Accounting Checklist for Monthly Close: Expert Tips

When it comes to the accounting checklist for monthly close, a small improvement can mean a lot. The month-end close process is critical to make smart decisions, remain compliant, and understand how your business is doing financially, so we’re going to look at month-end close best practices.

We’ll also see how using a financial automation solution like SolveXia can save you time, money, and prevent costly mistakes from being made.

Coming Up

What is the Month-End Close Process?

What are the Benefits of the Month End Close Process?

What are the Steps in the Month End Close Process?

What is the Accounting Checklist for Monthly Close?

What are the Benefits of Accounting Checklist for Monthly Close?

What are Common Mistakes for Month End Close?

What are Best Practices for the Month End Close Process?

What Tasks Can You Automate in Month End Close?

Wrap Up

What is the Month-End Close Process?

The month-end close process is a set of steps by which the accounting and finance team collect, check, reconcile, and report financial activity and review transactions.

The month-end close process is crucial for many reasons. It helps to ensure that the business is remaining compliant. Importantly, it can also aid in making sure that the company is upholding their data’s integrity for analysis planning.

Many teams will rely on a month-end accounting checklist template so that nothing falls through the cracks as there are many moving parts. Additionally, the use of finance automation tools can streamline and automate many of the required steps of the month-end close process.

For example, with an automation solution like SolveXia by using their automated reconciliations and reporting, teams can boost their productivity by 85x.

What are the Benefits of the Month End Close Process?

For some businesses, the month-end close process is regulated and required. Whether or not it’s legally required, it’s necessary and beneficial for all businesses to perform in order to prosper.

By fulfilling the accounting checklist for monthly close, companies stand to gain multiple benefits, including:

• Access to accurate and up-to-date records
• Streamlined tax filings with financial statements in good order
• Easier audits because of organized paperwork and reports
• The ability to make informed decisions on the spot

Not only do accurate financial statements help the business to make better decisions, but they are also used to attract new investors, lenders, and business partners.

What are the Steps in the Month End Close Process?

While every business runs differently, the month end close process and its steps will look somewhat the same. Let’s look at the 5 steps in this general overview. By doing so, we can also see where and how Solvexia’s finance automation suite of solutions can be of service.

1. Collect Information

The first step is to collect all the data, statements, and information required to conduct the financial close process.

If you’re storing financial data across multiple systems, including payment processors and have a high volume of transactions, this step in itself can be time-consuming.

Instead, a financial automation tool like SolveXia can automatically connect all your data systems and pull the information you need to run real time reconciliations.

This is helpful for all businesses, but especially for those that are reconciling across multiple payment providers (i.e. PayPal, Amazon, eBay, Worldplay, Stripe, and more) and dealing with a high volume of transactions.

2. Reconcile Data

Once the data is in front of your team, it’s time to ensure that statements and balances are in alignment with one another. The reconciliation process is data-heavy and requires utmost attention to detail. A finance automation tool automatically cross-checks data and notifies your team if something needs attention.

3. Assess Assets

Once everything is in order in terms of balances, it’s also important to review fixed assets, such as equipment and storage.

4. Create Financial Statements

With all the verified information in order, you can create your financial statements.

5. Final Review

Since the month-end close process is so important, it’s good practice to conduct a final review and approval before it’s considered done.

What is the Accounting Checklist for Monthly Close?

As you can tell, every business’ month-end close process runs at their own pace and in their own way. This month-end accounting checklist template is intended to relieve the chance of anything falling through the cracks:

1. Set a Closing Schedule

With so many moving parts every month, you don’t want to procrastinate the month-end close process and be stuck rushing to piece it all together. Instead, it’s useful to prioritize tasks according to deadlines and set a closing schedule up in advance.

2. Record Sales

As each transaction takes place, list incoming revenue totals, along with their sources. Keep an eye on invoices and bank statements to ensure outstanding customer payments get paid.

Automation software can also take care of this for you by updating records as you go and following up, if need be.

3. Perform Reconciliation

The more often you perform reconciliation, the less hectic it will become. Since reconciliation is often the most time-consuming step of the month-end close process, many businesses are leveraging tools like SolveXia that streamline all types of reconciliation for you.

4. Review Petty Cash and Inventory

Keep an eye on petty cash reserves, including the reconciliation of petty cash. The same can be said about inventory documentation.

5. Financial Reports

Ultimately, the end goal is to have financial reports that are in good standing and accurate. Having timely and trustworthy reports is key for executives and stakeholders to be able to make business decisions for the upcoming fiscal period.

With SolveXia, you can bank on having reports and statements with 90% fewer errors than you’d otherwise have through manual efforts.

What are the Benefits of Accounting Checklist for Monthly Close?

There’s a best-selling book entitled, The Checklist Manifesto that talks all about the value of checklists across key industries.

When it comes to having an accounting checklist for monthly close, the author’s main point is entirely applicable - checklists support success! The month-end close process is filled with a lot of information and necessitates adequate attention.

That being said, your accounting and finance teams already have a lot on their plate to handle. An accounting checklist fo the month-end close alleviates their burden by:

1. Ensuring Accurate Data

Since the month-end close checklist covers reconciliation, you can increase your confidence levels in your business’ financial data. This data is at the heart of so many big decisions, so it’s a big relief to be able to trust the numbers and analysis in front of you.

2. Creating a Standardized Process

With a checklist in place, everyone involved can be in support of a standardized process. Furthermore, the use of automation software solidifies standardization as the process moves through each step according to the system’s process map and defined flow.

3. Tracking Balances

With the month-end close process, you can keep track of balances that affect the business, such as cash and inventory, on a month-to-month basis.

4. Meeting Deadlines

Perhaps most importantly, a neatly defined and organized month-end close process means that you will be able to meet critical deadlines.

What are Common Mistakes for Month End Close?

No matter how many times your business performs the month-end close process, there are some common mistakes that occur. It’s the nature of the process as it’s data-heavy and time-sensitive, which when manually handled, is a recipe to be error-prone.

Mistakes can include:

1. Duplicate Data

If you’re stuck manually entering data, then it’s inevitable something will go wrong. This may mean duplicate data entry. Rather, a system like SolveXia will automatically input data between systems to expedite the month-end close process with ease.

2. Lack of Standardization

As remote work grows in popularity, it’s increasingly challenging to retain oversight and internal control when teams are working manually and in disparate systems. On the other hand, a standardized and automated process will result in consistent results month-in and month-out.

3. Late Information and Frustrated Staff

Delays and bottlenecks are going to bog down your team and frustrate their workflows. Efficiency is key when it comes to the month-end close process.

An automation solution like SolveXia guarantees that you always have access to the most up-to-date data, while the software will remove key person dependencies and cut out bottlenecks.

What are Best Practices for the Month End Close Process?

Any business anywhere will agree that improving the month-end close process and being able to fulfill the accounting checklist for monthly close with ease is desired.

However you choose to move towards improvement, here are some key best practices to keep in mind:

• Prioritize accuracy always. The month-end close process is time-sensitive, so prepare in advance so you don’t have to rush or make mistakes at the last minute.

• Set weekly goals and communicate them with team members so everyone is aware of the timeline before the clock starts to tick.

• Connect your data and teams so that information is never siloed, as that can create chaos. The use of automation software can take care of this immediately.

• Leverage automation software wherever possible. A tool like SolveXia offers an out-of-the-box, no-code solution that can be deployed in under 30 minutes without the need for a dedicated IT team. It’s easy for anyone to use with an intuitive interface, and it can be applied for multiple finance functions and use cases, including: expense management, rebates, regulatory reporting, reconciliation, and more.

What Tasks Can You Automate in Month End Close?

We’ve touched on this sporadically throughout this article, but when we say automation software can dramatically transform your month-end close process for the better, we mean it.

That’s because you can automate pretty much every major step of the month-end close checklist, such as:

• Data collection
• Transaction matching
• Reconciliation
• Reporting
• Approval processes
• Analysis

By being able to streamline the time-consuming aspects of the month-end close process, your team boosts productivity, increases efficiency, enhances job satisfaction, and can allocate more time to performing value-add responsibilities.

Wrap Up

Automating your accounting checklist for monthly close allows your business to operate with efficiency and gain a competitive advantage to prosper. An automation solution like SolveXia enchances your team’s capabilities to do more in less time with greater accuracy.

With automated software implemented, you can experience 90x less errors in your data, 85x faster processes, and 24/7 access to updated, secure data.

Ready to see how a tool like SolveXia works in action and can take your month-end close process to the next level? Request a demo today!