How to close the month

Why it matters

A fast, repeatable close gives you numbers you can use while they are still fresh. A slow close means decisions are made on old data.

A checklist also catches the same errors each month, such as bills in the wrong period and bank items not cleared.

The steps

1. Set the cut-off. Agree the last day for bills, expense claims and timesheets, such as the third working day.
2. Enter all transactions. Enter every supplier bill, customer invoice and payment dated in the month. Clear the approval queue.
3. Reconcile the bank and cards. Match every bank and card line. Clear or explain old items.
4. Check the sub-ledgers. Match the aged payables and aged receivables totals to the balance sheet.
5. Post accruals and prepayments. Record costs incurred but not billed. Spread prepaid costs across the months they cover.
6. Post depreciation and payroll journals. Book depreciation. Check wages, PAYG withholding and super are recorded.
7. Check GST. Compare the GST accounts with the totals you expect on the BAS.
8. Review the reports. Read the profit and loss and balance sheet. Compare with budget and last month. Investigate big moves.
9. Lock the period. Set the lock date so no one changes closed months. Save the reports.

The Pulsify way

1. Forward invoices to your Pulsify address as they arrive so late bills are read and queued.
2. Use the approval queue to clear what is waiting. Bulk approve the clean ones.
3. Forward supplier statements to compare them with your bills.

Worked example

Example Distribution Pty Ltd closes October. The team works to this schedule.

Working day	Task	Owner
Day 1	Cut-off, enter bills and invoices	AP officer
Day 2	Bank and card reconciliation	Bookkeeper
Day 3	Accruals, prepayments, depreciation	Bookkeeper
Day 4	GST and sub-ledger checks	Finance manager
Day 5	Review reports and lock the month	Finance manager

The books close on working day 5. The finance manager reads the reports that day and the owner gets them on day 6.

Common mistakes

• Closing without clearing the approval queue.
• Forgetting to reverse an accrual.
• Locking the month before the review.
• Having no owner for each task.

Next step

Use the Month-end close checklist generator first. Then see how to close the month in AP.