Your 10-Step Month End Checklist: Monthly Accounting Made Easy

With a simple Google search, you'll probably find countless month end close best practices. To make it easier, we've compiled a monthly closing checklist you can download and follow along. Streamline your month-end closing process with this comprehensive 10-step accounts checklist:

1. Close outstanding purchase orders (POs)

Efficiently match POs with invoices, approving payments or cancelling unused POs. This way, you'll be able to reduce any discrepancies and improve your team's workflow. Learn how choosing the right PO system will make everyone's jobs easier.

2. Process accounts payable

Code and process supplier invoices, staff expense claims, and other outgoing payments to stay on track. This can involve reviewing documentation, making sure everything's in place and getting the approvals you need for a smooth month end.

3. Send sales invoices promptly

Stay on top of incoming sales invoices to ensure accurate month-end balancing.

Pro tip: Make sure you schedule time regularly to review these invoices ahead of your deadlines. This allows for timely identification of any discrepancies and making sure the data is perfectly accurate each time.

See how using the best invoicing software for your company can streamline sales processing.

4. Reconcile aged debtors and creditors

Run reports to identify overdue payments and discrepancies between income and trial balance. Ideally, this would involve cross-referencing data sources to identify any potential issues (some that may require your immediate attention). The good news is that many tools can help you automate as much of the process as possible. Learn more about financial reporting and how you can make the most out of your month end reporting.

5. Complete banking tasks

Conduct a monthly count of petty cash and document all banking activities. This includes handling credit card payments and preparing a detailed report. Create a report or a financial dashboard view that enables stakeholders to review the information, preferably including summaries of both cash expenditures and banking transactions.

6. Monitor fixed assets

Keep your fixed-asset register up-to-date with regular monitoring. Why? Conducting regular updates will help you manage your assets more effectively and be more confident in your business decisions. Read our article to learn more about what a fixed asset register is and what the whole process involves.

7. Reconcile income

Verify that your income totals align with monthly remittance advice slips. This ensures that all reported earnings are aligned and accounted for properly and that there are no compliance issues.

8. Reconcile VAT

Double-check entries for accuracy before submission, ensuring the VAT control account matches the total on your VAT claim. Visit the Master VAT on Expenses resource hub and get a hold of exclusive industry insights, tips and best practices.

9. Reconcile payroll

Report any payroll errors to your provider, and confirm that the balance on the control account matches unpaid payments for the latest payroll cycle. See how specialised Payroll software can help you stay on track.

10. Produce comprehensive month end reports

When preparing your month end financial reports, include a trial balance, income and expenditure account, cash flow statement, and balance sheet in your reports. Keep it simple but accurate; your data needs to be up-to-date and relevant. You wouldn't use old or spoiled ingredients to make yourself a meal. Just like that, relying on outdated data can lead to poor and misguided decisions. Discover how real-time reporting software can help with data accuracy.

Reviewing and closing the financial period at month-end provides you with the opportunity to assess business progress and keep track of profitability, cash flow, and performance.

It’s also good to think creatively about what could make month-end easier. For example, introducing cut-off dates for invoices or expenses makes it clear to the whole business what their responsibilities are and how they can help.

A consistent approach also makes it easier when staff leave and new people start as the expectations are clear.

Think about how accounting software might help too. Producing reports, analysing data, and even populating documents with finance information can all be done much more easily. Ultimately, with the right tools and processes in place, your month-end close can be smooth and stress-free.

Explore our financial year end hub and discover a host of useful information including tips and best practices for Finance teams, year-end guidance, and tools, as well as insight into key priorities and trends for the coming year.