Article
How to streamline reporting with a month-end close checklist
Jan. 10, 2024 · Authored by Kanika Hasija
Efficient reporting is key to business health. The month-end closing period is typically an area that causes delays and obstructs reporting operations.
Fortunately, a month-end close checklist can help streamline the closing process, facilitating swift decision-making and transparency, while promoting efficiency and teamwork. Additionally, it strengthens audit readiness by providing a trail for external auditors.
Explore items to keep front of mind during the process and execute a checklist for your business below.
Month-end close processes
The following example month-end close checklist may help streamline processes and foster continuous improvement. Adding it to your monthly operations not only may help you protect the integrity of your financial data but may also help you lay the foundation for sustainable growth and success.
Standardizing your month-end close processes also makes space for regular reviews and updates that can allow your organization to enhance processes, enhance controls, and reduce costs.
Example month-end close checklist
| S. No. | Particulars | Task Type | Description | Frequency | Close Day | Owner | Prepared by | Prepared Date | Reviewed By | Reviewed Date |
| 1. | Pre-Close Activities | |||||||||
| Meeting | Pre-close meeting | Monthly | ||||||||
| Clerical | Update month-end/quarter-end close calendar | Monthly | ||||||||
| 2. | Record Journal Entries | |||||||||
| JE/RJE | Review Journal Entry Report for the Month | Monthly | ||||||||
| 3. | Prepare and Review Reconciliations | |||||||||
| Schedule | Bank Accounts | Monthly | ||||||||
| Schedule | Petty Cash | Monthly | ||||||||
| Schedule | Cash Receipt | Monthly | ||||||||
| Schedule | Investment Accounts | Monthly/Quarterly | ||||||||
| Schedule | Accounts Receivable | Monthly | ||||||||
| Schedule | Allowance for Doubtful Accounts | Monthly | ||||||||
| Schedule | Credit Card Statements | Monthly | ||||||||
| Schedule | Equity Accounts | Monthly | ||||||||
| Schedule | Debt | Monthly | ||||||||
| Schedule | Accounts Payable | Monthly | ||||||||
| Schedule | Inventory | Monthly | ||||||||
| Schedule | Fixed Assets | Monthly | ||||||||
| Schedule | Prepaid (Rent, Inventory, Etc.) | Monthly | ||||||||
| Schedule | Any Other Asset or Liability Accounts | Monthly | ||||||||
| Schedule | Payroll Reconciliation | Semi-Monthly/Monthly | ||||||||
| Schedule | Deferred Rent | Monthly | ||||||||
| 4. | Cash and Cash Equivalents Tasks | |||||||||
| Clerical | Book Internal / Intercompany Bank transfers | Monthly | ||||||||
| Clerical | Save copies of all bank statements | Monthly | ||||||||
| Clerical | Print cash receipts summary reports after final day's receipts are recorded | Monthly | ||||||||
| Clerical | Close cash receipts and post to General Ledger (GL) | Monthly | ||||||||
| Schedule | Review and approve bank reconciliations; ensure all reconciling items have been researched and properly resolved | Monthly | ||||||||
| Process/ Schedule | Review escrow account details (where applicable) | Monthly | ||||||||
| Process/ Schedule | Confirm Balance Sheet classification of restricted cash (if applicable) | Monthly | ||||||||
| 5. | Investment Tasks | |||||||||
| Clerical | Obtain investment statements | Monthly/Quarterly | ||||||||
| Process/ Schedule | Verify reasonableness of calculated realized and unrealized gain/loss | Monthly/Quarterly | ||||||||
| JE/RJE | Reclass balance from money market account & record interest receivable on investments JE | Monthly/Quarterly | ||||||||
| Schedule | Disclosure: create the SEC fair value disclosure, including an analysis on classification levels | Quarterly | ||||||||
| Schedule | Reconcile all investment activities for the period | Monthly/Quarterly | ||||||||
| 6. | Accounts Receivable Tasks | |||||||||
| Process/ Schedule | Agree warranty receivable and warranty pending to warranty system reports | Monthly | ||||||||
| Process/ Schedule | Run and review invoice report for unapproved invoices at cutoff | Monthly | ||||||||
| Clerical | Generate A/R Aging report | Monthly | ||||||||
| Process/ Schedule | Review A/R Aging report and determine strategy for collection or write-off of aging A/R | Monthly | ||||||||
| Schedule | Review accounts receivable aging for any unapplied credits | Monthly | ||||||||
| Schedule | Rollforward prior period Master Billing Schedule and update for contracts closed in the month | Monthly | ||||||||
| Schedule | Prepare and review Sales Return Reserve based on company's policy | Monthly | ||||||||
| 7. | Inventory Tasks | |||||||||
| Clerical/Schedule | Inventory count and review | Monthly/Quarterly/Yearly | ||||||||
| Schedule | Calculation of inventory obsolescence | Monthly | ||||||||
| Schedule | Inventory in transit analysis | Monthly | ||||||||
| Process/ Schedule | Validate inventory EOM (End of Month) report to GL | Monthly | ||||||||
| Schedule | Calculation of inventory shrink estimates | Monthly | ||||||||
| Process/ Schedule | Perform perpetual inventory subledger review to ensure all goods activity confirmations were properly posted to the GL. Investigate any errors as needed and resolve in a timely manner | Monthly | ||||||||
| Process/ Schedule | Review perpetual inventory listing for reasonableness (high quantities, high dollars, etc.) | Monthly | ||||||||
| Clerical | Obtain supporting schedules to validate consignment inventory balances, if any | Monthly | ||||||||
| 8. | Fixed Assets Tasks | |||||||||
| Schedule | Fixed asset & Intangible asset rollforward review | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Review new purchases made in the previous month to verify they have been recorded properly with the correct depreciation schedule | Monthly | ||||||||
| Process/ Schedule | Review disposals of fixed assets and remove from fixed asset records | Monthly | ||||||||
| Process/ Schedule | Fixed assets write-offs and impairment reviews | Monthly | ||||||||
| Process/ Schedule | Review CIP accounts, if applicable | Monthly | ||||||||
| Clerical | Run depreciation in the system, review results for any significant errors | Monthly | ||||||||
| Process/ Schedule | Perform a reasonableness test of current period additions relative to total accumulated depreciation | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Perform annual fixed asset physical verification and verify all assets are properly tagged | Monthly/Quarterly/Yearly | ||||||||
| 9. | Other Assets Tasks | |||||||||
| Schedule | Update prepaid expense schedules (newly added and fully amortized items) | Monthly | ||||||||
| Process/ Schedule | Determine and review proper classifications of assets | Monthly | ||||||||
| Process/ Schedule | Review expense coding & calculate current period amortization (CMO, prepaid materials, and pre-commercial manufacturing services) | Monthly | ||||||||
| 10. | Accounts Payable & Accruals Tasks | |||||||||
| Clerical | Verify with AP that all invoices are appropriately accounted | Monthly | ||||||||
| Schedule | Reconcile Credit Cards to AP transactions | Monthly | ||||||||
| Accrual | Review for AP Accruals from late entry AP Invoices | Monthly | ||||||||
| Clerical | Run Payroll Report for Employee Expense (EE) in system | Monthly | ||||||||
| Clerical | CMO (Contract Manufacturing Organizations) Vendors confirmation if applicable | Monthly | ||||||||
| Clerical | Coordinate with Purchasing on AP close timeline - no conversion to PO on Day -1, clean up POs to close list | Monthly | ||||||||
| Process/ Schedule | Provide active employees' list for EE Accruals | Monthly | ||||||||
| Process/ Schedule | Obtain Headcount confirmation from HR | Monthly | ||||||||
| Accrual | Bonus Accrual | Monthly | ||||||||
| Accrual | PTO Accrual | Monthly | ||||||||
| Accrual | Payroll, Off-cycle Accruals | Monthly | ||||||||
| Accrual | Performance Based Stock Expenses Accrual | Monthly | ||||||||
| Accrual | Non-EE Stock Compensation | Monthly | ||||||||
| Accrual | Office supplies | Monthly | ||||||||
| Accrual | Option Modification Expense | Monthly | ||||||||
| Accrual | Sales Tax Payable (if applicable) | Monthly | ||||||||
| Accrual | Obtain confirmation from Legal vendors and Head of Legal | Monthly | ||||||||
| Accrual | Obtain confirmation from Consultants | Monthly | ||||||||
| Accrual | Obtain confirmation from vendors | Monthly | ||||||||
| Accrual | Obtain confirmation from employees | Monthly | ||||||||
| Accrual | Distribute Open PO report to the team for accrual (EOD) | Monthly | ||||||||
| Accrual | Commercial Mfg. Accrual | Monthly | ||||||||
| Process/ Schedule | Review AP Aging summary | Monthly | ||||||||
| Process/ Schedule | Search for Unrecorded Liabilities | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Review invoices received after cutoff | Monthly | ||||||||
| Process/ Schedule | Review Outstanding Checks not cashed | Monthly | ||||||||
| Process/ Schedule | Review if there is any payment that was made without being processed in the system | Monthly | ||||||||
| Process/ Schedule | FV Adj. to Contingent Consideration | Monthly | ||||||||
| Clerical | Submit all employee expense reports (Including original backup documentation) and vendor invoices to finance | Monthly | ||||||||
| Schedule | Review credit card statements and other reimbursement expense reports; match to supporting documentation for approved travel and other reimbursement expenses; verify coding | Monthly | ||||||||
| Clerical | Request Statement of Accounts (SOAs) from all applicable vendors | Monthly | ||||||||
| JE | Review and post all non-PO invoices | Monthly | ||||||||
| Schedule | Generate and review AP Aging for non-standard terms. | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Review AP aging for any unapplied credits | Monthly | ||||||||
| Process/ Schedule | Review AP Aging report and evaluate any negative if this needs to be reclassed to "Account Receivables" | Monthly | ||||||||
| Process/ Schedule | Review reconciliation of Open POs | Monthly | ||||||||
| Schedule | Calculate current period Days Payable Outstanding (DPOs) to monitor aging performance | Monthly | ||||||||
| Clerical | Email various department heads for any one-time, significant estimates for unvouchered services rendered to date | Monthly | ||||||||
| Process/ Schedule | Confirm reasonableness of outstanding service periods by cross referencing to invoices posted in AP | Monthly | ||||||||
| 11. | Deferred Liabilities Tasks | |||||||||
| Process/ Schedule | Prepare and review Short Term Deferred Revenue schedule | Monthly | ||||||||
| Process/ Schedule | Prepare and review Long Term Deferred Revenue schedule | Monthly | ||||||||
| 12. | Other Tasks | |||||||||
| Process/ Schedule | Memo for unusual or significant transaction (if applicable) | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Facilities Allocation (including depreciation) | Monthly | ||||||||
| Clerical | Run the program specific P&L report | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Update Month-end FX rates sourced from OANDA/Bloomberg/etc. | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | FX transaction adjustments (GL Posting date) if applicable | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Accretion of debt/notes discount | Monthly/Quarterly/Yearly | ||||||||
| 13. | Financial Reporting - Internal Tasks | |||||||||
| Process/ Schedule | Flux Analysis | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Prepare reports to Joint Ventures | Monthly/Quarterly/Yearly | ||||||||
| Process/ Schedule | Perform debt covenant calculations | Quarterly | ||||||||
| Process/ Schedule | Prepare and Review Consolidated Trial Balance | Monthly/Quarterly | ||||||||
| Process/ Schedule | Perform and review gross margin analysis | Quarterly/Yearly | ||||||||
| Process/ Schedule | Compile all relevant monthly metrics for CEO package | Monthly | ||||||||
| Process/ Schedule | Generate final financial statements for CFO (BS, IS and Cash Flow) | Quarterly | ||||||||
| 14. | Financial Reporting - External Tasks | |||||||||
| Meeting | Preliminary close meeting | Quarterly | ||||||||
| Process/ Schedule | Prepare Shareholder equity Rollforward | Quarterly | ||||||||
| Process/ Schedule | Calculate Earning Per Share | Quarterly | ||||||||
| Process/ Schedule | Prepare and review 10Q/10K package | Quarterly | ||||||||
| Process/ Schedule | Complete GAAP Disclosure Checklist | Quarterly | ||||||||
| Clerical | Refresh and publish FINAL financial statements | Quarterly | ||||||||
| Process/ Schedule | Disclosure committee review of financial statements | Quarterly | ||||||||
| Process/ Schedule | Outside legal counsel review of financial statements | Quarterly | ||||||||
| Process/ Schedule | SOX Questionnaire due | Quarterly | ||||||||
| Meeting | Final close meeting | Quarterly | ||||||||
| Meeting | Create audit committee slides and review with CFO for distribution to auditors and Board | Quarterly | ||||||||
| Meeting | Audit committee meeting | Quarterly | ||||||||
| Meeting | BOD Meeting | Quarterly | ||||||||
| Meeting | Board and Compensation Committee Meeting | Quarterly | ||||||||
| Process/ Schedule | Press Release to announce Earnings | Quarterly | ||||||||
| Process | Review SEC EDGAR version of 10Q/10K | Quarterly | ||||||||
| Process/ Schedule | 10Q/10K Due | Quarterly | ||||||||
| 15. | Tax Tasks | |||||||||
| Process/ Schedule | Prepare and review tax memorandum | Quarterly | ||||||||
| Process/ Schedule | Prepare and review tax returns | Monthly/Quarterly | ||||||||
| Process/ Schedule | Review tax provisions and journals entries | Monthly | ||||||||
| 16. | Accounting Close Controls | |||||||||
| Process/ Schedule | Month to Date (MTD) & Year to Date (YTD) Budget to Actuals | Monthly | ||||||||
| Process/ Schedule | Review additions/modifications/deletions to chart of accounts, profit centers, and entities | Quarterly | ||||||||
| Process/ Schedule | Update and review related party transaction listing | Quarterly | ||||||||
| Process/ Schedule | Perform user access review and Segregation of Duties analysis | Quarterly/Annually | ||||||||
