1 of 48

Accounting Period-Close Practices

Day 1, Session 3

Jordan Jolly

Georgian @ 12:45pm

2 of 48

The Goal (Monthly)

​

​

Your account balances on the Balance Sheet…

​

  • A/R
  • Cash / Credit Card
  • A/P
  • Accrued Liabilities
  • Inventory

3 of 48

The Goal (Monthly)

​

​

Your account balances on the Balance Sheet…

​

  • A/R
  • Cash / Credit Card
  • A/P
  • Accrued Liabilities
  • Inventory

Should match the transaction details supporting them.

​

Open Customer Receivables

Bank/Account Statements

Open Vendor Payables

Receipts Not Invoiced

Warehouse/Bin Details

4 of 48

The Goal (Monthly)

​

​

Also…

​

After you’ve reconciled those numbers, you should:

​

Lock the accounting period preventing anyone from messing up your reconciled numbers.

5 of 48

The Goal (Yearly)

​

​

Post retained earnings at year end from P&L to Balance Sheet.

6 of 48

Let’s get started.

7 of 48

Monthly (A/R)

​

​

Your account balances on the Balance Sheet…

​

  • A/R

​

Should match the transaction details supporting them.

​

Open Customer Receivables

​

8 of 48

Monthly (A/R)

​

​

9 of 48

Monthly

​

​

Monthly (A/R)

​

​

10 of 48

Monthly

​

​

Monthly (A/R)

​

​

11 of 48

Monthly

​

​

Monthly (A/R)

​

​

But wait…

12 of 48

Monthly

​

​

Monthly (A/R)

​

​

That’s closer…

13 of 48

Monthly

​

​

Monthly (A/R)

​

​

Use Accounting >> Audit

14 of 48

Monthly

​

​

Monthly (A/R)

​

​

Make adjustments:

​

  • Update dates on invoices, payments, prepayments, etc.

​

  • Adjust filters on A/R Detail reports (include/exclude prepayments and/or overpayments)

​

  • Get to a point where you really trust the A/R Detail as authoritative

​

  • Make G/L posting to Accounts Receivable to make your receivables account balance (as of _x_ date) match A/R detail.

​

15 of 48

Monthly

​

​

Your account balances on the Balance Sheet…

​

​

  • Cash / Credit Card

​

Should match the transaction details supporting them.

​

​

Bank/Account Statements

​

​

16 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

17 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

18 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

19 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

20 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

21 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

22 of 48

Monthly

​

​

Monthly (Bank Statement)

​

​

23 of 48

Monthly (A/P)

​

​

Your account balances on the Balance Sheet…

​

​

​

  • A/P

​

Should match the transaction details supporting them.

​

​

​

Open Vendor Payables

​

24 of 48

Monthly (A/P)

​

​

25 of 48

Monthly (A/P)

​

​

26 of 48

Monthly (A/P)

​

​

27 of 48

Monthly

​

​

Monthly (A/P)

​

​

Make adjustments:

​

  • Update dates on vouchers, payments, debit memos, etc.

​

  • Get to a point where you really trust the A/P Detail as authoritative

​

  • Make G/L posting to Accounts Payables to make your payables account balance (as of _x_ date) match A/P detail.

​

28 of 48

The Goal (Monthly)

​

​

Your account balances on the Balance Sheet…

​

​

​

​

  • Accrued Liabilities

​

Should match the transaction details supporting them.

​

​

​

​

Receipts Not Invoiced

​

29 of 48

Monthly (Accrued Purchases)

​

​

30 of 48

Monthly (Accrued Purchases)

​

​

31 of 48

Monthly (Accrued Purchases)

​

​

32 of 48

Monthly

​

​

Monthly (Accrued Purchases)

​

​

33 of 48

Monthly

​

​

Monthly (Accrued Purchases)

​

​

Make adjustments:

​

  • Update dates on receipts, vouchers.

​

  • Get to a point where you really trust the PO Receipts “Not Invoiced” as authoritative

​

  • Make G/L posting to Balance Sheet >> Accrued Purchases to make your Accrual account balance (as of _x_ date) match PO Receipts (Not Invoiced).

​

34 of 48

The Goal (Monthly)

​

​

Your account balances on the Balance Sheet…

​

​

​

​

​

  • Inventory

Should match the transaction details supporting them.

​

​

​

​

​

Warehouse/Bin Details

35 of 48

Monthly

​

​

Monthly (Inventory)

​

​

36 of 48

Monthly

​

​

Monthly (Inventory)

​

​

37 of 48

Monthly

​

​

Monthly (Inventory)

​

​

38 of 48

Monthly

​

​

Monthly (Inventory)

​

​

39 of 48

Monthly

​

​

Monthly (Inventory)

​

​

40 of 48

Monthly

​

​

Monthly (Inventory)

​

​

41 of 48

The Goal (Monthly)

​

​

Also…

​

After you’ve reconciled those numbers, you should:

​

Lock the accounting period preventing anyone from messing up your reconciled numbers.

42 of 48

Locking The Accounting Period (Monthly)

​

​

43 of 48

The Goal (Yearly)

​

​

Post retained earnings at year end from P&L to Balance Sheet.

44 of 48

Retained Earnings (Yearly)

​

​

Post retained earnings at year end from P&L to Balance Sheet.

45 of 48

Retained Earnings (Yearly)

​

​

46 of 48

Retained Earnings (Yearly)

​

​

47 of 48

Your Questions?

Account Reconcile (Bank & Credit Card)

​

​

48 of 48

Accounting Period Close Best Practices

​

​