What is month end closing process?

What is the Month-End Close Process? At the end of every month, a business needs to review its accounts to ensure it has properly recorded and reconciled all of the transactions that have taken place during that specific month. This helps to ensure all accounting data is organized, accurate, and complete.

How do you close out a month?

Month-end closing process

1. Record incoming cash. When closing your books monthly, you need to record the funds you received during the month.
2. Update accounts payable.
3. Reconcile accounts.
4. Review petty cash.
5. Look at fixed assets.
6. Count inventory.
7. Organize and review financial statements.
8. Check revenue and expense accounts.

How do you balance the end of the month?

How to Reconcile Accounts for Month End?

1. Record Incoming Cash. Record the funds you’ve received during the month in terms of loans, revenue, invoice payments, etc.
2. Review Accounts Payable.
3. Reconcile Accounts.
4. Reconcile Petty Cash.
5. Review Fixed Assets and Inventory.
6. Assemble Financial Statements.
7. Final Review.

How do you write a month end report?

Complete Your Month-End Reporting in 4 Steps

1. Step 1: Align Daily/Weekly Reports With Month-End Reports.
2. Step 2: Prepare All Month.
3. Step 3: Allocate Time for and Anticipate Errors.
4. Step 4: Calculate and Analyze.

What tasks would you need to complete before closing the books?

Checklist for Closing Your Accounting Books for Year End

• Reconcile Your Bank Accounts.
• Review Payroll Expenses and Profit & Loss Statements.
• Evaluate Accounts Receivable and Invoices.
• Analyze Fixed Assets and Depreciation Expenses.
• Run Taxable Sales Report.
• Fill Out W-2s and 1099s.
• Ensure Inventory Balance Is Properly Stated.

How can month End Closing be improved?

Five ways to make improvements to your month end close process:

1. Automate. Automation can benefit the month end close process in many ways including bringing more operational efficiency, transparency, and speed.
2. Move away from disparate systems.
3. Back up your data.
4. Access real time data.
5. Be more organized.

What accounts should be reconciled monthly?

Accountants must reconcile credit card transactions, accounts payable, accounts receivable, payroll, fixed assets, subscriptions, deferred accounts, and other areas against the general ledger, or balance sheet.

What does a monthly report include?

Monthly reports should generally be brief, but also comprehensive, listing major activities and actions taken, as well as goals for the upcoming month.