In today’s business landscape, an efficient month-end close process is indispensable for ensuring financial accuracy and regulatory compliance, particularly within the realm of government contracting. To maintain compliance with company policies, government rules and accounting standards, teams must overcome cross-departmental task handoffs amidst long close cycles, which often poses a tremendous challenge for many businesses.  

These long close cycles can delay reporting, business performance reviews and customer billings, negatively impacting the company’s profitability and long-term success. To avoid wasting valuable time, companies should consider establishing, evaluating and enhancing internal controls within the confines of compliance regulations to expedite close cycles, bolster profitability and mitigate the risks associated with non-compliance. 

To that end, we recommend businesses implement the following strategies to streamline and optimize their month-end close without sacrificing the accuracy of their financials or causing burn out on their teams. 

Close Strategy #1: Month-End Checklist 

A month-end close checklist is essential for ensuring the books are closed accurately and efficiently in a structured and recurring process. It comprehensively outlines all tasks required in the close process, including deadlines, task interdependencies, ownership, handoff, cross-departmental alignment and status. 

The checklist should identify task interdependencies and be continuously updated for smooth coordination between dependent tasks to avoid task duplication. Clear deadlines ensure that all departments can coordinate between competing priorities and deadlines to complete tasks on time.  

The most important part of the checklist is ownership and task handoff tracking. These help establish the main contributor for each task and clearly define dependencies between tasks to reduce the risk of overlooked or mismanaged tasks. This ultimately leads to an established, smooth month-end closing process. 

Close Strategy #2: Frequent Touchpoints & Meetings 

The controller or accounting manager should maintain open lines of communication with process owners to identify potential roadblocks in the close process, allowing teams to address and minimize delays proactively. When necessary, the controller is responsible for notifying management of potential delays and requesting additional support. A meeting cadence, along with the required attendees, should be clearly identified and included on the month-end close checklist.   

Close Strategy #3: Work Ahead of Schedule 

Companies should continually evaluate, optimize and condense their close checklist to streamline the close process. The following tasks can be scheduled early to facilitate a faster close:  

  • Processing of journal entries: To accelerate the data entry process, many booking entries including depreciation, prepaid expenses, loan interest and other recurring expenses should be entered early in the close process on recurring journal entry templates and only adjusted if material variances are identified.  
  • Utilization of journal entry packages:  Clear journal entry requirements for accrual generation, reviews, approvals and external financial audits are also beneficial. These requirements establish why accrual is necessary, identify the appropriate vendor and customer contractual information, add a framework for the accrual calculation process, note the required backup documents and outline the approval workflow and matrix. Defined journal entry requirements will accelerate the review process, reduce changes and enable better accruals.  

By reconciling accounts in advance, teams can facilitate a straightforward month-end close with defined deadlines to reconcile specific accounts or groups of accounts. It is ideal to schedule the reconciliation shortly after the associated account sub-ledger is closed, or after all account-related entries are posted. Combined with the automation of repetitive tasks, such as data entry and report generation, teams can reduce the risk of errors and improve their efficiency. 

Close Strategy #4: Continuous Trend Analysis 

Ongoing account balance trend analysis, which involves reviewing the account balances to ensure they are trending justifiably, will identify errors or missing entries for accurate financial reports. While it may be appropriate for balances to fluctuate between peer accounts, the total balance will remain consistent month-to-month.  

For example, while the accounts payable and accrued expenses balances will fluctuate depending on how many invoices were vouchered or accrued, the combined balance will be consistent each month. A significant monthly change in the combined accounts payable and accrued expense balance may be reflected as a missing entry or an underlying change to the business, such as ramping up on a new project. It is important to ask questions about account trend variances during the close touchpoint meetings to raise awareness amongst the team about potential account issues in these scenarios. Effective trend analysis helps identify potential issues early, allowing teams to take corrective action before the end of the close process.   


Each of these strategies covers a critical part of the close and, when used together, will dramatically improve the speed and accuracy an organization completes the month-end close process.  These strategies guarantee the team will complete tasks through a structured and recurring process, avoiding pitfalls and alleviating the challenges posed by cross-departmental collaboration. Combined with frequent touchpoints to identify potential stoppages or issues, timeframes can be dramatically reduced without sacrificing financial accuracy, enabling companies to avoid delays in reporting, business performance reviews and customer billings, positively impacting profitability. 

How MorganFranklin Can Help 

If your company takes more than seven days to complete their month-end close process, consider which strategies could be implemented to accelerate the close process. MorganFranklin Consulting’s Government Contracting Advisory Services practice assists clients with drafting, reviewing and updating policies and procedures, implementing systems including Deltek or Unanet and developing change management strategies to ensure success. Our technical accounting solution center is available to conduct contract reviews for ASC 606 compliance, develop standardized forms for internal control use and review contract system setup to ensure consistency with revenue recognition conclusions. With a portfolio of subject matter experts, averaging 20 years of relevant experience each, including former DCAA auditors with industry and consultancy experience, our team is ready to help you solve the most complex problems when contracting with the Federal Government. 

Talk to one of our experts today.