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Free checklist and template
Month-End Close Checklist: The Step-by-Step Close Process (Free Template)
The month-end close turns a month of transactions into numbers you can report. This ScaleXP checklist sets out every step for finance teams on Xero or QuickBooks Online: what to do before the close, which revenue and cost journals to post, what to reconcile, who reviews it and when to lock the period.
Each step has an owner and is marked manual or automatable. Use it here, or download the free Excel template. If you would rather have the journal steps prepared for you, that is what our month-end close software does.
What is the month-end close process?
The month-end close process is the set of steps a finance team completes after each month ends to make the books accurate: recording every invoice and bill, posting revenue and cost adjustments, reconciling the balance sheet, reviewing the results and locking the period. The output is a set of management accounts you can rely on.
- Before the close: Set the cut-off, bring the month's data in and make sure nothing is missing. Day −3 to Day 0
- Revenue: Recognize income in the month it is earned, not the month it is billed. Day 1 to Day 2
- Costs: Put every cost in the month it relates to, whether or not the bill has arrived. Day 2 to Day 3
- Late adjustments and reconciliations: Prove the balance sheet and pick up anything that changed after the cut-off. Day 3 to Day 4
- Review and approve: A second pair of eyes before anything is reported, even in a one-person team. Day 4 to Day 5
- Report and lock: Share the numbers, then stop anyone posting into a month that has been reported. Day 5
The phases follow the order of the Month-End Close checklist in ScaleXP's Journals tab, so the template and the product work the same way. Running a subscription business? See the month-end close checklist for SaaS teams. Closing in QuickBooks? See the version for QuickBooks Online.
The month-end close checklist
Every step has an owner and a type. The owner is the Preparer, Reviewer or Approver; Reviewer and Approver are optional, because many finance teams are one person. The type is Manual or Automatable, and where a step can be automated the note says how it works in Xero or QuickBooks Online.
Before the close
Day −3 to Day 0Set the cut-off, bring the month's data in and make sure nothing is missing.
| Step | Owner | Type | Notes for Xero and QuickBooks Online |
|---|---|---|---|
| Set the cut-off date and share the close calendar | Preparer | Manual | Agree the last day for sales invoices, supplier bills and expense claims, and who owns each step. |
| Sync the month's invoices, bills and credit notes | Preparer | Automatable | The source data sits in Xero or QuickBooks Online. A connected close process pulls the period in, rather than exporting it to spreadsheets. |
| Confirm every sales invoice has been raised | Preparer | Automatable | Compare won deals or signed contracts with invoices raised. With a CRM connected, ScaleXP flags won deals that have no invoice. |
| Chase missing supplier bills and expense claims | Preparer | Manual | List the recurring suppliers whose bill has not arrived. Each one is a likely accrual. |
| Code uncategorized bank transactions | Preparer | Automatable | Bank rules in Xero and QuickBooks Online code repeat transactions. Review the ones they miss. |
Revenue
Day 1 to Day 2Recognize income in the month it is earned, not the month it is billed.
| Step | Owner | Type | Notes for Xero and QuickBooks Online |
|---|---|---|---|
| Review new customer invoices and usage revenue | Preparer | Manual | Check service periods and contract dates before anything is recognized. |
| Post the deferred revenue journal | Preparer | Automatable | Release income invoiced in advance over its service period. See how deferred revenue works. |
| Post the accrued revenue journal | Preparer | Automatable | Add income earned but not yet invoiced, and release it when the invoice is raised. See accrued income. |
| Update revenue schedules for new or changed contracts | Preparer | Automatable | Apply one recognition policy consistently, whether IFRS 15 or ASC 606. See revenue recognition. |
| Match credit notes and refunds to their schedules | Preparer | Automatable | A credit note should reduce the schedule it relates to, not sit on its own in the current month. |
Costs
Day 2 to Day 3Put every cost in the month it relates to, whether or not the bill has arrived.
| Step | Owner | Type | Notes for Xero and QuickBooks Online |
|---|---|---|---|
| Review new supplier bills and usage costs | Preparer | Manual | Check which bills cover future periods and which costs arrived late. |
| Post the prepayments journal | Preparer | Automatable | Spread bills that cover future periods across the months they relate to. See prepayments. |
| Post the cost accruals journal | Preparer | Automatable | Recognize costs incurred before the bill arrives, and release the accrual when it lands. See accruals. |
| Accrue usage-based costs where relevant | Preparer | Manual | Hosting, payment fees and other metered costs are often billed after the month ends. |
| Post payroll and depreciation journals | Preparer | Manual | Agree payroll to the payroll report and run depreciation from the fixed-asset register. |
Late adjustments and reconciliations
Day 3 to Day 4Prove the balance sheet and pick up anything that changed after the cut-off.
| Step | Owner | Type | Notes for Xero and QuickBooks Online |
|---|---|---|---|
| Reconcile every bank and card account | Preparer | Automatable | Bank feeds and rules do most of the matching. The balance must agree to the statement. |
| Reconcile receivables and payables to the aged reports | Preparer | Manual | The aged receivables and payables totals should equal the balance-sheet control accounts. |
| Reconcile the balance-sheet control accounts | Preparer | Manual | Sales tax or VAT, payroll liabilities, deferred revenue, accruals and prepayments should each tie to a schedule. |
| Post intercompany and FX adjustments where relevant | Preparer | Manual | Match intercompany balances and revalue foreign-currency balances at the month-end rate. |
| Pick up late invoices, changed bills and credit notes | Preparer | Automatable | Resync the period and let the affected schedules update, rather than re-keying journals by hand. |
Review and approve
Day 4 to Day 5A second pair of eyes before anything is reported, even in a one-person team.
| Step | Owner | Type | Notes for Xero and QuickBooks Online |
|---|---|---|---|
| Review the trial balance | Reviewer (optional) | Manual | Look for balances with the wrong sign, suspense items and unexpected movements. |
| Review variances against last month and budget | Reviewer (optional) | Manual | Explain every movement above your materiality threshold before the numbers are reported. |
| Reviewer sign-off | Reviewer (optional) | Manual | Record who reviewed each step and when. See what an audit trail for the close should hold. |
| Approver sign-off | Approver (optional) | Manual | In a one-person team, record your own sign-off and the date so the month has an owner. |
Report and lock
Day 5Share the numbers, then stop anyone posting into a month that has been reported.
| Step | Owner | Type | Notes for Xero and QuickBooks Online |
|---|---|---|---|
| Produce the management accounts | Preparer | Automatable | Build the pack once and refresh it from the ledger each month. See the management accounts pack. |
| Prepare the board pack | Preparer | Manual | Add commentary on the variances you explained at review. See the board pack template. |
| Lock the period | Approver (optional) | Manual | Set a lock date in Xero, or close the books in QuickBooks Online, so no one posts into a closed month. |
A 5-day month-end close, day by day
Many small finance teams aim to close in about five working days. The order matters more than the count: revenue and costs before reconciliations, reconciliations before review. For how teams bring it down further, see how to cut the month-end close from 5 days to 1.
| Day | Focus | What gets done |
|---|---|---|
| Day 1 | Before the close | Sync the period, confirm every sales invoice is raised, chase missing bills, code bank transactions. |
| Day 2 | Revenue | Review new invoices, post the deferred and accrued revenue journals, match credit notes. |
| Day 3 | Costs | Post prepayments and cost accruals, accrue usage costs, post payroll and depreciation. |
| Day 4 | Reconciliations | Reconcile bank, receivables, payables and control accounts; pick up late changes. |
| Day 5 | Review, report, lock | Review and sign off, produce the management accounts and board pack, lock the period. |
See the close run in ScaleXP
A 30-minute demo uses example data to show the checklist, the revenue and cost journals and the review steps in the Journals tab. You can also compare plans and pricing.
Which month-end steps can be automated in Xero or QuickBooks Online?
Split the checklist in two. Steps that follow a rule every month can be prepared automatically from your ledger. Steps that need a decision stay with your team.
Can be automated
- Syncing the month's invoices, bills and credit notes
- Flagging won deals that have no invoice, when a CRM is connected
- Deferred revenue and accrued revenue schedules and journals
- Prepayment and cost accrual schedules and journals
- Updating schedules for late invoices, changed bills and credit notes
- Bank matching, through bank feeds and bank rules
Stays manual
- Agreeing the cut-off and chasing missing bills
- Judging service periods on unusual contracts
- Explaining variances against last month and budget
- Reviewer and approver sign-off
- Board commentary and locking the period
If you want to automate the journal steps in Xero or QuickBooks Online, ScaleXP prepares the deferred revenue, accrued revenue, prepayment and cost accrual schedules and draft journals, and your team reviews and approves each journal before it posts. On Xero, see also how to close the month in Xero with AI.
7 common month-end close mistakes
Each mistake below maps to a step in the checklist, so the checklist is also the fix.
1. Closing before the cut-off is agreed
Late bills and invoices then land in the wrong month.
Checklist step: Before the close: set the cut-off date
2. Missing invoices for work already delivered
Revenue is understated and cash collection slips a month.
Checklist step: Before the close: confirm every sales invoice
3. Booking an annual invoice as revenue in one month
One month looks too strong and the next eleven too weak.
Checklist step: Revenue: the deferred revenue journal
4. Forgetting costs whose bill has not arrived
Margins look better than they are until the bill lands.
Checklist step: Costs: the cost accruals journal
5. Reconciling the bank but not the balance sheet
Errors hide in control accounts until year-end.
Checklist step: Reconciliations: the control accounts
6. Posting into a month that has already been reported
The numbers change after the board has seen them.
Checklist step: Report and lock: lock the period
7. Keeping no record of who reviewed what
Nobody can show an auditor how a number was checked.
Checklist step: Review and approve: sign-offs
Month-end close vs year-end close
The year-end close is the month-end close plus statutory work. If every month has been closed cleanly, the year-end is mostly the extra steps below, not a rebuild of the year.
| Compare | Month-end close | Year-end close |
|---|---|---|
| How often | Every month | Once a year |
| Main purpose | Accurate management accounts for decisions | Statutory accounts, tax and audit |
| Typical extra steps | None beyond the checklist | Year-end adjustments, a full fixed-asset review, tax provisions, audit requests |
| Who reads the output | Leadership and the board | Auditors, tax authorities, investors and lenders |
Download the month-end close checklist template
The same checklist as an Excel workbook, ready to reuse every month. It also opens in Google Sheets.
- Every step in this guide, grouped into the six phases
- Owner, type and a Xero or QuickBooks Online note for each step
- Columns for the due day, who it is assigned to, status and comments
- A progress summary that counts completed steps by phase
Get the free template
Enter your details and the Excel file downloads straight away.
Excel workbook (.xlsx), 3 tabs.
Month-end close checklist FAQs
What is the month-end close process?
The month-end close process is the set of steps a finance team completes after each month ends to make the books accurate. It covers recording every invoice and bill, posting revenue and cost adjustments, reconciling the balance sheet, reviewing the results and locking the period.
What should a month-end close checklist include?
At minimum: a cut-off date, a check that every sales invoice and supplier bill is in, the revenue journals (deferred and accrued revenue), the cost journals (prepayments and accruals), bank and balance-sheet reconciliations, a review and sign-off, the management accounts and a period lock. Give each step an owner and a due day.
How long should the month-end close take?
Many small finance teams aim for about five working days, and the order of the steps matters more than the count. Teams that connect their ledger and prepare the recurring journals ahead of time close faster. See how teams cut the close from 5 days to 1.
What's the difference between month-end and year-end close?
The month-end close produces management accounts for decisions. The year-end close repeats those steps and adds statutory work: year-end adjustments, a full fixed-asset review, tax provisions and requests from auditors. A clean monthly close makes the year-end much shorter.
Who owns the month-end close in a small finance team?
Often one person prepares, reviews and approves everything. That works if each step still has a named owner and a recorded sign-off. As the team grows, split the roles: a preparer posts the journals, a reviewer checks them and an approver signs off the month.
Which month-end close steps can be automated in Xero or QuickBooks Online?
The repeatable steps: syncing the period, flagging won deals with no invoice, and preparing the deferred revenue, accrued revenue, prepayment and cost accrual schedules and journals, plus bank matching through bank rules. Judgment steps such as variance review and sign-off stay with your team. See how ScaleXP automates the close.