, offering insight into who is doing what and when. Businesses of all stripes have their own ways of keeping tabs on the organization as a whole. Unfortunately, many of these approaches to reporting and accounting are, in practice, as time-consuming, tedious and counterproductive as what Initech employees had to fill out throughout the movie.
To understand where today's reporting methods fall short, we have to understand the numbers and tools that so many accounting departments routinely work with. They generally track performance against two main classes of metrics, using Excel, QuickBooks and/or various custom solutions:
This category includes income statements and balance sheets, along with figures for deferred revenue and days sales outstanding. All of these are universal metrics (across for-profit and nonprofit institutions), which are tightly controlled for accuracy, completeness and timeliness.
Under this banner, we find more company-specific data such as operational metrics that measure the success of current strategies and operations. They may include expense breakdowns by service offerings (for service organizations), funding per program (for nonprofits) and profit and loss statements for on-prem compared with cloud solutions.
Tedious reporting is a central part of the "Office Space" plot.
The challenges of simultaneously tracking both types of metrics
Already, we can see how juggling these two types of metrics can create challenges. Whereas financial metrics are universal and more or less constant over time, business metrics are particular and always in flux. Transported to the present day, an Initech employee from "Office Space" would probably recognize the company's (increasingly distressed) balance sheet, but the firm's operational numbers would likely look a lot different, since many new projects would be in play, each with its own set of metrics.
Classic accounting practices only make matters more complicated:
- Finance teams end up having to do weird things with their charts of accounts.
- For example, they have to add a bunch of custom fields and labels, so that they can pull relevant reports on given data sets.
- Information also gets shuffled between business intelligence applications, spreadsheets, etc., which leads to staleness, not to mention the risk of an error during transfer.
- The various external tools in the mix may each require special expertise, which creates additional bottlenecks as teams look for the right person to perform certain tasks.
- Along the way, accountants can become overly dependent on IT to troubleshoot any technical issues and upgrade both software and hardware assets.
There are too many hoops to jump through here, and the potential cost to the organization is enormous. "Office Space" demonstrated what can happen when such overly complex processes intersect with ever-shifting business requirements and faulty IT infrastructures.
"There are too many hoops to jump through with legacy accounting."
In fact, one of its central plot points is the infection of Initech's accounting system by a computer virus designed to "salami slice" extra money into a few employees' accounts. The transactions are meant to be so small that no one would ever notice. Factoring in all of the time and money that Initech put into the sideshow of TPS reporting, it's easy to see why the scheme's perpetrators never got caught.
Initech's situation was the result of both technical and cultural issues. The company would have benefited from a more streamlined approach to reporting, supported by more modern accounting tools.
Don't party like it's 1999: Upgrading your accounting system with cloud financial software
What if you could report on both your financial and business metrics from within the same system? Such a setup would save plenty of time and also help your firm avoid common setbacks, ranging from the glaring oversights that plagued Initech, to the smaller data entry errors that still prevent so many firms from closing their books on time each month.
Cloud financial management software is the best way to accomplish these goals and ultimately better understand and manage what is most important to your organization. A solution like Intacct simplifies normally complex reporting processes, giving accountants the ability to track universal as well as unique metrics, and also work with information in real time. The middlemen of complicated tools, isolated data and unreliable infrastructure no longer stand between finance teams and what they need to compile accurate reports.
Another way of looking at it is as an escape from what Intacct vice president Clark Newby once creatively called "the seventh ring of Excel hell." It provides relief by offering:
- Readymade report templates, alongside setup fields that allow the application to be configured and customized in ways that best suit the organization's current requirements.
- Options for financial, on-demand and custom reports, all available from a convenient self-service interface.
- A dashboard that provides quick insight into anything from a standard income statement to a graph breaking down revenue per entity or the demographics of customers.
- Easy drill-down capabilities that let workers dive into general ledgers to find source documents such as invoices.
- Seamless automation and integration of financial processes, which lowers the risks of making mistakes or falling behind schedules that are so prevalent when doing everything the old-fashioned way.
Tapping into the power of cloud financial tools lets finance teams stay on top of the full range of metrics that are relevant to their firms, with excellent reliability, accuracy and cost-effectiveness across all of their key processes. They can eliminate the traditional need for bespoke, isolated approaches to different types of metrics, and move from the TPS report-style tracking that should have gone out of style the same year that "Office Space" was originally released.