A practical month-end close checklist
A reliable month-end close turns daily records into numbers you can trust. The exact steps vary by business, but this checklist covers the essentials.
Record all transactions. Make sure sales, purchases, expenses and payroll for the month are entered and coded.
Reconcile bank and cash accounts. Every account should agree to the statement, with any differences explained.
Review receivables and payables. Check ageing reports, follow up overdue invoices and confirm supplier balances.
Post accruals and prepayments. Match costs and income to the period they belong to, not the month they were paid.
Update fixed assets and depreciation. Record additions and disposals, then post the month’s charge.
Reconcile control accounts. Tax, payroll liabilities, loans and inter-company balances should all be supported.
Review the profit and loss. Compare against the budget and the prior month, and investigate unusual movements.
Review the balance sheet. Look for balances that do not make sense, such as negative stock or old unreconciled items.
Lock the period. Once reviewed, close the month so figures do not change unnoticed.
Issue the reporting pack. A short summary of results, cash and key ratios helps owners act on the numbers.
Consistency matters more than speed. Choose a target working day for completing the close, document the steps, and repeat the process every month. Over time it becomes faster and the numbers become more dependable.