A good month-end close follows the same steps every month: record all transactions, reconcile bank and card accounts, review receivables and payables, post accruals, prepayments and depreciation, reconcile balance sheet accounts, review the P&L for anomalies, then lock the period and produce reports. Most small businesses can close within 5–10 working days.
A consistent month-end close is the foundation of reliable reporting, tax compliance and good decisions. Use this checklist every month.
1. Capture every transaction
- Process all sales invoices and credit notes
- Enter or approve all supplier bills and expense claims
- Record payroll journals
- Check that bank feeds have imported fully
2. Reconcile cash
- Reconcile every bank, card and payment-processor account (Stripe, PayPal, Shopify Payments)
- Investigate and clear unreconciled items
3. Review receivables and payables
- Age accounts receivable and chase overdue invoices
- Review accounts payable for duplicates and missing bills
- Assess any doubtful debts
4. Post adjustments
- Accruals for costs incurred but not yet billed
- Prepayments for costs paid in advance
- Deferred revenue for income received before it's earned
- Depreciation and amortisation
- Inventory adjustments
5. Reconcile the balance sheet
- VAT, GST/HST or sales tax control accounts against returns
- Payroll liabilities against payroll reports
- Loans against lender statements
- Intercompany balances, if you have more than one entity
6. Review and report
- Compare the P&L with budget and last month and investigate big variances
- Produce management accounts and KPIs
- Lock the period
How Avore Solutions can help
Our outsourced bookkeeping and month-end close service delivers reconciled books and a management pack every month. Book a free consultation.
Frequently asked questions
How long should month-end close take?
Many small and mid-sized businesses aim to close within 5 to 10 working days. Automation, bank feeds and a fixed checklist can shorten it further.
What is the most important month-end task?
Bank reconciliation. If cash doesn't reconcile, nothing else in the accounts can be trusted.
Should I lock the accounting period after closing?
Yes. Locking the period in your accounting software prevents accidental changes to reported numbers.