month-end-close

name	month-end-close
description	Run a clean month-end / quarter-end close — close-calendar mechanics, JE buckets, reconciliation checklist, exception-triage playbook. Reconciliation before commentary; materiality as a design constraint. Used by `controller` (primary).

Skill: month-end-close

Purpose: Reference playbook for designing and running a clean month-end close. Used by controller (primary), occasionally by audit-prep-specialist and fpa-analyst when their work depends on a closed period.

When to use

• Designing a close calendar for a new entity or a refresh of an existing one
• Triaging a close that's slipping (where's the bottleneck, what's blocking)
• Reviewing JEs and accruals during close week
• Writing the post-close summary memo for management

The standard close calendar

Days are relative to month-end (Day 0). Adjust to your entity's actual close target.

Day	Workstream	Owner
Day -3 to Day -1	Cutoff communication: sales cutoff, expense cutoff, payroll cutoff confirmed	Controller
Day 0 (month-end)	Sub-ledgers run their period-end posting; physical inventory if applicable	Operations + Controller
Day 1	Sub-ledger posting tied to GL; bank statements pulled; AR / AP aging snapshots taken	Staff accountants
Day 2	Accruals booked: payroll (residual days), vendor invoices not received, customer revenue cutoff adjustments	Staff accountants
Day 3	Account recons: cash, AR, AP, accruals, prepaids, fixed assets	Staff + Senior accountants
Day 4	Intercompany matching + eliminations; foreign-currency translation; CTA bucket update	Senior accountants
Day 5	Top-side review: GL trial balance reviewed by controller; outlier JEs investigated	Controller
Day 6	Executive review: prelim P&L / BS reviewed with CFO; adjustments identified	Controller + CFO
Day 7	Final JEs posted (true-ups, reclasses); books "locked"	Controller
Day 7-10	Variance commentary; KPI pack assembled; board / investor reporting	FP&A

A 7-day close is typical for a mid-market entity with a competent team. Faster closes (3-5 days) require investment in automation; slower (10-15) usually indicates a fixable bottleneck.

JE buckets (what's normally booked during close)

1. Standard recurring: depreciation, amortization, lease accretion, intangible amortization
2. Cutoff accruals: expenses incurred but not yet invoiced (services, utilities, bonuses)
3. Revenue cutoff: deferred revenue release, unbilled revenue accruals
4. Reclasses: misclassified entries from earlier in the period (always with a memo)
5. Estimates and true-ups: prior-period estimates that need refinement (utilities estimates, audit-fee accruals)
6. Foreign currency: revaluation of FX-denominated balances, CTA bucket
7. Intercompany: matching entries + eliminations on consolidation
8. Capitalization decisions: items moved from expense to fixed asset (or vice versa) with memo

Reconciliation checklist

For every recon, the workpaper should show:

• Account name + GL number
• Period
• GL balance
• Source / sub-ledger balance
• Reconciling items (each with explanation + age)
• Variance (GL − Source, if any)
• Preparer signature + date
• Reviewer signature + date
• Source-doc references (file paths, ticket numbers, system exports)

Material reconciling items > 30 days old are escalated, not rolled forward.

Exception triage

When close slips, run this triage:

1. Where exactly is it stuck? Look at the close calendar — which day's workstream didn't complete?
2. Who owns the stuck workstream? If the owner is overloaded across multiple workstreams, that's a resource issue, not a process issue.
3. Is it a data problem or a decision problem?
   • Data: source system feed is broken / late / missing — fix the feed.
   • Decision: management can't agree on an accounting treatment — escalate to CFO before close, not after.
4. Is the bottleneck recurring? If the same workstream slips every close, that's the next quarter's automation target.

Documenting the close

After close, the controller publishes a short post-close memo to the management team:

• Did we close on target? If not, by how many days, and why?
• Material adjustments booked late in close (with rationale)
• Items deferred to next period (with target resolution date)
• Lessons / next-quarter improvements

This memo also feeds the audit walkthrough — auditors love a documented close process.

Anti-patterns

• A "close" that never actually finishes — books re-opened ad hoc for weeks afterward
• Close calendar that lives only in the controller's head
• "Plug" entries to make the books tie without a memo
• Sub-ledgers reconciling to themselves rather than to the GL
• Accruals that grow indefinitely without true-up
• Material items deferred to the next period with no documented owner / target date
• Top-side review skipped because "the numbers look fine"

See also

• Template: ../../templates/month-end-close-calendar.md
• Template: ../../templates/account-reconciliation.md
• Agent: ../../agents/controller.md
• Skill: ../variance-commentary/SKILL.md — for the post-close FP&A handoff