Is Your Month-End Checklist Failing You?

Pete Archer

Founder / CEO

Every financial control team relies on a month-end close checklist, it’s a crucial tool to ensure all tasks are completed and nothing gets overlooked. However, not all month-end close tools are created equal. Some exist merely to claim the presence of an internal-control, but in reality, they are prepared as an afterthought, acting as a hindrance rather than a help to the team. On the other hand, some can genuinely assist a financial control team in reducing stress around the month-end close process by adding value and insights.

Here at Easy Month End, we understand the nuances of the month-end close process and what separates effective tools from counterproductive ones. Outlined below are key aspects that make a month-end close tool/checklist valuable for financial control teams, alongside red flags indicating that your current checklist might be creating work rather than aiding the team.

Location, Location, Location

Where your checklist resides speaks volumes about its efficiency. If it's still printed out and physically signed off, then it's time for your team to upgrade. Paper checklists lack the capability to capture the detail you need, provide time stamps, exhibit flexibility, and serve as weak audit evidence. They are ill-suited for remote work and often end up sitting unused until the last minute, only to be hastily signed off for appearance's sake. The same holds true for any ad-hoc spreadsheet being used as a checklist, they often cannot be accessed by all team members and lack controls around editing and auditable proof of timely completion and review.

Time Sponge or Saver
A well-designed checklist should not add any time to your busy schedule; it should actually save your team time. From rolling the checklist forward from the previous month to the current one to managing your month-end timetable, the process should take no more than 10 minutes each month. If it takes longer, it's a clear sign that your checklist is more of a hindrance than a help. Switching to an automated solution designed for accountants can make the process seamless and efficient without creating yet another task for the team.

Seamless Signoffs
If signing off a task takes more time than the task itself, it's a clear indication that your month-end aide is actually a hindrance. Your checklist should be easily accessible, with sign-offs requiring minimal steps and no unnecessary chasing (automated reminders are the gold standard). Any friction in the sign-off process distracts your team from their core accounting work. Sign-offs are key audit evidence, and a seamless signoff allows for easy collection of audit evidence without adding extra time to your workload.

Gaining Insights should be Free and Easy
While not advocating for extravagant AI integration and the associated costs, having a checklist that provides insights is essential. After month-end, your checklist should offer visibility into when tasks were genuinely completed, who had to complete tasks not assigned to them, allowing you to give your team feedback and continually optimize the next month-end close. Even basic knowledge, like understanding task completion times, can be invaluable for efficiency.

Adaptability is Key
How easily can you modify your month-end close checklist? If the answer isn't an immediate "super easy," it's time to reconsider your approach. Nothing should be set in stone or difficult to change on the fly. Your team needs flexibility to adapt to any changes your company introduces. Tasks should be able to be reallocated, added, or removed seamlessly, all while preserving the audit history of previous periods. The easiest time to make a change to a process or due date is during the actual month-end close process while you are doing the task. If you have to spend time or seek approval or help to change the month-end checklist, then it is not fit for purpose.

Reflection of Reality, Not the Dream
The structure of your month-end close checklist is more important than you think. If task due dates are based on calendar days instead of workdays, it's a sign that your checklist may not be fit for purpose. Your checklist structure should align with your team's workflow, displaying due dates irrespective of month-end or weekends. Subcategories should be incorporated to track progress across different areas, and an efficient checklist should make it easy to identify tasks due today and tomorrow, or even yesterday but not yet completed.

While your month-end close checklist may not be at the forefront of your team's mind when it comes to efficiency, it is actually more influential than you may think. When executed correctly, it is a dynamic tool that enhances efficiency, saves time, and adapts to the evolving needs of your financial control team. By evaluating and optimizing your checklist based on the outlined criteria, you can transform it from a mere box-ticking exercise into a valuable asset in your financial management arsenal.

If any of the above items have left you questioning your team's current month-end close checklist, then reach out to us, and we can help you.

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