Closing the books refers to the steps required for financial statement preparation. There are steps that should be followed to ensure journal entries are posted correctly. When journal entries are posted improperly and general ledger balances are inaccurate, there is pervasive business risk involved due to the resulting misstated financial statements.
This close the books sample process flow focuses on the following activities:
This document should be used as a general guide to understand and review this business process. Organizations should customize this tool to ensure that it reflects their business operations and continuously monitor the process to ensure that the steps described are accurate.
- Journal entry preparation and posting
- General ledger account reconciliation
- Financial statement preparation and delivery