In many small companies the month-end close is one person's private routine. It works until that person is on holiday, the company grows, or a new colleague asks why the numbers are ready on the 12th this month and on the 20th the next.
A written checklist does not make the accounting easier. It makes the close predictable: everybody knows what they owe, by when, and in which order the work happens.
Why closes drag on
Three causes explain most delays:
- Late inputs. Supplier invoices, expense reports and timesheets arrive after the accountant has started.
- No fixed order. Reconciling bank accounts before all payments are recorded means doing it twice.
- No owner for the gaps. When an amount does not match, nobody knows whose question it is.
Step one: set the calendar
Pick a target for the close, for example the fifth working day of the next month, and work backwards. A simple calendar might look like this:
- Last working day of the month: sales invoices issued, cut-off for expenses and timesheets.
- Working day 1: supplier invoices and expense reports collected; bank and card statements downloaded.
- Working days 2–3: recording, reconciliation, accruals.
- Working day 4: five final checks and corrections.
- Working day 5: month locked, short summary sent to management.
The exact days depend on your size. What matters is that they are written down and the same every month.
Step two: define cut-off dates for colleagues
Most of the close depends on people outside finance. Send them a short, repeated message with three dates:
- Expense reports and receipts: by the last working day of the month.
- Supplier invoices received by e-mail or post: forwarded to one shared address by working day 1.
- Timesheets or delivery confirmations that drive invoicing: approved by the last working day.
Anything that arrives later belongs to the next month unless the owner of the checklist decides otherwise. A rule that is applied every time is better than a perfect rule applied sometimes.
Step three: give every step an owner
For each step in the checklist write one person and one deputy. A typical list for a small company:
| Step | Owner | Deputy |
|---|---|---|
| Issue all sales invoices for the month | Sales or operations lead | Office manager |
| Collect supplier invoices and expenses | Office manager | Finance |
| Record documents and payments | Bookkeeper | Finance |
| Reconcile bank, cards and cash | Bookkeeper | Finance |
| Accruals and prepayments | Finance | Managing director |
| Final checks and lock | Finance | Managing director |
If the work is outsourced to an external accountant, the checklist still needs an internal owner who sends the inputs and answers questions.
Step four: follow the same order
The order below avoids rework:
- Confirm that all sales invoices are issued and numbered without gaps.
- Record supplier invoices and expenses.
- Record payments from bank and card statements.
- Reconcile each bank account and card to its statement.
- Post accruals for work received but not yet invoiced, and prepayments for costs that belong to later months.
- Review open receivables and payables.
- Run the final checks and lock the month.
Keep the checklist as a shared document with a tick and a date next to every step. It also becomes the record of what was done.
Step five: five checks before locking the month
Spend twenty minutes on these before anything is closed:
- Bank balance matches the statement for each account, to the last cent.
- Invoice numbering has no gaps and no duplicates in sales and purchase ledgers. If your customer and supplier records contain duplicates, our article on cleaning up duplicate customer and supplier records can help.
- Receivables and payables ageing is reviewed. Anything unusually old has a note: disputed, forgotten or to be written off.
- Month-on-month comparison. Revenue and the five largest cost lines are compared with the previous month; any change above a threshold you set (say 20 %) has a one-line explanation.
- Recurring costs are all there. Compare against your list of regular payments and contracts. Our contract renewal calendar is a good source for that list.
Write down what you found, even if the answer is "nothing". Next month's close starts from it.
Step six: share a short summary
Management does not need the whole ledger. One page is enough: revenue, main costs, cash balance, open receivables and one or two comments on anything unusual. This summary can feed straight into your weekly operations meeting in the following week.
Step seven: improve after every close
Within a day of locking the month, ask three questions: what arrived late, what was done twice, and what surprised us? Change one thing in the checklist, a date, an owner or a reminder, and note the change. After three months the close usually takes noticeably fewer days, and you can see it in your own checklist dates.
Common mistakes
- Starting the reconciliation before all documents are recorded.
- Chasing colleagues individually instead of sending one standard reminder with fixed dates.
- Having an owner but no deputy for the key steps.
- Locking the month and then quietly changing numbers in it. Corrections should go into the current month with a note.
- Skipping the checks "because nothing changed".
Notes on accounting rules
Closing requirements, such as accruals, reporting deadlines and VAT filing, depend on your country and accounting standards. This article describes a working practice for organising the process, not accounting or tax advice. Agree the details with your accountant.
Summary
A month-end close checklist is a calendar, a list of cut-off dates, one owner and deputy per step, a fixed order and five final checks. It takes an afternoon to write, and each close then shows you which single step to improve next.
Sources
- Our related articles linked above.
- The calendar, cut-off dates and checks are a working practice for small companies, not an accounting standard; adjust them to your size, sector and local rules. No client results or market figures are claimed in this article.
