Month-End Close Checklist

Based on the “Mega Guide to Month-End Close,” here’s a straightforward, actionable checklist to help you close the books efficiently. It’s broken into the four core steps outlined in the guide—aim to tackle this monthly (or more frequently for smoother sailing). Check off as you go, and remember: cash is king, so prioritize accuracy to keep your financials credible.

1. Classify All Transactions to General Ledger Accounts

• Review all bank and credit card transactions for the period.
• Code each transaction to the appropriate GL account (e.g., Amazon purchase → Office Supplies).
• Include vendor/customer details in classifications for easy tracking.
• Bulk classify similar transactions (same category, vendor, or customer) to save time.
• Route uncertain transactions to an “Uncategorized” account for later review.
• Attach receipts to transactions—especially large ones—for full support.

2. Reconcile All Bank Accounts (and Credit Cards)

• Export bank/credit card statements for the period.
• Enter the ending bank balance in your accounting software and confirm the beginning balance matches.
• Match GL transactions to statement items—investigate and fix discrepancies:
  • Missing transactions? Add them.
  • Duplicates? Remove them.
  • Uncleared checks? Note and monitor.
• Address common issues: large datasets (review manually if needed), poor bank syncs (re-upload), or compromised data (double-check manual entries).
• Complete reconciliations for all accounts—aim for monthly, but weekly/daily for high-volume ops.

3. Book Adjusting Journal Entries

• Identify accruals/prepayments based on your accounting method (focus on accrual basis: record income/expenses when earned/incurred).
• Prepare workpapers with calculations to support each entry.
• Book common adjustments (as needed):
  • Prepaid Expenses: Amortize over periods (e.g., Debit Expense, Credit Prepaid).
  • Accrued Expenses: Record incurred but unbilled items (e.g., Debit Expense, Credit Accrued); reverse when billed.
  • Accrued Interest: Book unpaid debt interest (e.g., Debit Interest Expense, Credit Accrued Interest).
  • Depreciation: Allocate asset wear (e.g., Debit Depreciation Expense, Credit Accumulated Depreciation).
  • Inventory Adjustments: Move to/from COGS on purchase/sale (e.g., Debit Inventory, Credit Cash; then Debit COGS, Credit Inventory).
  • Deferred Revenue: Recognize as earned (e.g., Debit Deferred Revenue, Credit Revenue).
• Enter all AJEs in software and verify they tie to balance sheet impacts.

4. Confirm Accuracy & Final Review

• Review all Balance Sheet accounts: Confirm balances with supporting workpapers/docs.
• Scan key financials for anomalies:
  • Income Statement: Spot large swings or unexpected values.
  • Balance Sheet: Check for new/missing accounts.
  • Cash Flow: Ensure it aligns with operations.
• Drill down via detail reports (e.g., P&L Detail, Balance Sheet Detail) or click-throughs in software.
• Re-review all transaction classifications for accuracy.
• Sign off: Financials are reconciled and ready for presentation, analysis, or forecasting.

Once complete, you’re set to trust your numbers and focus on growth. Pro tip from the guide: Do mini-closes throughout the month (daily/weekly coding) to avoid end-of-month chaos. If this sparks questions, hit up your accounting team—or us at Caramel for outsourced muscle!