When closing the books on the end of a fiscal year, speed matters and some companies can get it done in just a week or two. A recent study shows that U.S. firms do it twice as fast as European companies, Reuters reported.
A recent survey by IBM Business Consulting looked at how fast companies reported their 2003 results, finding that just one European company— Germany's Beiersdorf—was able to do it within 21 days, as compared to more than 20 of the largest U.S. companies that broke the 21-day mark.
The world’s fastest 20 companies were all North American firms with the exception of South Korea's Samsung Electronics and all 20 closed their 2003 books in 15 days or less. By comparison, the fastest of Europe’s top 25 closed in 29 days, Reuters reported.
Truly remarkable efforts came from U.S. aluminum maker Alcoa, which closed its books in just seven days, and Nivea-cream maker Beiersdorf, which reported after 12. Swiss healthcare group Novartis, Finland's mobile phone maker Nokia and German software producer SAP AG were next with a 21-day lapse, Reuters reported.
Other large American companies, including Dell, Genentech, Bank of America, McDonald's, Wal-Mart and General Electric accomplished the closing of their 2003 books by the second or third week of the new year.
"Some European banks say that they cannot be compared with a company like (communications equipment maker) Cisco, because they claim their structure and industry is more complicated. But there are plenty of U.S. banks which report within 15 days," Klaas van de Geest at IBM Business Consulting, who helped carry out the research, told Reuters. He chalked up the lagging of the Europeans to a different business culture and complicated accounting.
"But there's also an element of culture. Firms do not recognise the need for speed and rather check the numbers again," Van de Geest said.