How Does Real-Time Reporting Work in General Ledder Solutions?

Introduction: The Problem That Is Financial Lag

For years, business leaders have been forced to work with a maddening lack of financial hindsight. Fast forward to the decision and financial data, made in a fast pace world, represented what weeks or even months old — remnant of the time- consuming “month-end close” process. This delay resulted in missed opportunities, unrecognized emerging issues and rearview-mirror thinking.

Real-time reporting in general ledger systems blows this old paradigm away. It is the difference between seeing what happened with yesterday’s weather on a satellite photo compared to looking at a live radar map and watching a storm develop right now. But how, exactly, does this technological gee-whizery work? What turns a slow, batch-processed system into a live source of the truth? The answer is a matter of architectural retooling in terms of integration and processing of data.

The Old World: Batching and the “Close Down” Initiation

To understand why real-time reporting is so valuable, one must first grasp the manual process it obviates. In traditional accounting:

Transactions Take Place: Sales take place, bills are sent out and expenses are created throughout a period (month or quarter).

Data is Derived Manually: Data is manually gathered from a variety of other sources—paper invoices, spreadsheets, bank statements and reports from other departments.

Enters Data in Batches: The entry-level accountant with a college degree keys this batched data into a computerized accounting system, usually at the end of the week or month.

Mistakes are Reconciled: The painful process of reconciliation hits the ground running— upon traces for mistakes, missing data and code errors.

Financials are "Closed" - Financial statements aren't deemed final and closed for the period until every fact is in and tied out.

It is this very mechanism that produces a built-in lag in the information content of the financial statemen t and turns it into a history book, rather than a tool for managing going forward.

The Architecture of Now: How Real-Time Reporting Works

Real-time reporting isn’t just a feature; it comes from an integrated technological architecture. Here are the key ingredients that enable it:

A Unified, Single-Source Database

This is the most important factor. The general ledger is one of the modules in a product like Intersoft ERP. It constitutes the heart of a single, integrated platform in which all business functions – sales, inventory, orders, purchasing and payroll are managed on one consistent database. There's no "syncing" with different systems. When a transaction is concluded in any module, it is instantly recorded on the central database. The general ledger need not be updated, it is always current as part of a same data cloth.

Transactional Processing, Not Batch Processing

Not waiting to group data together, a real-time GL processes each business transaction one at a time as it occurs. From the time a sales invoice is created, the system:

Debit: Accounts Receivable Credit: Revenue (Immediately upon selling and delivering the goods.)

Real-time entry of Inventory Asset & COGS accounts.

Refreshes all related reports and dashboards at the same time.

This real-time, transact-by-transact bookkeeping means that the ledger’s balance is up-to-date to the second.

Direct System Integration and Automation

Manual data entry does not allow for real-time reporting. It depends on deep, programmable integrations:

Bank Feeds: Transactions come straight from the bank into the GL, tagged for reconciliation.

AP Automation: Image supplier invoices, route for approval and upon approved post to GL/P&L without any manual interaction.

POS & eCommerce Integration: All of your sales, refunds and gateways payments post to the correct income and cash account in real-time.

This overcomes the data-entry bottleneck and its associated delays.

In-Memory Computing and Powerful Processing

Today's GL solutions are based on a high-performance service model using a powerful in-memory server. This is because the full dataset or significant subsets of it lives in the server's RAM rather than being on slower spinning disks. The data loads and calculates itself so quickly that the most complex reports and dashboards refresh faster than you can click a button, even with millions of data points.

Dynamic Reporting and Dashboard Engines

The front-end reporting facilities are reporting directly off the live database using secure quries. When you click on a dashboard or run a report, it’s not looking at some static, pre-generated file. This is running a an active query against the current database. This implies you see the Profit and Loss statement at 3:05 PM is including just closed sale at 3:04 PM.

A Real-World Example: Observing Real-Time Reporting in Use

Picture a countrywide retail chain operating on Intersoft ERP:

2:00 PM A customer in Miami buys a $150 jacket on a credit card.

2:00:01 PM: The POS system processes the purchase. Immediately, that central database is updated:

The jacket count is decremented by one in Inventory module.

The posting is done in General Ledger simultaneously:

Debit: Accounts Receivable (or Cash) rises by $150.

Credit: Sales Revenue $150 increases by.

Debit: Cost of Goods Sold (jacket cost)

Credit: Inventory Asset is reduced in the same amount.

2:01 PM: In her corporate office, the CFO refreshes her live dashboard. She sees:

LATEST: The sliding ticker readout of company-wide revenue is up $150.

The Miami store’s daily sales figure has been refreshed.

The 2009 gross margin for the apparel division has been restated.

The SKU of that jacket has a lower value in inventory.

And, remember, a transaction being executed to an executive’s insight of business measures for example is end to end without manual work; providing the highest degree of operational and financial understanding.

Intersoft ERP – Why RealTime Because it is in its Nature

Many systems tout real-time reporting, but the patched-together nature of such solutions —connecting multiple independent apps through fragile APIs — also tends to lead to micro-delays and sync issues.

Intersoft ERP is designed right from the beginning to operate always in real-time. And because ours is a native unified platform, we don’t have an “integration layer” that may impede or corrupt the traffic. Real-time reporting is a first-class citizen of this system, not an afterthought. And our robust tracking by dimension means you can cut up this live data not only by account, but also by project or department or location or salesperson — anytime for real-time insight into itself – the money-making and losing machine you call your business.

Explore our General Ledger Software features, benefits, and use cases.

Conclusion: Historical Record and Strategic Compass

Real-time reporting changes the general ledger from an old shoebox of history into a living tactical GPS. It empowers businesses to:

Think proactively, not in terms of old assumptions.

Detect patterns and problems as they develop so you can act quickly.

Enhance Cash Flow Control Monitor receivables and payables in real-time.

Enable department managers to have up-to-the-minute budget-to-actuals for their departments.

Nowadays, in the fast running business world we live in having a clear view of your financials at any given point is no longer a privilege but rather a basic necessity to compete effectively. By investing in a system designed with real-time reporting in mind, you provide your business with the clarity and agility required to not only respond to the market, but drive its future.

Please visit Intersoft ERP and book a free demo.