Financial statements are one of the most important strategic tools for any business. They assist companies in measuring progress toward key objectives and are crucial for producing an accurate cash flow forecast to make the most informed business decisions. The accountants have to comply with the regulatory deadlines to complete the closing process and issue financial statements. One of the most challenging aspects https://www.world-today-news.com/accountants-tips-for-effective-cash-flow-management-in-the-construction-industry/ faced by a financial accountant is to close the month-end and year-end accounts and present the financial statements and get them audited as fast as possible. The resulting financial statements are used by management, shareholders, lenders and regulators for their decision making. Produce month-end reports – Make sure to include a trial balance, income and expenditure account, a cash flow and a balance sheet.

The faster you close, the more time your team has to support your organisation. Where the reports identify incomplete transactions it is important to manage these transactions real estate bookkeeping appropriately and where necessary generate correcting journals. You should maintain a full audit trail and supporting documentation for such journals.

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You can close your accounting periods whenever you want to prevent transactions being posted to that period. Implementing a tailored, well-defined chart of accounts is also important. This will also help achieve consistent and accurate https://time.news/how-can-retail-accounting-streamline-your-inventory-management/ coding of transactions (general ledger coding, vat coding, tracking/departmental coding). Automate your finance processes with workflows and exception management automation to centralize and standardize the month-end close processes.

Once you create a month-end close process checklist in Excel, you can use our financial close management software to automate tasks to save time, reduce stress and maintain accuracy. After the month-end closing process is complete, it is important to review and analyze the financial statements to get an overall view of the company’s financials and to identify any trends or issues. Analyzing financial statements helps management make informed decisions about the company’s financial performance and identify areas for improvement. Temporary accounts, such as revenue and expense accounts, are closed and their balances are transferred to permanent accounts, such as retained earnings.

Close The Period

Normally, the financial consolidation and close takes place at the end of an accounting period. This could be the end of the month, quarter or calendar or fiscal year. However, one of the benefits of automating this process is that finance teams can produce consolidated accounts quickly and easily at any time. The month end close process is sometimes lengthy, with finance teams devoting enormous time and energy to what should be a streamlined operation. APQC’s General Accounting Open Standards Benchmarking survey found that 25% said they need 10 or more calendar days to perform the monthly end close process.