Manufacturing Month-End Close Checklist (Free)

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12 critical items still open - these are the highest-risk gaps.

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Cut-off and transactions

Lock the inventory and production transaction period in the ERP after the cut-off timeCRITICALConfirm all goods receipts are posted in the correct periodCRITICALReview received-not-invoiced balance and accrue for itCRITICALConfirm shipments and invoices are cut off at the same dateCRITICALCheck for open transactions in staging or error queuesPost accruals for utilities, freight and unbilled servicesReview intercompany transfers in transit

Inventory and WIP

Reconcile the inventory subledger to the general ledger by accountCRITICALReconcile WIP by job to the WIP account and investigate differencesCRITICALClose or cancel completed and obsolete work ordersReview negative on-hand balances and correct themCRITICALProcess cycle count adjustments and approve shrinkageReview slow moving and obsolete stock and update the reserveRun a lower of cost and net realizable value test on at-risk itemsConfirm consigned and customer-owned inventory is excluded

Costing and variances

Run labor and overhead absorption and confirm rates appliedCRITICALReview purchase price variance by supplier and partReview material usage, labor rate and efficiency variances by work centerSettle production order or job variances to the correct accountsCRITICALCalculate over or under applied overhead and post the adjustmentReview scrap and rework cost against budgetCheck standard cost changes made in the period are approved and documentedWrite a short commentary on variances above the threshold

Payroll, fixed assets and accruals

Reconcile direct labor hours booked to time-and-attendanceCRITICALAccrue wages, bonus and vacation liabilitiesPost depreciation and confirm new assets are capitalizedReview capital project spend and move completed projects out of construction in progressReview prepaid expenses and warranty reserve

Reconciliation and reporting

Reconcile accounts payable and receivable subledgers to the ledgerCRITICALReconcile bank and cash accountsReview foreign currency revaluation and post the entryReview the trial balance for unusual movementsPrepare the COGM and COGS schedule and tie to the income statementCRITICALProduce the flash report with gross margin and key variancesGet plant manager sign-off on operational explanationsLock the financial period and archive the close package

Tick each item as completed. Items marked critical must be finished before you release the close. A score below 80 percent means the close is at risk of restatement or late adjustment.

Daily close exception reports from your ERP

Optional: we can outline read-only exception reports that shorten your close.

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How to use the checklist

Work through the groups in order, and tick items as they are completed. Items marked critical block the close: if one fails, the financial statements may be materially wrong. Assign an owner and a due working day to every item the first time you use the list, then keep the same assignments each month. Export the ticked list to PDF as the close evidence for your auditors.

Assign an owner and a working-day target to each line
Run reconciliations before variance analysis, not after
Keep a record of adjustments and who approved them
Add plant-specific items such as customs, tooling or consignment

Why the order matters

Cut-off errors flow into everything downstream. A receipt posted in the wrong period distorts inventory, accounts payable and PPV together. Fix transactions first, then reconcile subledgers, then review costing and variances, and only then prepare the management report. If you analyze variances before reconciling, you will analyze numbers that change.

Typical problem areas

Negative inventory balances, jobs that are complete but still open, unprocessed receipts and unmatched invoices cause most late adjustments. Over or under applied overhead is another: if the rate was set from a budget that no longer fits, the adjustment can be large. Set a materiality threshold for investigation so effort goes to the largest items first.

Speeding up the close

Plants that close quickly usually do three things: they run daily exception reports (negative stock, unposted transactions, unmatched receipts), they lock the period in the ERP on a fixed schedule, and they automate the standard reconciliations. Each of these converts last-day surprises into small daily fixes. A 5 to 6 working day close is a realistic target for a mid-size plant, though complexity and multiple entities add time.

Frequently Asked Questions

How long should a manufacturing close take?

A mid-size single-plant company can often close in 5 to 8 working days. Multi-entity groups with intercompany and currency work usually take longer. Faster is possible when exceptions are cleared daily.

Which items are always critical?

Cut-off, inventory and WIP reconciliation, variance settlement, overhead absorption and the COGM to COGS tie-out. These directly determine gross margin and inventory on the balance sheet.

Do I need to count inventory every month?

Not usually. Cycle counting through the year with a full count or a statistical count at year end is common. You do need to review negative balances and count adjustments each month.

Can I customize the list for my ERP?

Yes. Add the exact ERP steps, such as your period-end transaction codes or job settlement runs, to the matching items and keep the list under version control with your close calendar.

Many of these checks can be run automatically as exception reports from your ERP data. We can help set up read-only close monitoring. Ask for an expert review.

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Manufacturing Month-End Close Checklist