A fast, clean close isn’t about working harder the last three days of the month. It’s about having a repeatable sequence that everyone on the team follows, with supporting schedules that produce audit-ready output without heroics.
This checklist covers the full close cycle — from cutoff through final signoff — with specific attention to the technical areas (lease accounting, deferred commissions, deferred revenue) where growing companies tend to slow down or make errors.
Free Excel workbook: the full checklist below is also available as a free 5-tab Month-End Close Workbook with 42 pre-populated tasks, 18 subledger reconciliations, a JE tracker, and a printable sign-off page. Pay What You Want on Gumroad, $0 minimum. Read on for the long-form guide, or download the workbook →.
Before You Start: Prerequisites for a Clean Close
These aren’t close tasks — they’re ongoing hygiene that determines whether your close is a 3-day process or a 10-day scramble:
- Chart of accounts is clean — no catch-all accounts with mystery balances
- Subledgers are maintained — AP, AR, fixed assets, and leases updated throughout the month
- Bank accounts are reconciled weekly, not at month-end
- Expense reports submitted with a hard cutoff 2 business days before month-end
- Prepaid and accrual schedules are maintained in a workbook, not in someone’s head
If any of these are missing, fix them before optimizing the close sequence. You can’t schedule your way out of bad underlying data.
Day 1–2: Cutoff and Data Collection
Revenue cutoff
- Confirm all revenue recognized in the period has a corresponding invoice or contract milestone
- Identify any deals signed in the last 3 days — confirm whether they meet recognition criteria for this period
- Pull deferred revenue balance from the subledger and reconcile to GL
Accounts payable cutoff
- Ensure all vendor invoices received through the last business day of the month are posted
- Accrue for invoices not yet received but for which services were rendered (common: legal, consulting, cloud infrastructure)
- Confirm purchase order cutoff with operations or procurement
Payroll
- Accrue for any wages earned but not paid as of month-end (partial pay periods)
- Confirm payroll taxes and benefits accruals are posted
- Update commission expense accruals — see commissions section below
Bank and credit card cutoff
- Pull final bank statements for the last day of the month
- Post any unrecorded transactions (bank fees, interest income/expense, wire transfers)
- Confirm all credit card charges are imported and coded
Day 2–3: Subledger Reconciliations
Subledger to GL reconciliations are non-negotiable. If these don’t tie, you’re closing on wrong numbers.
Accounts receivable
- AR subledger balance ties to GL
- Aged AR report reviewed — flag anything >90 days for reserve analysis
- Bad debt reserve updated (if using allowance method)
- Credit memos and unapplied cash resolved
Accounts payable
- AP subledger balance ties to GL
- Vendor statements reconciled for key vendors
- Outstanding checks reviewed for stale items (>90 days)
Fixed assets / depreciation
- Additions and disposals posted for the period
- Depreciation run for all assets
- Accumulated depreciation ties to fixed asset subledger
- Confirm any asset retirements or transfers are reflected
Day 3–4: Technical Accounting Schedules
This is where growing companies most often lose time. These schedules need to be maintained systematically — not rebuilt from scratch each month.
Deferred commissions (ASC 606 / ASC 340-40)
If your company capitalizes sales commissions, you need a working schedule that:
- Tracks each commission payment with its amortization method and term
- Calculates the current-period amortization expense
- Generates the journal entries (capitalization + amortization)
- Produces a rollforward that ties to the deferred commission asset on the balance sheet
Month-end checklist:
- New commission payments entered into the schedule
- Period amortization calculated and journal entry posted
- Deferred commission asset balance per schedule ties to GL
- Any deal amendments or reversals reflected
If this is being done in a manual spreadsheet and taking more than 2 hours, it’s time for a structured workbook. The ASC 606 Commission Accrual Workbook handles this for up to 50 deals with automated journal entries and a reconciliation tab.
Lease accounting (ASC 842)
For each active lease:
- Monthly journal entry generated (operating: single lease expense; finance: depreciation + interest)
- Lease liability balance per amortization schedule ties to GL
- ROU asset balance per schedule ties to GL
- Any new leases commenced this period — initial recognition entry posted
- Any leases modified or terminated — remeasurement entry posted
For multi-lease portfolios, a structured workbook is essential. The ASC 842 Lease Accounting Workbook handles 20 leases with period-level journal entry aggregation and balance sheet reconciliation.
Prepaid expenses
- Prepaid schedule updated with new payments
- Monthly amortization entries posted for each prepaid
- Prepaid balance per schedule ties to GL
Accrued liabilities
- Recurring accruals posted (insurance, rent, professional fees)
- One-time accruals reviewed and posted with appropriate documentation
- Prior-period accruals reversed if appropriate
- Accrued liabilities schedule ties to GL
Deferred revenue (if applicable)
- Deferred revenue schedule updated for new billings
- Revenue recognized this period calculated per schedule
- Deferred revenue balance per schedule ties to GL
Day 4–5: Income Statement Review
Before you close, read the P&L. Not as a list of numbers — as a story.
Revenue
- Revenue by line item vs. prior month — explain any variance >5%
- Revenue vs. budget — document significant variances
Cost of goods sold / cost of revenue
- Gross margin % vs. prior period — explain movement
- Any unusual items or one-time charges flagged
Operating expenses
- Each expense line vs. prior month and budget
- Headcount-driven costs reviewed against headcount changes
- Confirm no items were miscoded to the wrong account
Below-the-line items
- Interest expense ties to debt schedule
- Depreciation ties to fixed asset schedule
- Lease expense ties to lease schedule
- Commission amortization ties to deferred commission schedule
Day 5: Balance Sheet Review
Run a balance sheet as of the last day of the month and review every line:
Assets
- Cash ties to bank reconciliation
- AR ties to subledger
- Prepaid ties to prepaid schedule
- Deferred commissions tie to commission schedule
- ROU assets tie to lease schedule
- Fixed assets (net) tie to fixed asset subledger
Liabilities
- AP ties to subledger
- Accrued liabilities tie to accrual schedule
- Deferred revenue ties to deferred revenue schedule
- Lease liabilities tie to lease schedule
- Debt ties to debt schedule
Equity
- Retained earnings roll properly (prior month RE + current period net income)
- Any equity transactions (stock comp, issuances) reflected correctly
Day 5–6: Flux Analysis
A flux analysis is a line-by-line explanation of what changed and why. It catches errors before they become audit findings and builds institutional knowledge about your business.
| Account | Current Month | Prior Month | $ Change | % Change | Explanation |
|---|---|---|---|---|---|
| Commission expense | $42,300 | $38,100 | $4,200 | +11% | New sales rep commission + $3,800 deal |
| Lease expense | $15,000 | $15,000 | $0 | 0% | No lease changes |
| Deferred commissions | $187,400 | $180,000 | +$7,400 | +4% | New capitalization ($10,200) - amortization ($2,800) |
Any line that can’t be explained by a known business event warrants investigation before the books are closed.
Day 6–7: Final Review and Signoff
- Trial balance reviewed by controller — no unusual balances
- Intercompany eliminations confirmed (if applicable)
- All journal entries have supporting documentation
- Management review package drafted (P&L, BS, cash flow, key metrics)
- Prior-period adjustments documented with materiality assessment
- Books locked in accounting system
Cutting Your Close Time
If your close is taking 10+ business days, the bottlenecks are almost always:
- Manual schedules that get rebuilt each month — deferred commissions, leases, prepaids. Structured workbooks cut this to minutes.
- Late expense reports — enforce a hard cutoff. Even one day earlier creates significant downstream time.
- Subledger discipline — AR and AP reconciliations should be a daily or weekly task, not a monthly scramble.
- No flux analysis template — analyzing variances without a standard template means starting from scratch. Build one and reuse it.
The goal is a 5-day close where Day 6 is review, not catch-up.
Templates That Support the Close
Five of the most time-consuming finance tasks — close orchestration, deferred commission accounting, lease accounting, fixed asset depreciation, and cash runway modeling — are handled by our workbooks:
Month-End Close Checklist + Tie-Out Workbook — Free A 5-tab Excel workbook that holds your entire close in one place: 42 pre-populated tasks, 18 subledger reconciliations with materiality flag, JE tracker, and printable sign-off. Pay What You Want, $0 minimum.
ASC 606 Commission Accrual Workbook — $79 Handles 50 deals with three amortization methods, automated journal entries, rollforward, and reconciliation.
ASC 842 Lease Accounting Workbook — $97 Handles 20 leases (operating + finance), 120-month amortization schedule, period journal entries, and balance sheet reconciliation. Try the free 3-lease version →
Fixed Asset Rollforward Workbook — $79 50 capitalized assets, four depreciation methods, JE generator with GL system presets, and a five-way reconciliation tab. Try the free 5-asset version →
Startup Runway Calculator — $49 12 to 48-month cash flow forecast with Base, Optimistic, and Pessimistic scenario modeling. Know exactly how many months of runway you have before every board meeting. Try the free 12-month version →
All five are pure Excel — no macros, no setup, no subscription. Download and use in the same close cycle.
Frequently Asked Questions
How long should a month-end close take? Many SaaS finance teams target five business days; teams with automated subledger reconciliations and technical schedules that roll forward without re-keying regularly close in three. The close calendar in the checklist is built around a five-day target.
What is a tie-out in month-end close? A tie-out is a reconciliation that proves a subledger or supporting schedule agrees to the general ledger balance — cash to the bank statement, AR to the aging, deferred commissions to the amortization schedule, lease liabilities to the ASC 842 schedule. Any variance above your materiality threshold is investigated before sign-off.
What should a month-end close checklist include? Cutoff tasks (AP, AR, payroll, bank), subledger-to-GL reconciliations, technical accounting schedules (revenue, deferred commissions, leases, fixed assets), accruals and prepaids, equity and tax entries, financial statement review, and a sign-off with owner and reviewer for each task.
Who signs off on the month-end close? Each task has a preparer and a reviewer; the controller or CFO signs off on the close package once reconciliations tie within materiality, journal entries are reviewed, and the financial statements are distributed. A printable sign-off page makes the evidence trail audit-ready.
KDesk Accounting builds audit-ready Excel tools for finance teams. Browse all templates →