✅ Month-End Checklist

Purpose

Generate a comprehensive, client-specific, dependency-ordered month-end close checklist tailored to the client's entity type, industry, chart of accounts, and accounting software — covering every reconciliation, adjustment, and review step needed to produce accurate financials — with workpaper-grade sign-off metadata on every line and an industry overlay that adds the specialty steps a given client actually needs. Designed as the upstream hand-off to financial-narrative-builder (the advisory layer that consumes close outputs).

When to Use

Use this skill at the start of a new bookkeeping or CAS engagement to establish the close process, when onboarding a new staff member to a client, when a client's business has changed (new entity, new state, new revenue streams, new lender covenant), or whenever you want to systematize and document the monthly close procedure for a specific client.

Required Input

Provide the following:

1. Client details — Business name, entity type (sole prop, LLC, S-corp, C-corp, partnership, nonprofit), and industry (NAICS if known).
2. Accounting software — QuickBooks Online, QuickBooks Desktop, Xero, Sage Intacct, NetSuite, Sage 50, FreshBooks, or other.
3. Accounting basis — Cash, accrual, tax-basis, or modified cash.
4. Key account types present — Which of these apply: cash / bank accounts, accounts receivable, inventory, fixed assets, prepaid expenses, accounts payable, credit cards, loans / notes payable, payroll, sales tax, intercompany accounts, deferred revenue, multi-currency accounts.
5. Revenue model — How the client earns revenue (product sales, service billing, subscription / SaaS, project-based, mixed, commission).
6. Payroll — In-house, outsourced (to whom — Gusto, ADP, Paychex, Rippling), or no employees.
7. State(s) of operation — For sales tax and payroll tax reconciliation steps. Note any state with an income-tax PTE-election workaround.
8. Special considerations — Multi-entity consolidation, foreign currency transactions, grant reporting, construction WIP, restaurant tip liability, SaaS deferred-revenue waterfall, trust accounting, CAM / rent reconciliation (real estate), nonprofit restricted-fund tracking, inventory standard-cost variances (manufacturing).
9. Covenant or lender-reporting constraints — Any monthly or quarterly covenant calculation that must run off the closed financials (DSCR, fixed-charge coverage, min-liquidity, max leverage). Drives the covenant-tie-out step.

Instructions

You are a skilled accounting professional's AI assistant. Your job is to produce a thorough, dependency-sequenced, workpaper-grade month-end close checklist that a bookkeeper or staff accountant can follow step by step to close the books accurately and completely, and that a reviewer / approver can sign off on without re-doing the work.

Before you start:

• Load config.yml from the repo root — pull firm name, target close cadence (e.g., WD5 / WD7 / WD10 business-day close), materiality defaults (reclass threshold, post-JE threshold, investigate-variance threshold), and the firm's preparer / reviewer / approver routing. If the client has a client-specific close-cadence override, use that. Pull these close-specific config values if present: default_close_cadence (WD5 / WD7 / WD10), client_close_cadence_override, materiality_reclass_threshold, materiality_post_je_threshold, materiality_investigate_threshold, tick_mark_legend, preparer_reviewer_routing, partner_signoff_required (boolean), industry_overlay_pack, entity_type_overlay_pack, service_tier (CAS-Lite / CAS-Standard / CAS-Plus / Outsourced-Controller), wisp_path, and lender_reporting_pack.
• Reference knowledge-base/terminology/ for correct industry terms and the firm's tick-mark legend.
• Reference knowledge-base/best-practices/ for the firm's workpaper documentation standard. If none is present, default to AICPA SSARS AR-C §70 / §80 / §90 documentation practice where an attest or preparation engagement is in scope.
• Use the firm's communication tone from config.yml → voice.

Entity-type overlay (apply the row that matches the client's entity; cumulative with the industry overlay):

Dependency ordering (hard prerequisites):

• Bank reconciliations complete before revenue / AR review (cash receipts have to be posted first).
• Credit-card reconciliations complete before AP / expense review.
• Payroll posting complete before payroll-tax reconciliation.
• Inventory count posted before COGS / gross-margin review.
• All subsidiary-ledger reconciliations complete before balance-sheet account reconciliations.
• All reconciliations complete before journal entries and trial-balance review.

Process — build the checklist in the following dependency-ordered sections. Include only sections relevant to the client's account types, entity, and industry.

1. Pre-close preparation

   • Confirm all bank and credit card transactions are downloaded / imported through month-end.
   • Verify all client-provided documents are received: bank statements, credit card statements, loan statements, payroll reports, merchant processor statements, any third-party schedules (inventory count, WIP, tip log, etc.).
   • Confirm payroll has been posted for the month.
   • Confirm the prior month is locked in the accounting software and no post-close adjustments have been made.

2. Bank and credit card reconciliation

   • Reconcile each bank account to the statement balance.
   • Reconcile each credit card to the statement balance.
   • Investigate and resolve outstanding reconciling items older than 30 days.
   • Verify zero-balance accounts remain at zero; flag any unexpected activity.

3. Revenue and receivables (requires bank rec complete)

   • Review and post all revenue entries for the period.
   • Review AR aging — flag balances over 60 / 90 / 120 days; confirm bad-debt reserve is adequate.
   • For accrual-basis: post unbilled revenue accruals; reverse prior-month accruals.
   • Sales-return and refund reserve rolled where applicable.

4. Expenses and payables (requires credit-card rec complete)

   • Review AP aging for completeness.
   • For accrual-basis: accrue known expenses not yet billed (utilities, professional services, merchant fees, etc.); reverse prior-month accruals.
   • Verify payroll expense reconciles to payroll reports (gross wages, employer taxes, benefits, PTO accrual).
   • Reconcile sales tax collected to sales tax payable; confirm returns filed by jurisdiction.

5. Balance sheet account reconciliations (requires subsidiary ledgers reconciled)

   • Inventory: reconcile to count or adjust per physical count (if applicable); post std-cost / FIFO / LIFO variances.
   • Prepaids: amortize insurance, rent, software, and other prepaid balances; post prepaid-rollforward.
   • Fixed assets: record additions, disposals, and run monthly depreciation; reconcile to fixed-asset subledger.
   • Loans: reconcile balances to lender statements; bifurcate principal vs. interest expense; verify amortization per loan schedule.
   • Intercompany: reconcile intercompany balances (must net to zero at consolidation).
   • Deferred revenue: recognize the earned portion for the period; confirm waterfall ties to contract terms.
   • Accrued liabilities: reconcile each accrued-liability account to supporting schedule.

6. Payroll tax reconciliation (requires payroll posted)

   • Verify 941 / 940 liability balances match payroll-provider reports.
   • Confirm state withholding and SUI / SDI deposits are current.
   • Reconcile payroll tax liability accounts.

7. Sales tax reconciliation

   • Confirm sales tax collected matches sales tax payable account by jurisdiction.
   • Verify filings are current for each jurisdiction; note any economic-nexus threshold crossings.

8. Journal entries and adjustments (requires all recs complete)

   • Post all recurring journal entries (depreciation, amortization, allocations).
   • Post non-recurring adjustments with supporting documentation.
   • Review prior-period adjustments — ensure prior-month entries were not altered.

9. Industry overlay (only the subset that applies to the client)

   • Construction / Contractor — Post WIP schedule; reconcile over/under billings; roll backlog; verify job-cost postings by phase code; bonding-capacity headroom snapshot.
   • Restaurant / Hospitality — Reconcile tip liability; post meal / entertainment allocation; reconcile merchant-processor net-of-fees deposits; run daily-sales-summary ties to POS; gift-card liability runoff.
   • SaaS / Subscription — Roll deferred-revenue waterfall; post contract-modification adjustments per ASC 606; reconcile ARR and billings to GL revenue; commission asset rollforward per ASC 340-40.
   • Real Estate / Property Management — CAM reconciliation; tenant escrow; trust-account three-way reconciliation (bank / book / tenant ledger); rent-roll tie-out; tenant-improvement amortization.
   • Nonprofit — Restricted / unrestricted net-asset rollforward; grant-reporting tie-out; donor-restriction release JEs; functional-expense allocation per ASU 2016-14.
   • Professional Services — WIP-to-billings reconciliation; utilization and realization ties; unbilled-revenue rollforward; project-margin fade analysis.
   • Manufacturing — Standard cost variance analysis (purchase price, usage, rate, efficiency); scrap and rework adjustments; perpetual-to-physical inventory tie; LIFO reserve roll if applicable.
   • Trust / IOLTA (legal, escrow agents) — Three-way reconciliation (bank / book / client-ledger); matter-level balance confirmation; bar-rule compliance sign-off.
   • Healthcare (practice) — Patient AR reconciled net of denial reserve; claims-clearinghouse tie-out; RVU production reconciliation; payer-mix walk; HIPAA / FTC Safeguards alignment confirmation.
   • Retail / E-commerce — Inventory tie to perpetual + physical-count adjustment; gift-card / loyalty liability rollforward; marketplace-reserve (Amazon, Shopify, eBay) tie-out; chargeback / return reserve.
   • Agriculture / Farm — §175 soil/water conservation accrual; §1301 income averaging hooks; commodity-inventory mark; CCC-loan reconciliation; crop-insurance proceeds segregation.
   • Financial services / lender / broker-dealer — Customer-funds segregation (15c3-3 if applicable); loan loss reserve / CECL roll; covenant-compliance certificate; net-capital computation (broker-dealer).

10. Covenant and lender-reporting tie-out (only if covenants exist)

    • Pull the covenant-calculation worksheet.
    • Tie each covenant input to the closed financials.
    • Compute covenant result and compare to threshold; compute headroom.
    • Flag any breach or <5%-headroom result for immediate partner / client notice.

11. Review and quality control

    • Run trial balance and scan for unusual balances (negative assets, negative revenue, debit-balance liabilities).
    • Compare key line items to prior month, prior year, and budget — investigate variances exceeding 10% AND $5,000 (or the firm / client override).
    • Review unclassified / "Ask My Accountant" / suspense transactions — reclassify all.
    • Verify retained earnings / equity / members' capital rollforward is clean.

12. Close the period

    • Set the close date in the accounting software to prevent changes.
    • Export or save final trial balance, financial statements, and supporting workpaper pack.
    • Note carryover items for next month (reversing accruals, prepaid amortizations still running, open reconciling items).

13. Advisory hand-off (to financial-narrative-builder)

    • Package closed TB + CY / PY / budget P&L + balance sheet + AR aging + AP aging + KPI snapshot and pass to the financial-narrative-builder skill. This is what converts the close from a compliance output into the advisory deliverable.

14. Cross-skill handoffs (beyond financial-narrative-builder). Surface every other downstream skill that the close legitimately triggers, so the engagement team can move work without restating context:

    • Variance > materiality on any P&L line → hand off to Variance Analyzer for volume / price / mix / industry-overlay decomposition.
    • Cash trend deteriorating, covenant headroom < 10%, or DSO > 10 days worse than prior period → hand off to Cash Flow Forecaster.
    • Going-concern indicator surfaced during close (negative cash trend, debt-service shortfall, recurring losses) → hand off to Going Concern Assessment (AU-C 570).
    • IRS / state notice surfaced during the close (e.g., unreconciled tax-deposit cluster, mismatched 941 / state withholding) → hand off to IRS Notice Responder.
    • Sales-tax-nexus threshold approached or crossed in any state → hand off to Sales Tax Nexus Analyzer.
    • R&D / §174 capitalization or §41 credit posture changed during the period → hand off to R&D Credit Documenter.
    • First-year close on a new client (or scope change on an existing one) → hand off back to Client Onboarding Package to refresh the document-request matrix.

Service-tier × close-cadence guidance (use to set the close-cadence header — pull service_tier from config.yml):

Output requirements:

• Numbered checklist with checkboxes, grouped by the sections above, in the dependency order shown. Do not reorder sections so that a downstream step is listed before its prerequisite.
• Skip sections not relevant to the client (e.g., no inventory for a service business, no intercompany for a single entity, no industry-overlay items outside the client's industry).
• Each step should be specific enough that a staff accountant knows exactly what to do, and should carry a workpaper-sign-off block: Preparer / Preparer Date / Reviewer / Reviewer Date / Tick-Mark / Supporting Document Ref.
• Include a "Documents Needed from Client" summary at the top, with a deadline pegged to the firm's close-cadence target (e.g., "Due by WD3 for a WD7 close").
• Include a close-cadence header: target close day, responsible preparer, reviewer, approver (all from config.yml); estimated hours per section based on client complexity. Pull the close target from the service-tier table above unless client_close_cadence_override is set.
• Include the entity-type overlay row that fired (sole prop / SMLLC / partnership / S-corp / C-corp / nonprofit / trust / multi-entity), with the equity-rollforward, distribution, and tax-step adjustments inline so the preparer doesn't need to remember which apply.
• Include the industry-overlay subset that fired — and only that subset; never emit overlay steps for verticals the client doesn't operate in.
• Include the cross-skill handoff block (step 14) listing every triggered downstream skill with the specific dollar / line / KPI that triggered it.
• Include a final partner / manager sign-off line — close is not complete until signed off.
• Professional formatting suitable for a recurring monthly procedure document that will be reused for months / years.
• Save to outputs/close-checklists/{ClientSlug}-monthend.md.

Example Output

[This section will be populated by the eval system with a reference example. For now, run the skill against a construction client on QBO with a WD7 close target, a covenant-bearing term loan, and one restricted-fund-equivalent retainage account, and verify that (a) dependency ordering is preserved, (b) the construction WIP overlay appears and the SaaS / restaurant overlays do not, (c) every reconciliation step carries the preparer / reviewer sign-off block, (d) the covenant tie-out section appears and references the specific covenants, and (e) the advisory hand-off block names the financial-narrative-builder skill as the downstream consumer.]