| 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)
- Standard recurring: depreciation, amortization, lease accretion, intangible amortization
- Cutoff accruals: expenses incurred but not yet invoiced (services, utilities, bonuses)
- Revenue cutoff: deferred revenue release, unbilled revenue accruals
- Reclasses: misclassified entries from earlier in the period (always with a memo)
- Estimates and true-ups: prior-period estimates that need refinement (utilities estimates, audit-fee accruals)
- Foreign currency: revaluation of FX-denominated balances, CTA bucket
- Intercompany: matching entries + eliminations on consolidation
- Capitalization decisions: items moved from expense to fixed asset (or vice versa) with memo
Reconciliation checklist
For every recon, the workpaper should show:
Material reconciling items > 30 days old are escalated, not rolled forward.
Exception triage
When close slips, run this triage:
- Where exactly is it stuck? Look at the close calendar — which day's workstream didn't complete?
- Who owns the stuck workstream? If the owner is overloaded across multiple workstreams, that's a resource issue, not a process issue.
- 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.
- 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
