What month-end close means for a small business
Closing the month means making sure everything that happened in the month is in your accounting system and has been checked. Once it is, your profit and loss, balance sheet and cash position can be trusted for that month.
Most of the work is not accounting. It is operations: getting invoices out, approvals done, receipts collected and information to your bookkeeper on time. That part is what we set up and run.
In the last week of the month
- Send every invoice for work delivered this month. See bookings to billings for how to make sure nothing is missed.
- Approve and schedule bills that are due.
- Ask everyone with a company card to upload receipts and code their expenses.
- Confirm payroll ran and any commissions or bonuses are recorded.
In the first days of the new month
- Download bank and card statements, or confirm the bank feeds are current.
- Hand the month to your bookkeeper or accountant with a short note on anything unusual: a large one-off purchase, a new customer, a refund.
- Review the accounts receivable aging report and follow up on anything overdue.
- Review accounts payable so nothing is paid twice or forgotten.
Once the books are reconciled
- Review the profit and loss against last month and the same month last year.
- Look at cash on hand and what is coming in and going out over the next few weeks.
- Write down the two or three things leadership should know, and share them the same way every month.
- Note anything that slowed the close down, and fix the step that caused it.
How long it should take
Many small companies aim to have the month closed within the first one to two weeks of the following month. The biggest delays are usually missing receipts, late invoices and approvals waiting in someone's inbox, which is why the routine matters more than the software.
Who does what
Write down an owner for each line of the checklist. Your bookkeeper or accountant handles reconciliations and journal entries. Someone inside the company owns invoicing, approvals and receipts. Leadership owns the review.
We set up month-end routines, configure your accounting and billing tools to support them, and run them with your team each month. See finance operations.