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Why an Australian fintech company adopted Blackline Reconciliation

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120 balance sheet reconciliations, stacks of spreadsheets, and lots of emails – month-end for Tyro Payments was a nightmare. That was until this fintech organisation adopted Blackline Reconciliation. In FY21 more than $25.5 billion in transactions were processed with Tyro, accounting for 24% of transaction volume Compound Annual Growth Rate. Considered the fifth largest payment processor with 600 ...


120 balance sheet reconciliations, stacks of spreadsheets, and lots of emails – month-end for Tyro Payments was a nightmare. That was until this fintech organisation adopted Blackline Reconciliation.

Blackline Tyro case study

In FY21 more than $25.5 billion in transactions were processed with Tyro, accounting for 24% of transaction volume Compound Annual Growth Rate. Considered the fifth largest payment processor with 600 employees, it only has about 18 people on the finance team. The rapid growth brought increased complexity, risk, and cost in their financial close and reporting processes. So naturally, the team was so thinly stretched with the day-to-day managing risks and reporting that they didn't have enough capacity to contribute to growth objectives.

Key reasons why Tyro chose Blackline Reconciliation

  • thinly stretched Finance teams
  • manual reconciliation process
  • insufficient audit trails
  • little scope for collaboration

Casper Deman, Finance Project Lead at Tyro payments:


"We had an extremely manual reconciliation process at month end. Getting to the actual closing of the GL was not too bad a process but then the actual balance sheet recs themselves were extremely manual."

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Tyro’s quest to automate month-end close with Blackline Reconciliation

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Six months after Tyro implemented Blackline software, Casper Deman, Tyro’s Finance Project lead, joins Octane’s Amendra Pratap, for a fireside chat to discuss life after Blackline. Let’s dive into the learnings from Caspar Deman while implementing Blackline Software in a high-growth organisation like Tyro.

Download the full case study at the end of this article.


Q&A (1)-1


Q. Why don't you give us a quick introduction to your interactions with Blackline Reconciliation?


Casper: "I worked at News Corp for eight years. My last role at News Corp for the last probably a year and a half was heading up the financial services team. That included financial accounting, a much larger proposition than Tyro.

We had about 25 financial accountants on the team there with a reasonably mature Blackline consolidation doing the balance sheet recs for the whole business. We covered off probably around 1400 balance sheet recs a month. It was much larger than what we're doing now at Tyro which is probably between 100 and 120." 

Q. Would you be able to give us a brief introduction to Tyro?


Casper: "Tyro is a fintech company. We're essentially the fifth largest payment processor in Australia behind the big four banks. Tyro has become one of the largest processors of financial transactions primarily in the bricks-and-mortar payments market.

The next time you go into any of your local shops, have a look at the branding on the terminal of your receipt when you wave your card or your phone. You'll be surprised how often it says ‘powered by Tyro’."

Q. What was your major motivation behind implementing Blackline in Tyro?


Casper: "Our major motivation was the automation of our manual reconciliation process. We had an extremely manual reconciliation process at month end. Getting to the actual closing of the GL was not too bad a process but then preparing balance sheet recs themselves were extremely manual as they were done in Excel.

In a broad sense, we were actually hoping to achieve Scalability, Collaboration, and Governance through Blackline implementation at Tyro which was simply not possible with the Excel-based workflow."

Amendra: "We’re working with new clients and when we get to talk to them, they tell us that one of the key reasons that they're putting Blackline in is to try and retain staff. Because they can't afford to have anyone leave. They also can't afford to have employees come in and live in Excel doing reconciliations. Because everyone's looking to get to the next level.

Putting a system like Blackline ensures the automation that allows people to work on things that matter and makes it easier for them to move up the ladder while ensuring the quality of work."

Q. So the Spreadsheet-based workflow was not working for you?


Casper: "The major problems with spreadsheet-based workflow were the linked comments and review points that were typed into the documents by the reviewers all over the spreadsheets.

Everyone used a different mechanism to sort and maintain the status of their spreadsheets. Some would color it green, some would make it bold and someone else would type something next to their recs that would only make sense to them. Basically, everyone managed it differently and it was not working for us at all."

Q. Are you starting to see changes in workflow after Blackline Reconciliation?


Casper: "After Blackline implementation, it's taking a lot less time for consolidation. The team members can all work simultaneously facilitating the collaboration which is starting to deliver. After our evolution, we have been able to get a clear reporting on the number of reconciling items that need an action plan. According to how old they are: 60 days 90 days whatever it might be."

Q. Tell us more about how Blackline improved collaboration in your Team.


Casper: "We've moved away from an environment where everyone was working in spreadsheets. All our team members couldn’t get access to the main spreadsheet, reviewers had to work consecutively. They had to wait until the spreadsheet was complete because they couldn't be in there at the same time.

Whereas Backline is a single platform. Everyone can log in at the same time. Everyone can be preparing their recs simultaneously while reviewers can review them in real-time. Once they're finished, reviewers can send back their clear comments on what needs to be addressed the following month."

Q. Do you think Blackline reconciliation has prepared you for Tyro’s rapid growth?


Casper: "With Blackline implementation, we now know that we have built-in scalability. We haven't actually increased the number of recs yet. But if we do need to start preparing more reconciliations down the line, we know that through the Blackline feature set, we will easily be able to achieve it. The fact that there is more automation and that it just takes us less time to prepare a rec simplifies our overall month-end setup."

Q. Does that mean you have been able to reduce your Excel dependence?


Casper: "Absolutely. We're not having to roll over spreadsheets and download the trial balances. We've sort of created an environment where if we decide we want to manage our balance sheet differently or we go through a process and acquire a business or whatever it might be we’ll be able to do it with speed and efficiency."

Q. How did Blackline implementation improve governance in your team?


Casper: "The governance really falls out of collaboration. The fact that you can track comments, the number of reconciling items and the age of such items help a lot. We can draft the action plan for the resolution of those items. But we're only about to come up to our third-month end with Blackline. So we’re yet to see it in full action as everyone at our organisation is getting used to it."

Q. Let’s step back and talk about the Risks that working with Excel introduced.


Casper: "There are a lot of risks involved while using Excel. But the major risk is accuracy. It's obviously very easy for someone to make a mistake in Excel. Mostly when you've got linked spreadsheets. You update a link while people are using lookups and pivoting tables. That increases the risk of error quite substantially.

There's also a commercial risk. Lots of items were just not getting resolved on a timely basis. Because with Excel we didn't have tools for any kind of reporting per se. All we had was the individual recs. And we'd have to go through the individual recs to identify the items and then as I mentioned earlier we’d try and figure out how old they are and what had happened to them while decoding through the comments that people had put in there.

Sometimes, there would be staff turnovers and we didn’t know what they meant when they put initials or color coding while working on the sheets."

Q. How has Blackline Reconciliation helped you mitigate these risks?


Casper: "With Blackline, you can very clearly have dashboards that are reporting on everything. Out of my 120 recs this is how many have reconciling items over this certain age and this is whom they belong to. You can then pinpoint and drill into the issues very quickly to see what action plan they've actually set up within Blackline to get it cleared."

Q. Can you give us a snapshot of your experience with the Blackline implementation process?


Casper: "Overall it went pretty well. I think that the difference between doing it here compared to doing it at News Corp was that they would generally throw money at it. Not just in terms of yeah we're going to pay for this system but also in terms of having a team of people focused on implementing this. Whereas with Tyro, we're a bit smaller and a bit more nimble.

We were working with Octane and our own employees were involved. Carving out people's time to focus on implementation was harder to do. We were holding ourselves accountable for delivering on our timetable.

I think overall there were times when I thought we were definitely not going to make it, but as you know in the end we did make it. So that was good."

Q.How long does it take to implement Blackline?


Casper: "Our implementation took probably around 6 to 8 weeks. I think that time can flex depending on how much time you can dedicate to the implementation from your side. The teams are stretched and so you can't really dedicate yourself full time to doing the blackline implementation."

Amendra: "We probably spend about under 20 days while implementing the Blackline Reconciliation. But sometimes we still have a few things to come back to. There are sometimes things like task management and everything else. A typical full implementation for a business of Tyro’s size is around 20 days or under."

Q. Is Blackline a GL system?


Amendra: "No, Blackline is not a General Ledger system. It sits on top of the GL systems bringing the relevant data that allows you to do your reconciliations at the month end. It helps you close your books quickly. Basically, it enhances your GL system. A typical GL system doesn’t have these functionalities."

Casper: "Just to add to that, we use it primarily for the preparation of the balance sheet reconciliations. Blackline ingests our General Ledger into its system. Then it enables an automated way to assign tasks, collaborate, and manage clearances of reconciling items while preparing recs. It’s a much cleaner system when compared to traditional Excel spreadsheets."

Q. Let’s talk about the benefits that you’ve realised after the Blackline implementation.


Casper: "We're only going into our third month. It’s hard to realize the benefits in the first couple of months because it's naturally just going to take people longer to get used to working with the system. But we clearly will be able to measure the length of time to achieve our month-end close.

We know how much we took before the Blackline Reconciliation, now we can target to complete it much earlier. The governance piece will become clearer over time once we actually start properly drilling down on the number of aged items. We'll be able to track it over time and see the number of reconciling items reduce.

We already have lots of anecdotal evidence of Blackline automating everything and facilitating collaboration among team members. As a whole, the morale of our team has been boosted as they’re not wasting their time on repetitive tasks. Moving forward, we’ll soon have benefits that we can empirically measure."



Four tips for companies adopting Blackline Reconciliation

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Caspar Deman, Tyro’s Finance Project Lead, shares his top four tips when considering Blackline Reconciliation. Caspar offers practical advice for Financial Controllers and Financial Accountants, looking to make financial transformation in their organisations.

Blackline reconciliation advice

Caspar advises companies adopting Blackline to think about the following:

  • Get rid of error-prone manual consolidations
  • Make it scalable (as early on as possible)
  • Be ready for one-off integration challenges
  • Manage expectations and timeline

Download the full case study at the end of this article.

1. Get rid of error-prone manual consolidations

At Tyro, the month-end financial close and consolidation was a complex and time-consuming task for the finance team. The growing business strained the team while closing the books manually with tight deadlines. It wasn’t really sustainable with such a thinly stretched team. Casper tells us how they were struggling with multiple versions of truth inside their organisation:


“All the balance sheet recs were housed in one shared document but the document was too big for more than one person to work on it at once so everyone had their own mini versions of the document.”

Casper recalls how it was like when all the reconciliations were prepared in Excel:


“We would download the trial balance from Workday, our ERP. All of it would be copied and pasted into the individual reconciliations. Once everyone had done their recs, we had to then wait until the master document was available. So that we could go in and then copy and paste all our recs out of our own documents into the main working document.”

After Blackline Reconciliation, Casper’s finance team has achieved time efficiency, accuracy, and speed. They were able to create a single truth for real-time reporting across all the functions. Casper says:


“With Blackline, you can very clearly know from your dashboards that you are reporting on 120 recs and how many of them have reconciling items over a certain age and whom they belong to. You can drill into it to see what action plan they've actually set up within Blackline to get it cleared enabling you to know and pinpoint issues and fix them quickly.”

2. Make it scalable (as early on as possible)

Casper suggests not waiting too long, to the point you're already in the mess. Organisations don't want to invest in financial transformation systems too early. They tend to come behind the investment in customer-facing systems and front-end systems.

But if you've got the opportunity and if you're going to be a growing business, start looking at Blackline or other productivity tools and try to get on board early. And then you can set yourself up with a solid set of standard processes that you can build on rather than trying to migrate once you outgrow the Excel spreadsheets. Casper pinpoints the problem with trying to make it work with Excel:


“We've around 100 balance sheet recs. You might think well that's not that many. I think for Tyro, we sort of chose to go a bit to an inflection point where we could have probably coped with our Excel process. But if we're gonna grow as a business, it would have quickly become unscalable and unmanageable.”

With Blackline software implementation, Tyro’s finance team is confident that they will be able to manage the high influx of data and still be able to automate consolidations moving forward.

3. Be ready for one-off integration challenges

Casper warns about the integration challenges while implementing Blackline:


“I think working out the integration between Blackline and our ERP–Workday was tricky. Because Blackline has to ingest the data in a certain format and it wasn't a standard reporting format that came out of Workday.”

So Tyro had to work on their side to figure out how to get the data in the appropriate format to ingest it into Blackline. Casper lays out a proper outline for the businesses looking into Blackline implementation:


“Understand that it's not just about the Blackline guys doing all the work to do the implementation. There is work to do on our side as well. Dealing with the tech people or the systems analysts on our side was relatively new to me. I didn't have such relationships and I had to build those relationships up and figure out whom to go to in order to get these all done. That was also a challenging component of the implementation on our side.”

4. Manage expectations and timeline

The best way to go about Blackline implementation is to first have a plan. Casper suggests you take control:


“As an implementation manager, you’ll have to establish a timeline based on your expectations. Try and carve out a plan that you'll follow throughout the process of configuration and providing your test data while implementing Blackline Software.”

Setting up everything along with security and assigning staff members the roles and activities during the implementation will take another huge chunk of time. So, your team needs to acknowledge everything while carving out the timeline ensuring the team members understand your expectations upfront. Casper is upfront about some of his shortcomings and what he learned throughout the process of Blackline implementation:


“Because I had not worked in a financial services environment before, I had to get an awful lot of internal sign-offs even before we could move to the implementation phase. Particularly in cyber security and risk compliance.”

As they were taking their general ledger data and sending it outside the building, there were a lot of checks that they had to do while taking clearances and filing up contracts upfront. It was a new experience for Casper.


“If you are looking into Blackline implementation would be to take these things into consideration while thinking about the timeline for implementation.”

Amendra Pratap, Managing Director at Octane backs Casper’s insight about planning:


“One thing that we found worked quite well with the tyro implementation was having a project plan and also having the agility to move around the project plan.”

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