prepare-a-month-end-close

# prepare-a-month-end-close Use a controlled calendar and prove each material balance before locking the period. ## When to use - Use for monthly management accounts, consolidated reporting, audit support, or a close-process redesign. - Only authorized accountants may post, approve, reopen, or lock accounting periods. ## Preconditions - Confirm entities, ledgers, currencies, materiality, reporting deadline, owners, approvers, and system access. - Freeze the task list and preserve the prior close package as comparative evidence. ## Procedure 1. Publish the close calendar with dependencies, preparers, reviewers, due times, and escalation routes. 2. Confirm transaction cutoffs for sales, purchases, payroll, inventory, cash, and intercompany activity. 3. Reconcile bank, payment-processor, receivable, payable, payroll, inventory, fixed-asset, prepaid, deferred-revenue, tax, and debt balances. 4. Record accruals, deferrals, depreciation, allocations, foreign exchange, eliminations, and other approved journal entries with evidence. 5. Test duplicate, late, unbalanced, manual, unusual, and post-close entries. 6. Review the trial balance and account movements against budget, forecast, prior period, and operational measures. 7. Produce income statement, balance sheet, cash-flow, and supporting schedules with consistent mappings. 8. Resolve or formally carry forward exceptions with amount, impact, owner, deadline, and approval. 9. Obtain preparer and reviewer sign-offs, lock the period, and record any authorized reopening. 10. Run a close retrospective and update only controlled procedures. ## Failure plan - If a subledger does not reconcile, quantify the difference and do not conceal it with an unsupported journal. - If source data is late, issue a controlled estimate with reversal and review requirements. - If unauthorized activity appears, preserve evidence and use the approved investigation route. ## Worked example During close, processor cash is $31,000 below the ledger. The reconciliation separates a weekend payout in transit, refunds posted after cutoff, and a duplicated import. The authorized correction removes the duplicate, the timing item is carried with proof of later settlement, and the close package records the exact residual risk before the controller locks the period. ## Done - A close package contains the calendar, reconciliations, entries, trial balance, statements, variance review, sign-offs, and lock evidence - An exception register proves every unresolved amount, estimate, late item, reopening, and remediation owner