The step-by-step process we use with clients to close the books accurately and efficiently every month.
Verify the last day for processing transactions in the current period.
Gather missing receipts, invoices, and expense reports before close begins.
Pull final statements for all accounts as soon as available after month-end.
Match book balance to bank statement balance, investigate all discrepancies.
Verify all charges are recorded and properly categorized.
Investigate items outstanding for more than 30 days.
Ensure revenue is recognized per your accounting policy (ASC 606 if applicable).
Follow up on overdue invoices, assess need for bad debt reserve.
Adjust for prepaid subscriptions and unearned revenue.
Enter any invoices received for goods or services in the period.
Estimate and record expenses incurred but not yet invoiced.
Verify balances and identify items to pay.
Review, approve, and record all submitted expense reports.
Verify payroll journal entries match payroll reports.
Record wages earned but not yet paid at month-end.
Verify all benefit costs are properly recorded.
Record monthly amortization for insurance, software, and other prepaids.
Calculate and record monthly depreciation on fixed assets.
Verify debits equal credits and review account balances.
Generate P&L, balance sheet, and cash flow statement.
Compare to budget and prior periods, investigate significant variances.
Present financials for review and lock the period.
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