What happens if a company fails to configure journal sequencing properly in Workday?

If a company fails to configure journal sequencing properly in Workday, it can result in journal entries that do not comply with audit requirements. This compliance is crucial for maintaining financial integrity and ensuring that all transactions can be traced accurately for review processes. Proper journal sequencing allows for organized record-keeping, which is essential during audits to demonstrate that the company has adhered to necessary financial reporting standards. Without a well-defined sequence, there may be gaps or irregularities in the journal entries, which can lead to potential issues during an audit examination, including questions regarding the validity and authenticity of financial data. Therefore, maintaining accurate journal sequencing is vital for compliance, as it helps ensure transparency and accountability in financial reporting.