Process Library

Monthly Financial Close

A month-end close that reconciles accounts, books accruals, and produces a clean P&L and balance sheet on a predictable date.

Finance 6 steps
When to use

First week of each month, to close the prior month's books.

Trigger
Runs when: The first business days of a new month

The procedure

6 steps

  1. Reconcile every bank and credit-card account to the statement.
  2. Confirm all revenue is recognized in the correct period and deferred revenue is updated.
  3. Book accruals and prepaid amortization for the month.
  4. Review the expense ledger for miscoded or missing transactions.
  5. Produce the P&L, balance sheet, and cash-flow statement and review variances against budget.
  6. Lock the period and distribute the close package with a short variance commentary.
Outputs
  • Reconciled accounts
  • A locked P&L, balance sheet, and cash-flow statement
  • A variance commentary
Tools
Accounting systemBank feedsSpreadsheet
Note: Close on the same calendar day every month. A predictable close date is what lets the rest of the company plan around real numbers.
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Related searches
monthly close sop financial close process month end accounting reconciliation checklist bookkeeping sop

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