Manual finance processes cost firms 44 hours per week

Research by Unit4 has identified that professional services firms are losing considerable time and resources due to shortcomings in their financial systems and manual processes.

The findings are based on the second part of Unit4's international research study, "The Back Office in 2025", conducted by research consultancy Vanson Bourne. The study examined the pressures faced by senior finance and IT decision makers in handling financial operations across professional services organisations in multiple regions, including the UK and Benelux.

According to the report, all surveyed decision-makers encounter discrepancies in year-end financials, with a significant majority (77%) indicating that these issues arise frequently. These financial discrepancies result in wasted time, as firms spend extensive hours investigating errors, consolidating financial information, and undertaking manual processes.

The research reveals that, on average, 44 hours a week are consumed by activities related to financial discrepancies, and finance leaders spend two days per week specifically on year-end financials. Project financial management is similarly taxing, with 25 hours per week devoted to investigating project finances and an additional 19 hours spent correcting or updating related issues.

The burden is particularly high in the UK and Benelux, where over 50 hours per week are expended on these tasks. The strain is also more pronounced among management consulting firms and smaller organisations, where wasted time increases further.

The study highlights three principal challenges contributing to year-end discrepancies: time-consuming manual processes, lack of integration across systems, and difficulties consolidating financial accounts. This situation has a tangible effect on employees, with 61% stating that year-end reporting negatively impacts the wellbeing of finance teams and 73% noting that a reduced year-end workload could help prevent burnout.

Bryce Wolf, Strategic Growth Director at Unit4, commented, "At a time when productivity and efficiency are bywords for every Professional Services firm, these findings reveal concerning shortcomings for organisations that want to be more competitive. The firms that drive greater consolidation of financial information will be closer to gaining a single source of truth about their business performance. Combined with greater automation to aid faster decision-making, this will be critical to survival and growth in the years ahead."

When it comes to project financials, participants identified high costs associated with new solutions, a lack of real-time data insights, and fragmented or inconsistent data records as the leading obstacles in achieving improvement. The research suggests that manual processes persist despite the clear potential for automation; 84% of finance teams are reportedly spending excessive time on tasks that could be automated.

Within cash flow management, manual handling of payment reconciliation, approval workflows, and data consolidation and integration are reported as particularly susceptible to inefficiencies. As a result, 88% of respondents describe cash flow management as difficult. The primary reasons cited include inadequate reporting tools, cumbersome approval processes, and high operating costs. These factors are linked to rising processing times, increased operational expenses, and an increased risk of errors.

The study indicates that automation could address many of the sector's challenges. Globally, 48% of respondents believe that tracking and managing project expenses would be improved through automation, while 47% point to benefits in cash monitoring and optimisation, as well as creating financial forecasts. However, only 46% of cash flow management processes are currently automated. Within subsectors, management consulting (49%) expresses the highest intent to increase automation, followed closely by IT and tech (48%) and media and publishing (46%).

There is broad consensus on the importance of further automation: 92% agree it would accelerate the consolidation of year-end financials. The research also identifies that greater integration of back-office systems and increased automation are priorities to overcome current challenges, with 73% indicating that a lack of a single source of truth for financial data is an ongoing issue.

Respondents indicate that finance systems could be further strengthened with the use of AI-enhanced features (93%), integration of financial management tools within an ERP system to improve collaboration and decision-making (92%), and third-party partnerships to optimise cash flow management processes (90%).

The view among participants is that implementing these improvements would enhance the accuracy of financial decision-making, reduce workloads, and enable teams to dedicate more time to strategic growth activities.