Parker Gilbert on Accounting Data Hygiene
In this episode of The Role Forward podcast, our host Joe Michalowski welcomes Parker Gilbert, the CEO and co-founder of Numeric. They discuss the importance of data cleansing, why data cleaning is a timely but worthwhile process, and the benefits of a strong relationship between finance and accounting.
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Parker Gilbert on Accounting Data Hygiene
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No matter your industry, clean data results in well-informed decisions. By keeping your data clean and accurate, you save time from searching for answers and reconciliations and can spend more time diving into the “why” behind your numbers and making actionable insights.
But for companies who experience hypergrowth or need to make a switch to a new source system, how do you effectively clean your company’s data?
In this episode of The Role Forward podcast, our host Joe Michalowski welcomes Parker Gilbert, the CEO and co-founder of Numeric. They discuss the importance of data cleansing, why data cleaning is a timely but worthwhile process, and the benefits of a strong relationship between finance and accounting.
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Parker Gilbert is a Co-Founder and the CEO of Numeric, a SaaS company transforming accounting workflows to modernize the month-end close and other processes. Parker was the first finance hire at Hearth, a fintech company helping home improvement contractors grow and manage their business. Parker also met his fellow Numeric co-founders early in his career.
- Data cleaning is a crucial aspect of data management. If data isn’t accurate, executive leaders won’t be able to make decisions that have a proactive, strategic impact on the company’s financial health.
- Even though data cleansing takes significant time and effort, it pays off in the long run. When companies go through maturation with clean data, the data is able to flow into new accounting and source systems, which leads to faster management in a scalable, repeatable, and trustworthy manner.
- Financial and accounting departments are intertwined, so it's essential they have a close relationship. But these departments also need to know how to collaborate with other departments, especially sales. When departments align on the same goals and find a common language, workflows run smoother and problems are solved quickly.
Episode Highlights from Parker Gilbert
08:18 — The Month-End Close Is a Data Problem
“I think a lot of what we think about is the month-end close being a little bit less of a workflow and compliance process. It is those things, but equally, it’s a data problem, and it’s a question of how do you ensure that these data sets that the accounting team is the owner of, is responsible for, are correct, are up to date, are complete, and not just at sort of an aggregated level ,but also on a transaction level. How do we ensure that vendors are attached to every single expense? How do we ensure that for marketing campaigns, we’re really sort of enriching them with the right data points to ensure that the marketing leaders can use the information that is most useful to do their jobs better?”
27:18 — Take Your Data Cleanup One Step at a Time
“I think the first thing that I would sort of highlight at a really high level is that this should be something that’s iterative, and it shouldn’t be something that is viewed as a project of we’re going to go from having data that’s a mess to data that’s perfect. The world doesn’t work that way, and nor does it need to. And so again, I think getting into a mindset, which is, ‘What are the most important things that we can start to chip away at and where can we start to make incremental improvement in terms of we are improving.’ This sort of data quality and hygiene in systems, I think is super important.”
36:21 — Accounting Should Be Involved in the Company’s Decision-Making Process
“So many of these operational decisions should be happening with more input from the accounting team and from the places where we have real confidence that things of the dollar sign are being counted correctly and processed. And so, if you’re not moving quickly enough and understanding what are some of those more real-time, continuous decisions that are not happening on a clean period-by-period basis — which is sometimes, but not always, the way business decisions work — you’re going to start getting carved more and more out of the loop of like, ‘How do those processes happen?’”
[00:00:00] Parker Gilbert: The best finance and accounting teams really push as much of the work upstream into building good systems, good architecture, and really rich data sets that then obviously make the, the process of, of modeling, of forecasting, of collaborating with folks, you know, much more simple and streamlined.
[00:00:16] Joe Michalowski: Hello, and welcome to another episode of The Role Forward podcast. My name is Joe Michalowski, and this episode is brought to you by Mosaic, a strategic finance platform that transforms the way business gets done. And today, my guest is Parker Gilbert, Founder and CEO at Numeric, a company transforming accounting workflows to modernize the month-end close.
[00:00:55] Joe Michalowski: Parker, thank you so much for joining me today.
[00:00:58] Parker Gilbert: Thanks for having me, Joe.
[00:00:59] Joe Michalowski: Sweet. Before we get started, do you wanna just give everyone quick background on who you are, what your careers looked like, and how you ended up starting Numeric?
Parker Gilbert Introduction
[00:01:08] Parker Gilbert: Yeah, happy to. So I guess a little bit of context about myself. I joined a startup straight out of school, actually, with two of my co-founders now here at Numeric. And it was a pre-revenue company, and that was an incredible ride. And I would say we, we, we took away both a lot of things. They were very helpful in terms of how to start a company, and we took away a lot of things that we knew we didn’t want to go do again, which have turned out to be some of the most important and useful lessons on, on this journey thus far. From there, I then joined a company called Hearth, which is in the home improvement space.
[00:01:43] And that was an incredible, incredible company, is an incredible company. And joined as the first finance hire. Really kind of a cool role. One where, candidly, no one at the business exactly knew what that was supposed to mean or, or what the first finance person was supposed to do. And so really had a lot of leeway to make that role my own, you know, and sort of figure out what, how I wanted that sort of finance org to function in, in terms of a, a high-growth startup.
[00:02:07] Parker Gilbert: So, joined there, spent a few years there. Got the opportunity to also grow out the, you know, and build out our first accounting team. Bring that in-house. Also, build out our people ops team, our recruiting teams, and, and a couple others. And that was just an incredible experience. About 18 months ago, made the jump to go start Numeric.
[00:02:25] So, it’s been a wild ride already. And, yeah, excited to share a little bit more about the company and what we do and more generally just sort of talk about the accounting and, and, and finance space and anything where, where are my people to be helpful. I think one or two of the things that were
[00:02:41] pushed us towards starting Numeric, and kind of being in this space was definitely sort of solving some of the problems that we had at Hearth. I think that’s kind of a relatively unsurprising or sort of traditional like, you know, founding origin of, of being frustrated about some of the workflows and day-to-day things that we were faced with.
[00:02:57] And, and I think one of the things that was particular about that business was it, it wasn’t necessarily just a simple or straightforward SaaS business. We were selling kind of financial services into home improvement contractors. And so we did sell SaaS subscriptions, but we also had a marketplace where we would sort of connect home buyers and, and sort of, contractors with, with financing options.
[00:03:23] We process payments. We actually started an insurance brokerage, and we’re brokering insurance policies. We were acquiring companies in this space and so…
[00:03:31] Joe Michalowski: It’s a finance nightmare.
[00:03:32] Parker Gilbert: I mean, it was, you know, from, from the sort of series A, you know, it was a, it was a, there were, there were multiple revenue lines from, from day one. And so I think that was somewhere where the accounting got complicated really quickly.
[00:03:44] And we also had audit requirements from, from really day one in terms of state licenses and, and, and regulators that we needed to provide audited financials to. So it put a lot of rigor and stress really quickly on how do we make sure that, not only is our data accurate, but obviously it’s also controlled.
[00:04:00] Parker Gilbert: It’s we’re we’re getting the right functions in place to, to, to maintain that sort of audit-ready posturing. And we’re doing that with a very lean team across a really sort of huge volume of transactions. And that was a, a sort of interesting start to that company was actually the, the very first thing that, that I did when joining was see the company through the first financial audit.
[00:04:20] And joined in January, and we had auditors showing up kind of literally days kind of after my arrival to come start doing a sort of opening balance sheet audit. And in the last 12 months, the company had acquired other businesses, had, you know, never deferred revenue, never sort of had any of these sort of accounting treatments in place.
[00:04:38] And also candidly, I didn’t come from an accounting background. So that was the sort of crash course in how do we go from, from really a cold start to, to ensuring that these sort of processes and controls are in place. And so, as we sort of were looking in and sort of scaling some of our businesses, we, we faced a lot of the, the same challenges that I think a lot of kind of high-growth businesses did. But we also ran really headfirst into the wall of, really sort of more complex kind of accounting workflows and treatments that, felt like a, a sort of really compelling space for, for us to go start a company and, and for us to go help other companies kind of improve their processes too.
[00:05:14] Joe Michalowski: Wow. I, it gives me a headache just thinking about all the, the work that you had to put in on the accounting side and to not have an accounting background specifically, crash course is probably an understatement. And yeah, I mean, I, the, the first question I wanna ask is, is really based on kind of the mission statement as I, as I sort of understand, or the vision for Numeric. It’s kind of modernizing or facilitating like the next-gen close process for accounting.
[00:05:43] Can you just explain what you mean by like the modern close process? How does it differ from kind of the traditional one and, and what are you kind of driving toward as, as Numeric?
What’s the Modern Close Process?
[00:05:52] Parker Gilbert: Yeah. I would say before we jump into that, I, I would say I feel like I owe a sort of a, a shout out or sort of like huge sense of gratitude to our, our, our first audit team we worked with at Hearth because they were just the most insanely patient people with me. And, you know, I would literally show up, and I, I, I’d ask the question most mornings of like, “Okay, what do you guys need tomorrow?
[00:06:11] You know, what, how do I stay one step ahead of you to make sure that you guys are productive and have the things you need?” And, you know, I would inevitably leave the room being like, “What the hell is software capitalization?” You know? And then, you know, I would sort of stay up all night and come back the next morning and, you know, have sort of our first pass at sort of what our, you know, software capitalization policy would be.
[00:06:32] And they were an incredibly patient and fun group to work with. So…
[00:06:35] Joe Michalowski: Fun auditors. I don’t know. I, whatever, whoever the people are on this team, good for y’all, ’cause I’m not sure fun and auditors comes up that often. So good for them. Really nailed it.
[00:06:45] Parker Gilbert: I, I, I think, uh, I, yeah, I, I’m, I’m incredibly appreciative of them. And I think I, my eagerness to learn was, I think they, they appreciated the fact that I was gonna go run into this sort of head first and, and, you know, do everything in my, my grasp to, to get through it. But, yeah, was, was, was a, was an incredible learning curve. And, but also a point in time where I don’t think I’ve really ever worked harder since then in terms of just how, how much it took to get, to get through that.
[00:07:07] Joe Michalowski: Yeah.
[00:07:07] Parker Gilbert: I. Yeah, so I think in terms of, sorry, so your question was about what do we do. Right? Like what’s, what’s…
[00:07:12] Joe Michalowski: Yeah, kind of the vision. Like what’s the if you’re modernizing the, the month-end close, what’s like the before state versus the after state? You know, you notice all these problems and, you know, where are we trying to get to with the help of, you know, great software like Numeric?
[00:07:24] Parker Gilbert: Totally. So I think, you know, I, I think as you, you think about the sort of month-end close you, you know, there’s a lot of the sort of first pieces are the things we’re just talking about, right? Which are how do you implement workflows and sort of process to ensure that everything’s done as part of the close.
[00:07:38] How do you ensure your sort of ongoing audit ready posturing and, and, and really sort of map your workflows to ensure that you’re, you’re kind of doing those as, as efficiently while getting all the sort of, you know, i’s dotted and t’s crossed that you need to do. I think where we’ve sort of seen and, and, and, and I’d be curious to get your perspective on this too, from the Mosaic side of things is, is the demands on sort of both finance and accounting functions have really been changing.
[00:08:03] And I think one of the sort of real kind of initial perspectives has been, it’s not good enough anymore as an accounting team to just prepare a set of audited financial statements. You know, there are things you need to do to make sure that you are, are ready to produce your financials at the end of the year.
[00:08:18] But what stakeholders are really asking for on an ongoing basis is much higher level detail into your accounting data. Right? And so I think a lot of what we think about is is, is the month-end close being a little bit less of kind of a workflow and kind of compliance process. Like it is those things. But, but equally it’s a data problem. And it’s a question of how do you ensure that these data sets that the accounting team is the owner of, is responsible for,
[00:08:46] are correct, are up to date, are complete. And, and not just at sort of an aggregated level but also on a transaction level, right? How do we ensure that vendors are attached to every single expense right. How do we ensure that for marketing, you know, campaigns, we’re really sort of enriching them with the right data points to ensure that the marketing leaders can use that information most, most, most useful right to, to, to do their jobs better?
[00:09:09] And so for us, I think it’s, it’s, it’s, it’s really been this sort of perspective of how do you build great financial close software, great software for accounting teams where the sort of real starting point is that data set as opposed to, you know, sort of the checklists or kind of the to-do part of things.
[00:09:25] And so, we want to, and, and enable teams to both maintain the sort of workflows and, and, and posturing and controls that they need to as, as part of their compliance infrastructure and as part of their, their controls and workflows, but it’s really all about going that step further into understanding and at, at as detail the level possible, what’s happening with, with every transaction that’s hitting your GL, what’s happening with these data sets to ensure that the accuracy and the, the veracity are all sort of as, as, as high as possible.
[00:09:54] Joe Michalowski: I mean, you’d mentioned like getting the Mosaic perspective. I, when I started here, I, I didn’t have a background in finance. Like I, I’m a content person. And so I had to learn a lot of these challenges like up upfront. And I kind of applied it just strictly to the finance side. And it took me a little bit to realize that
[00:10:14] the accounting side is equally, if not more, kind of fundamental to the problem. And we feel exactly the same way. It is like data first and foremost. Like every time you talk about solving any problem in finance or accounting, it’s like, “Well, is your data clean?” And so, like, if it’s not, it doesn’t really matter what your, your tools are, where your systems are.
[00:10:36] If the data is not clean, like you’re, you’re gonna have a bad time. And so, very much aligned on that, like for sure.
[00:10:43] Parker Gilbert: Yeah. And I think, I think the, you know, the sort of like, most of these accounting workflows and sort of processes and treatments are, are, are all coalescing at thin month-end close, right? And you do have this sort of very natural blocker and, and serve dependency of, “Hey, before we can go report,
[00:10:57] prepare a budget vs. actuals, you know, reforecast, you know, build our board decks,” right, you need that sort of assurance that those data points are not gonna change, right? That the data’s accurate. And, and all of those pieces then get shifted upstream into, into these, these workflows. And so I think you can really think about a lot of the accounting
[00:11:15] processes as being this sort of owner of these data sets that have lots of these different endpoints and lots of transactions coming in. And we really think like the, the best finance and accounting teams really push as much of the work upstream into building good systems, good architecture and really rich data sets that then obviously make the, the process of, of modeling, of forecasting, of collaborating with folks, you know, much more simple and streamlined.
[00:11:40] Joe Michalowski: Makes total sense. And I think, uh, what we’ve kind of been, when hanging on, is, is what you and I chatted about being sort of the, the main topic here and it’s, it is that. It’s the, the ERP, the accounting data hygiene challenge. It’s like how do you set that as the foundation for everything moving forward.
[00:11:56] And so you’ve mentioned a little bit about why this is important, but can you talk a little bit about like a little more specifically about how, maybe like dirty data in your accounting software impacts, not just the accounting team, but the business at large. Like what, what are we looking at if it is dirty and what is the business not able to do as a result?
The Impact Dirty Data Has on Businesses
[00:12:20] Parker Gilbert: Yeah, totally. You know, I think, I, I think that that, you know, I, I think the account data is, is, is, is, is, is very similar function, right, to a lot of the even sales data, right, and sort of CRM data that, you honestly have a plethora of tools to enable the sales team to ensure that the, the data they’re putting into their CRM is, is correct.
[00:12:38] Right? You know, there are any number of systems to go ensure that you’re building whether it’s better rules, better workflows, or just easibility right to go make edits and changes to, to your Salesforce data. Because people rely on those things to make critical decisions around how are their reps performing,
[00:12:53] right? What do good leads look like? What do good deals look like? What are our time to close look like? All these sort of key metrics. And, and obviously there’s like a, a very similar parallel to your accounting data, you know? We wanna be answering these questions. Some of them we care about sort of monthly or quarterly metrics.
[00:13:08] Others, we care about more real-time or sort of daily snapshots. And so if that data isn’t, isn’t correct, you’re, you’re on bad footing, right, to go make good decisions about your business. And also just really sort of starting to give people real confidence challenges in terms of not being able to trust the underlying data or sort of perspective of what they’re being told from their team, especially if it’s, if it’s changing or sort of not proving kind of overtime to be accurate.
[00:13:33] I think the place that is, is, is particularly challenging is accounting teams are coalescing all these different data sets into their, into their GL from the various transaction systems that they’re using to, to, to push and pull data sets, right? So whether it’s your billing system, whether it’s your payroll system, whether it’s your spend management system or, or any number, right,
[00:13:51] equity, leases… The list kind of goes on and on and on as business gets more complex. You have this really sort of challenge of, of managing just this huge scheme of, of, of different data sets and, and, and, and collecting them all together. I think one of the things that is, the place that teams always really start with is like, “Okay, well, well, well how do we, how do we understand what our business par partners wanna do in the first place?”
[00:14:12] Right? And so I think it’s a little bit of a hard question to answer, just like, what does it constrict your business from just doing period, right? The question is like, what are your business leaders trying to accomplish, right? What are their goals? What are their metrics? What are their, what are they waking up every day and thinking about?
[00:14:26] And then kind of walking back into, “Okay, well how can your accounting data and financial data better, better inform that?” That comes up all the time, right? And we, we see companies, we’ve worked with companies that have gone through huge maturation processes from, you know, not having vendor data in their ERP to doing the work over what has sometimes taken months to then get to a point where they can now produce spend reporting for every one of their department heads, right, about kind of the vendors that they own and who are they responsible for and how are they being allocated.
[00:14:55] And that work intrinsically just needs to be pushed back upstream into these accounting systems and into the right source of truth, you know, in order to then be managed in this sort of scalable and, and, and repeatable and sort of trustworthy manner.
[00:15:08] Joe Michalowski: Makes so much sense. I, I the parallels between what, what you all are doing on the accounting side and what, what we care about at Mosaic on the, the more of like FP&A finance side, it, it’s so, it, it’s so correlated. Like it, it’s completely tied together. And so I I, I love hearing about this, but we, we kind of talk about strategic finance. And like, it, it kind of encompasses the accounting side as well.
[00:15:30] But, uh, we’ve talked, I talked to another podcast guest once, and like we talked about like strategic accounting. And so, uh, kind of my, my, my follow up question was like, how does, how does accounting take more ownership of this data set? Like in the past, like maybe they were just seen as kind of like the back office, like get those reports out the door.
[00:15:50] What’s like the mindset shift that they need to go through or even like, what are the, the processes they need to go through to actually take ownership of that data and turn it into what you’re talking about?
[00:16:02] Parker Gilbert: Totally, you know, I think this is a theme that comes up in, in so many of our conversations too, in the sense of, of how really sort of like leading accounting teams are, are, are, are doing everything they can to be operationally like great partners to their business, you know? And, and I think this sort of strategic finance sort of side has gone through this great rebrand and sort of like push to, you know, position, you know, FP&A and sort of our finance teams as, as really operationally impactful people.
[00:16:29] And I think accounting is also going through a lot of the same shifts. I think the first, I, I think there are a couple steps that we see teams roughly kind of take that I think are are important. You know, and, and one is just to first run, run head first into like, there are a lot of required workflows that accounting teams have to manage.
[00:16:48] Period. If they don’t get done, nothing else can be done. You know, and, and, and you can’t just avoid those things, right? Like we, we’d all love to go like just do the things that are the most fun at work. I mean, I know I would, but, but there’s a lot of them, you know, on the accounting side in terms of just how… And a lot of recurring processes and workflows that, that, that never stop, you know? The month-end close rolls around every month and, and takes up end number of days for teams.
[00:17:12] So I think the first thing is really kind of building a great operating cadence of, of, you know, building out for, for accounting leaders and their teams. What is a really dialed sense of the roles and responsibilities? You know, who’s responsible for what, what are the timelines and expectations that we’re gonna share to our business partners and, and leadership? And, and, and really sort of professionalizing and, and making sure that those pieces are, are really communicated if, if nothing else, kind of effectively to everyone else in the business.
[00:17:39] Because only once you get that part right, can you then really start to drive into the next set of questions of, “Okay. Now how do we go provide the sort of utility and, and, and value that we want to go build these sort of strategic relationships with?” And, and I think probably somewhat similar to the finance side of things, a lot of it is, is, is is next sort of foundationally in, in, in, in going out and actually building those relationships right.
[00:18:04] And, and getting time with different stakeholders to understand where are the places where we can improve their life, right? And, and again, so much of these pieces, maybe they may, maybe they do come through finance sometimes, but I think a lot of times they come directly around. You know, speaking from firsthand experience, you know, we our accounting team would spend it, it
[00:18:24] a huge amount of time with the marketing team, you know, at, at our last company. And we would go track at a, at a really high level of fidelity, you know, our acquisition costs. And we would be pushing those through our general ledger and tracking marketing campaigns, vendors, you know, tenure of employees, all these sort of metrics so we could then enable,
[00:18:43] you know, the marketing team to really have a much better sense of, of not just sort of their acquisition costs at the high level, but on a, on a deal by deal basis. You know, what are literally every single expense that can be attributed back to every closed one deal. And those pieces are like, just cannot be done without accounting, really understanding the business problem and sort of questions that they’re trying to solve,
[00:19:03] right? You know, I as a sales leader wanna understand our, you know, what are our payback periods as ramps rep, or sorry, as as reps ramp over their first few months, right? You know, if, if the accounting leader doesn’t understand that question, they have no way to go understand how do they take, go back to their accounting data and take a look at the information and say, “Okay, cool.
[00:19:22] Like this is actually a solvable problem, that if we set up some systems, if we, you know, add some new dimensions to our ERP, if we go start to allocate things differently. Like we can actually go, go answer that question pretty efficiently every single period.” Um, but if, I don’t know that that’s what you’re staying up at night thinking about as a sales leader, like, well, you know, I’m gonna go back to the sort of same workflows that I’ve been working on in terms of, uh, things that are maybe more traditionally kind of in, in my lane.
[00:19:49] So there’s a lot of those pieces that, again, probably do parallel very similarly to the sort of strategic finance side of things, where if you don’t understand the operating metrics, if you don’t understand the priorities, you, you don’t end up sort of just building your, your, your workflows and your, your, your data systems.
[00:20:08] That again, like you are the owner of and responsible party of with the nuance and perspectives that you need to in order to to, to sort of drive good operational outcomes.
[00:20:17] Joe Michalowski: It’s so funny. I, as the person who has written a lot of the content that Mosaic has, I’ve written about almost exactly like the same metrics, like from the finance perspective. I think it just speaks to like how closely that like, or how close that finance accounting relationship has to be. Like, I, I think I’ve talked to a few other, talked to Temi Vasco, she’s a controller at Gem. And like, talked a lot about kind of building a stronger bond between finance and accounting that maybe traditionally or maybe at like larger companies is kind of a clear split.
[00:20:48] It’s like that’s the forward-looking side, and that’s the backward-looking side. The fact that these are all of your examples and we talk about all the same ones from the finance side, just tells me that like if this bond between these two sides is not tight, especially in like a high-growth company, like a, like a VC backed, kinda like SaaS business, you’re probably gonna be in trouble.
[00:21:06] Like, it’s just nothing’s really gonna move the way you want it to. You’re not gonna have that strategic standpoint. So I, I, yeah, just a ton of parallels between what we talk about.
[00:21:14] Parker Gilbert: Totally. And I, I think, first of all, Temi’s fantastic and a huge fan.
[00:21:18] Joe Michalowski: Love Temi.
[00:21:19] Parker Gilbert: And, we, um, you know, I think that handoff is, is, is as you sort of get to larger companies, like, like frustratingly rigid, you know, around kind of the, the delineation of duties and responsibilities. And I think a lot of the sort of systems and, and challenges that people sort of playing in their own kind of swimming pools, like, makes it worse. You know and, and, and that handoff between, you know, are vendor, are vendors tagged correctly, you know, expenses to the right departments.
[00:21:46] Parker Gilbert: These sort of questions are things that all of a sudden can, can turn into like really time intensive and sort of frustrating back and forth between finance and accounting. And I mean that’s, those are the things that should be happening very collaboratively as part of the month-end close. And, and in that sort of first period where the books are open and we’re making changes, and we’re working quickly to finalize those things, those should be extremely collaborative workflows.
[00:22:07] They should, everyone should be kind of moving together and sort of in sync, but can create a ton of friction. And, and especially, you know, I, I, I know there’s like nothing more frustrating to a finance team than all of a sudden, you know, they go to reload their model, and some numbers have moved, and things have changed, and people don’t understand what’s happened and, and what new transactions have been posted or why things have been changed.
[00:22:27] And those are the types of problems a lot of the sort of problems that we’re solving at Numeric with the ability to, you know, really kind of fine-tune, tell people, “Hey, you know, maybe Joe signed off on a reconciliation and then, you know, something changed, but now we can point to you specifically the transactions, the activity feeds that, that caused those changes to take effect and, and how do we enable people to sort of play off of, again.” That sort of really detailed level of financial data and, and how it’s, it’s impacting both operational metrics and, and obviously more sort of like, you know, substantiation ones too.
[00:22:57] I love it. I think, I think it, it’s such an important aspect of, you know, getting to that point that we’re talking about, that strategic accounting kind of vision. But one thing I, I wanted to follow up, you’ve, you’ve referenced kind of like you referenced the audit controls, kind of the, the things that need to happen.
[00:23:15] Joe Michalowski: But, candidly, when you and I were chatting about like a potential topic for this, you were, yeah, like some strong standpoint on like where to prioritize your time. Like, especially like if you’re, obviously, if you’re like a public company, it doesn’t work this way. But, if you’re a private company, like what to prioritize more, and it’s like the audit controls the gap compliance versus like doing everything you’re talking about to sort of set up.
[00:23:37] Can you talk about the relationship between, I don’t know, I guess, how you prioritize your time and like where you focus if you are one of these accounting teams trying to get to that strategic standpoint?
Where Accounting Teams Should Prioritize Their Focus
[00:23:49] Parker Gilbert: Yeah, I think, again, sort of like all functions, there are a lot of different hats you have to wear. And I do sort of truly believe, I think there’s, there’s, there’s quite a lot of these are, are sort of overlapping when it comes to the work that an accounting team needs to do to ensure the sort of the correctness, the detail of their data sets. And obviously, this sort of overlapping with, “Okay, what are now the segregation of duties? What are the controls, sort of the compliance pieces that, you know, is part of that sort of o ongoing kind of audit-ready posturing and sort of workflows?”
[00:24:17] And so I think there’s, there are quite, quite a lot of overlap in terms of just these functions and kind of how these things work. But I, I do think it is, it is incredibly important to be always making incremental improvement on the operational front. You know, and, and, and, and always ensuring that every single period, you know, the data that’s being presented to other teams has the next level of detail that is helpful, right? That is sort of building the kind of cadence and sort of like expectations with the team that, “Hey, this is something that we’re gonna work at and something that we’re gonna be doing kind of improving
[00:24:47] Joe Michalowski: Yep.
[00:24:47] Parker Gilbert: all of the time.” I think on, on some of the pieces too, and, and, and it does really start to change with the, you know, the maturation process and sort of, you know, as companies scale.
[00:24:56] But it’s really important to, I, I think to sort of try and set that expectation as a, as a, as a business partner, that, that these are the goals you’re trying to shoot for. And it also makes getting the resources then to go sort of do your job candidly as an accounting team much more straightforward as you kind of build out that posturing.
[00:25:13] You know, there are these sort of flywheels that come into effect, which is, “Let me show you what, what I can do for you, and then, you know, next month, let me ask for another accountant so we can do twice as much of it.” You know, and, and so, you know, as you sort of can build reasons why you’re having that positive impact on the business and not fulfilling just necessarily only a sort of core requirement, but, but going beyond that, it builds the sort of case for resources and sort of sort of scaling the, the operations.
[00:25:40] Joe Michalowski: Yeah. As I think anyone listening to this that works in finance and accounting, especially at like high-growth companies, there’s never enough people. You are probably the last one to get investment as far as headcount goes, and probably gonna have to stretch 1, 2, 3 just finance, maybe like a staff accountant, somewhere down the line.
[00:25:59] Those resources are gonna have to stretch as far as humanly possible. So I think, it’s a really great point. Anything you can do to kind of make the case to build out and get help where you can, it’s probably very helpful for people.
[00:26:10] Parker Gilbert: Totally.
[00:26:11] Joe Michalowski: I think, so, I’m, I’m gonna sit up in my chair ’cause I think there’s always a point in one of these podcasts because I try to make them as like practical or actionable as possible. I have a good handle now on like where you stand as far as what the vision is for being a more strategic accounting, like function, being a business partner, the importance of having your data, your workflows in place. I want to go a little bit deeper because we have prospects that show up
[00:26:38] all the time. And they say, “Oh, well, you know, my, my ERP is a mess. Like my, my QuickBooks or my NetSuite, it’s just, it’s really messy. Like, I don’t know if I’m gonna get the value out of my data, if I have, you know, a tool in place to, to kind of get analysis done.” And so what I want to talk about is like the how of cleaning it up.
[00:26:58] So if you’re somebody who says, “You know, my ERP’s a mess,” and you need to clean it up, or somebody, you know, as you did at Hearth. Like, “Okay, auditors are here. I gotta clean all this up now because I just have to run into it.” You know, first off, like where do you start? Like, okay, my ERP is a mess. Like, great, what’s, what’s my first step?
[00:27:16] What do I need to do?
How to Clean Your ERP Data
[00:27:18] Parker Gilbert: Yeah, it’s a great question. And you know, I think the, I think the first thing that, that I would sort of highlight at, at a really high level is this like should be something that’s iterative. And it shouldn’t be something that is sort of viewed as a project of like, we’re gonna go from having data that’s a mess to data that’s perfect.
[00:27:37] It’s just like the world doesn’t work that way and, and, and nor does it need to, right? And so again, I think sort of getting into a mindset, which is what is the most important things that we can start to chip away at and, and where can we go start to make incremental improvement in terms of how we are improving this sort of data quality and, and hygiene in systems. I think is, is super important.
[00:27:55] And it’s, it’s way easier to go fix one thing in the first month than it is to try and fix six and then actually not sufficiently get any of them far enough along to, to have made any difference, right? I think from then you, I think the sort of next step is really kind of diagnosing like, where the biggest challenges obviously lie, you know, in terms of what you’re trying to utilize the data for. You know, if you have sort of foundationally, I think the first things that you really need to deal with are, are candidly, like more of the core accounting processes, right,
[00:28:23] Parker Gilbert: then actually, the sort of strategic finance questions, you know? First thing that you really should care about is like, is what’s on my balance sheet substantiated, right? Do we have the confidence in what we’re representing that exists on our balance sheet, you know? Is everything there that should be there, you know? Is what’s there actually substantiated, documented, controlled, and in the right amounts?
[00:28:44] And, and how do we go through that process of starting to build out the work papers and, and supporting records to have complete and ongoing confidence that, that that data is correct? I mean, that’s the most painful part to unwind is, is, and this is not gonna be a surprise to anyone who’s kind of, you know, gone through any of these processes, but it is really unpleasant going through a process and realizing that your balance sheet doesn’t look the way that it should.
[00:29:08] So, you know, once you kind of have a grasp on, on, you know, the, that, that sort of maturation, and I think a lot of companies go through that as they go through the sort of, you know, bringing their accounting team in house, hiring their first accounting managers, controllers sort of team. So you, you kind of go through this process of like, you know, we’re now truly kind of
[00:29:27] Parker Gilbert: thinking about this and going to sleep every night thinking about this and, and we quite possibly have a lot of work that we have to do to go, to go get up to speed.
[00:29:35] Joe Michalowski: Yep.
[00:29:35] Parker Gilbert: You know, once you have this sort of ground under you, you can then start to really, I think, again, I, build out, you know, sort of the, that that core month-end close process, right?
[00:29:44] Like, like your month-end close process is, is the chance to do the, the, the, some of the hard yards of ensuring that your accounting data is totally up to speed and accurate. And then you have confidence in, in what’s happening. And then you can start to build on the next layer of like, “Cool. Now in order to go feed the marketing team, we need this data. Now to go feed the sales team,
[00:30:05] we need y data. Now, you know, we need to go start getting ahead of the next level of, you know, more technical accounting treatments that are gonna be important for our next year audit.” Right? And our sort of, you know, we’ve got lease accounting coming up or you know, how do we go make sure we’re sort of getting the right systems in place
[00:30:19] and iterating on that before it becomes kind of mission-critical? And so, there’s a lot of kind of balancing acts there, but a lot of it comes back down to like starting to build up those really great processes and foundations. And, you know, candidly, one of the things that I’m really thankful of, of, you know, my last role at Hearth was like, we had no choice but to go through that audit, you know, at first. And, and I did not come from a finance or accounting background.
[00:30:41] So, we walked away with that being like, “Man, we, we are never gonna go through an audit.” That was that hard to get. You know, and, and the answer was like, ” Okay, we gotta foundationally again, push a lot of this up to the accounting workflows and the accounting streams, and we get those right. And then we go start building out, you know, our slate of operating models and playbooks and things.”
[00:31:00] And, you know, life is, life is like immensely easier.
[00:31:03] Joe Michalowski: Oh, I, I, I mean the theme there, you said it right at the beginning, was just like the, the iteration that goes into this. And I think, I think what I hear from, from prospects when, when we talk to them is when they talk about the ERP data or their accounting data being a mess, it, it, it sounds like they’re approaching it from like the opposite of what you’re saying, where it’s like, “We need to do this one big project.
[00:31:26] Everything is on hold until we can get this in place because this is like our biggest focus.” But it sounds like, you know, you can’t really afford to put everything on hold. You need to chip away at what you can chip away at and keep the business moving until, like, you get to a point where it comes to ahead and you can move forward with that strong foundation. Unless you’re like at Hearth where like, you know, you’re in these audit controls and you have no choice but to do it all at once and like do it quickly.
[00:31:54] But I, I think the iteration is, is what stands out to me. And it’s what maybe is not the obvious option for, it sounds like some people that see it as like one big blocker to everything they’re doing.
[00:32:07] Parker Gilbert: Yeah, I mean, I think it’s one of these sort of truisms that’s like, you know, across every function, you know, you look at the people who come in every day and get done 10 x as much as other folks. And, and so much of it comes back down to the ability to put blinders on, do one thing really well. Forget about the other plates that you’ve thrown up into the air that are gonna break.
[00:32:25] Like, great, you know the answers. You’re gonna show up the next day and have to do the same thing and throw another 30 plates in the air and pick which one you’re gonna catch. And it’s, it’s, it’s, it is just, it is, it is across, you know, every function that ability to just almost shortsighted, right, and sort of, you know, what are we gonna get done today?
[00:32:44] Inevitably leads to a better outcome, you know, a year down the road than it does to be, you know, overly concerned with, you know, all of the things that one could be thinking about.
[00:32:53] Joe Michalowski: Yeah. The last practical sort of question I have about this is, so what we went through this big process. We released a new book, we did a podcast episode about, about CRM hygiene. And so that was the first, like real, like, to me, that that sounded like the most beastly of source systems to figure out because of how customizable like a Salesforce or like even a, a HubSpot can be.
[00:33:14] And I guess at the time, like I wasn’t aware that ERP hygiene was equally complicated. And so what I learned in that conversation that at a certain point, like you just kinda have to go back and do the manual, like heavy lift of just going through every contract, like fixing the data, cleaning it up. Like it is not, there’s really no shortcut or like speed to it.
[00:33:37] Like you just need to sit down and do it. Is it the same thing here? Are there tips, or are there ways to make this cleanup process a little smoother? Or are you just kind of stuck like, “Hey, like we have to do this. We need to make the investment in this painful process.”
Tips for Smoother Data Cleanup and Management
[00:33:53] Parker Gilbert: Yeah. I think, it’s a good question. I mean, all the work I feel like, and I’ve done firsthand in this front, has been pretty painful. And, you know, not, not particularly pleasant, but also again, that’s sort of the somewhat natural iterations of like, “Hey, we’ve done something once we’ve realized we’re not quite tracking this as fine-tuned as we thought we were.
[00:34:11] Okay, cool. We’ve now learned the next lesson. We want to go start breaking out, you know? Our marketing channels in our GL because we know that in order to push the data, the places we need it consistently, you know, having one account about advertising is not actually the best way for us to go. Track these expenses and let’s go potentially do some cleanup to go really clean that up for, for quite some time in order to go, you know, give ourselves both retrospective and kind of current reporting or, or maybe we’re just doing it on a go forward basis right.”
[00:34:39] But, but that’s the hard work that is pays off in, in, in dividends as sort of teams scale. And I think it is incredibly important to recognize that, you know, that’s where you should be trying to push as much of your work towards. And if those functions are happening correctly, then you know, the output is coming more repeatedly and faster and cleaner. And you’re not having to stitch things together,
[00:35:03] you know, kind of on the backside as much and sort of, you know, blend data sets and add enrichments sort of in your models. Like those should really be coming in at, at sort of, again, as kind of high upstream into the system as po as, as possible.
[00:35:16] Joe Michalowski: Yep. Makes sense. I’m looking at the clock. I, I, I want to be mindful of time. I have two more questions, but they’re, they we’re out of the, the super tactical, like lower level things. So we’re gonna zoom back out a little bit, make it a little bit, a little bit more lighthearted. I wanna, I wanna roll back to kind of where,
[00:35:32] where we started, talking about this vision of like the, the modern close process, the modern sort of like accounting process. And I think like what, what I’m, he, what I’ve heard from you and what I’ve heard from other sort of like, you know, forward-thinking accounting leaders is that the, the vision is to get to like a continuous or like a daily close.
[00:35:50] And so like that’s obviously like it, it’s a process that’s not something you just do overnight. But let’s say that, like we hit that. You know, I, I buy a Numeric, I am happy with my life. My close is like almost on autopilot. It’s happening every day. As a way to sort of sum up everything you’ve talked about, ’cause I think you’ve touched on a lot of those,
[00:36:09] would love some of like the key takeaways of value that brings to the business as a result. Like if you can do that daily close, what does the business get from you as an accounting team? How do we benefit?
[00:36:21] Parker Gilbert: Yeah. I think there’s, there’s, there’s at least three things to touch on. One, so many of these operational decisions should be happening with more input from the accounting team and from the places where, you know, we have real confidence that things of the dollar sign are, are being counted correctly and sort of, you know, kind of processed. And so, you know, if you’re not kind of moving quickly enough and understanding what are some of those more real-time, continuous decisions that are not happening on, you know, a sort of clean period-by-period basis, which is sometimes, but not always, sort of the way business decisions work.
[00:36:52] You’re gonna start getting carved more and more out of the loop of like, how do those processes happen? And, and they start to happen in, in BI tools and with, again, other people now stitching together data sets. And so, like my philosophy would be like, you wanna get yourself in the mix. You want to be pushing yourself into the world where you are, are on a day-to-day really kind of being impactful.
[00:37:11] Parker Gilbert: There’s some businesses where that’s like just absolutely necessary and, and teams have no alternatives. So I think a good example of this was, I was talking to a controller last week who was sharing about how they, they’re in the e-commerce world and they surprisingly run these big Black Friday events and, and sort of sales. And depending on the volume that they’ve sold on Black Friday directly influences their discounts for Cyber Monday.
[00:37:36] So they will sort of, over that weekend, go assess what their inventory is, what volume they’ve moved, what their goals are for Cyber Monday. And then they’ll go actually change the percent discounts and the promotions that they’re running. And those are the sorts of things that in every business there are these sort of questions. Like, you know, in, in SaaS businesses, a lot of the time it is on marketing spend. And sort of how are we fine-tuning our, our ad spend on a daily basis to understand, you know, are we gonna hit our sales goals and what are our, you know, sort of, you know, payback periods and acquisition costs looking like. And all of a sudden, “Oh no, you know, Facebook, you know, ads have gone up 3x in the last, you know, week, and now we have to really go do some math to understand.”
[00:38:16] “Okay, that cohort’s now gonna play out differently than expected. Let’s go tailor the next one.” So, you know, a lot of those pieces, they should be hitting the accounting process and those are the sort of key decisions and sort of ongoing pieces that a continuous close and, and more continuous accounting can really, can really drive teams to.
[00:38:34] I think the, the, the last and third point I, I would flag is there is just also a level of improving the day-to-day workflows and like experience of being at a company. And your ability to smooth out a lot of that curve of like, you know, at the beginning of the month, “Hey, we have to go do all of this work.”
[00:38:53] And people are working overtime and are tired and stressed. And you know, the CFO and the CEO are breathing down people’s neck to understand how much did we burn last month. What is our, what are our bookings coming in at? You know, those are really high pressure and, and, and stressful and tense periods.
[00:39:12] And, and it’s, it’s the ability for teams to pull more of that work forward to, to get more into daily, weekly closes where they’re managing more of their, their kind of workflows and, and accounting on an ongoing basis, uh, leads to just a better employee experience, almost certainly. And so tho, those are things that are maybe less like,
[00:39:33] you know, quantifiable towards, you know, kind of the, the business outcomes, but in terms of getting talent, keeping talent, retaining talent are really impactful.
[00:39:41] Joe Michalowski: Yeah, that, that, that last point, I had Lauren Barr from Occupier on, she’s VP of Finance, but is a CPA. And the, the big thing she wanted to talk about was that, you know, accounting as a profession is just kind of like dying. There’s just not a lot of people raising their hand to be accountants right now. And, you know, to your point, it, it’s, you know, not very… It’s a thankless job at times and it’s a stressful one.
[00:40:05] And so, yeah, I mean, if you can get to a point where you can achieve this level of a strategic thinking and, and kind of strategic value, yeah, maybe that uptick goes back in the right direction for accounting. So I think it’s a great point. Yeah. Maybe not quantifiable, but an important point nonetheless.
[00:40:21] Parker Gilbert: Yeah.
[00:40:22] All right. I have one more question for you. It is not related to anything we’ve talked about so far, but we ask everyone that comes on. It’s just very high level, what is one thing you know now that you wish you knew when you started your career in finance?
[00:40:38] Parker Gilbert: Hmm. I would sort of apply this more broadly to, not necessarily just finance, but I think one of the things that I know as a lesson I learned hard myself and, and I’ve seen others as well is, is, you know, how do you best kind of communicate to other people, kind of your work and, and give people the best visibility into what you’re doing.
[00:40:55] I think people usually assume that everyone else has kind of perfect information around what’s going well, what’s not going well, where are things taking longer than expected, where are things, you know… You know, even like, even as far as like hell, like what are your goals for what you’re hoping to achieve out of your role?
[00:41:11] Parker Gilbert: And, and I think those things are, are usually feels like it takes a hard lesson or two of, and, and I wish I’d learned that sooner. And feel like that’s something that you usually have to assume that people have like something like 20%, you know, the visibility that you expect they have into your, your day-to-day and your work.
[00:41:27] And so building this sort of like mechanisms and feedback loops and processes that like you have to own to go manage up, to manage others, to manage alongside so that everyone else can have kind of really as good of information as possible about what’s happening, is hugely important. And I think particularly on the finance side of things. Yeah, a lot of the work is, is people are, are relying on the finance team to produce board decks, right,
[00:41:53] to get metrics done. And those are things that other people have timelines and dependencies and requirements. And your ability to go again, kind of best communicate to others the sort of status of what’s happening, I think is oftentimes kind of easier said than done.
[00:42:07] Joe Michalowski: Yeah, I mean, every time I ask this question, somebody’s like, “Well, you know, I think it’s a little bit broader than just finance.” Every time I probably take away something that is helpful for, for my job as well ’cause the, the same thing happens in any position. It’s just the, those, getting those feedback loops in place so that people do know what you’re doing and whether or not you’re tracking toward your goals is, it’s important.
[00:42:26] So I think it’s a great point. I do obviously mindful of your time. That was my last question. So I just wanted to say, thank you so much for, for taking the time. I know the life of a, a founder is not, it’s not an easy one and I’m sure you’re very busy, so I really appreciate you taking the time.
[00:42:42] I want to turn the floor over to, to you. Where can people go to learn to connect with you to learn more about the work you’re doing at Numeric? Anything you wanna plug is, you know, time is yours.
[00:42:53] Yeah. Please, you can find us at numeric.io. You can find me on, on LinkedIn or email@example.com. We are looking for, we’re hiring right now. We’re looking for people across sales marketing and engineering and are also really proud and excited to have quite a few companies who are also customers of Mosaic.
[00:43:13] Parker Gilbert: And so, we love the overlap, and please reach out if you have any questions.
[00:43:17] Joe Michalowski: Sweet. Well, Parker, it was great having you on The Role Forward. I hope we can do it again sometime, but this was great. Just appreciate it.
[00:43:23] Parker Gilbert: Sounds good. Thanks, Joe.
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