The 21-Step Monthly Close Checklist

The same close process our outsourced bookkeeping team runs for 500+ businesses - free to use, print, or adapt. Tick the boxes as you go; printing gives you a clean one-pager for your files.

Banking & cash Steps 1–5

1. Reconcile every bank accountMatch the bank statement to the ledger; investigate anything outstanding longer than 30 days.
2. Reconcile credit card accountsConfirm statement balances tie to the ledger and all charges are coded.
3. Reconcile merchant / payment processorsStripe, PayPal, POS settlements - fees booked, payouts matched to deposits.
4. Review undeposited fundsThe account should clear to zero; stale items mean a recording error.
5. Book petty cash and clear suspenseNo balances should sit in suspense or "ask my accountant" accounts at close.

Receivables & payables Steps 6–10

1. Send all customer invoicesEverything earned in the month is invoiced in the month.
2. Review AR agingChase overdue balances; flag doubtful accounts for an allowance.
3. Enter all vendor billsIncluding recurring bills and anything sitting in approval queues.
4. Review AP agingConfirm what's due, schedule payments, and capture early-payment discounts.
5. Match POs, receipts, and billsThree-way match for inventory purchases; investigate variances.

Payroll & accruals Steps 11–15

1. Tie payroll reports to the ledgerGross wages, employer taxes, and benefits per the payroll provider must match the books. Our payroll service does this every cycle.
2. Accrue unpaid wages and PTOFor pay periods straddling month-end.
3. Book payroll tax liabilitiesConfirm 941/940 and state liabilities reconcile to filings.
4. Record expense accruals and prepaidsRecognize expenses in the month incurred; amortize prepaid balances.
5. Book depreciation and amortizationRun the fixed-asset schedule; add the month's additions and disposals.

Review & reporting Steps 16–21

1. Reconcile balance-sheet accountsEvery balance-sheet line gets a supporting schedule or reconciliation.
2. Review sales tax payableLiability ties to filings; confirm nexus obligations are current.
3. Run a P&L variance reviewCompare to last month and budget; explain any swing over 10%.
4. Scan the general ledgerLook for miscodings, duplicates, and round-number anomalies.
5. Second-person reviewA reviewer who didn't do the work signs off - the step most small teams skip.
6. Lock the period and issue reportsClose the period in your software and send the reporting pack. Need forward-looking numbers too? See forecasting & strategy.