Reconciliation & Close
Bank and credit-card reconciliations, the month-end close as a repeatable checklist, accruals and deferrals, and the review habits that catch errors while they are still cheap to fix.
Start here
5 piecesNo background assumed — the pieces that build the foundation.
Guide · Intro · 8 min
Bank reconciliation from first principles
How to reconcile a bank account: why the book balance and bank balance differ, the step-by-step procedure, a fully worked example, and how to diagnose a reconciliation that will not balance.
Brief · Intro · 3 min
Locking closed periods: the cheapest control in your books
Why setting a closing date and password in your ledger software matters, who should hold the password, and how to fix prior-period errors without unlocking anything.
Brief · Intro · 3 min
How often to reconcile each account: a frequency guide
Bank and credit card accounts reconcile monthly, payment processors and payroll liabilities at least monthly, loans and fixed assets quarterly, and everything on the balance sheet at least annually. Here is the schedule by account type.
Brief · Intro · 3 min
Cash drawer reconciliation: the daily count and the over/short account
Count the drawer at close, compare it to what the register says you took in, and book any difference to Cash over and short. Here is the daily routine and the entries.
Brief · Intro · 3 min
Credit card reconciliation: same discipline, different statement
How to reconcile a business credit card: match every charge to the statement, handle the statement-date vs. month-end gap, and record the payment against the card liability.
The working layer
14 piecesThe day-to-day rules, mechanics, and habits.
Guide · Working · 7 min
Adjusting entries: the four families and how to post them
Accrued expenses, accrued revenue, prepaids and deferrals, and depreciation — what each adjusting entry does, the journal entry for each, how reversals work, and which adjustments belong to your accountant.
Guide · Working · 6 min
The month-end close as a repeatable system
A complete month-end close checklist for small-business books: reconciliations, AR/AP review, accruals, depreciation, loan splits, owner accounts, statements, and locking the period — with a day-by-day calendar.
Brief · Working · 3 min
Writing off stale checks that never clear
Outstanding checks that ride the reconciliation for months: when and how to void them across periods, the reissue decision, and the unclaimed-property rules that limit your options.
Brief · Working · 3 min
Opening balance problems: where they come from and the clean-start fix
Wrong opening balances poison every reconciliation after them. The four common sources, how to diagnose which one you have, and the clean-start procedure that fixes it.
Brief · Working · 3 min
Discrepancy hunting: finding reconciliation differences fast
A fixed diagnostic order for tracking down a reconciliation difference — interrogate the number first, then the entries — including the divisible-by-9 and halving tricks.
Brief · Working · 3 min
Year-end close vs. monthly: what December adds
The year-end close is the monthly close plus a second layer: 1099 preparation, physical inventory, owner-account cleanup, annual reconciliations, and the accountant handoff package.
Brief · Working · 3 min
The suspense account: parking the unknown properly
A suspense account is a visible, temporary home for transactions you cannot yet classify — legitimate only if it is emptied every month. How to use one without letting it rot.
Brief · Working · 3 min
The monthly depreciation entry between tax returns
How to book depreciation each month from the accountant's schedule, keep accumulated depreciation tied to it, and handle new assets bought mid-year before the next return.
Brief · Working · 2 min
Deferred revenue: earning out customer prepayments
Money customers pay before you deliver is a liability, not income. The deferred revenue schedule and the monthly release entry that earns it out correctly.
Brief · Working · 3 min
Accrued expenses: recognizing costs before the bill arrives
What an accrued expense is, the entry and its reversal, and an honest look at when accruals matter at small scale — and when they are more ceremony than information.
Brief · Working · 2 min
Prepaid expenses: the schedule and the monthly entry
How to book a prepaid expense, build the amortization schedule that controls it, and post the monthly release so each month carries only its own share of the cost.
Brief · Working · 3 min
Loan balance reconciliation: matching the books to the lender
Why the loan balance on your books drifts from the lender's statement — usually a bad principal/interest split — and how to true it up at least once a year.
Brief · Working · 3 min
Payroll liability reconciliation: tying the books to the filings
Each quarter, the payroll liability accounts on your balance sheet should tie to Form 941 and your deposit records. Here is the tie-out procedure and what a leftover balance means.
Brief · Working · 3 min
Reconciling payment processors: the clearing-account pattern
Processor payouts arrive net of fees and days after the sale. A clearing account lets you record gross sales, processor fees, and bank deposits so all three tie out every month.
Pro details
1 piecesThe edge cases and judgment calls.