Most of the days in a slow close are not work. They are waiting, plus rework.
Fix it in order: cut-offs, reconciliations, accruals, ownership, a close calendar, then automation where it removes waiting.
A faster close is the means. Decisions on capital allocation are the outcome.
I have rebuilt the reporting and the month-end close at two businesses in a row. At the first, a manufacturer, the close went from 21 days to 5. At the second, a renewable-energy retailer, it went from 10 days to 5. In both, the board used the new reporting for capital allocation.
That last sentence is the point. A faster close is not a finance team’s trophy. It is how the people running the business get numbers while they can still act on them.
Where the days go
Exhibit 2
Most of the days in a slow close are waiting and rework, not work
Waiting for
Supplier invoices to arrive
Someone to approve a journal
A reconciliation that only happens once a month
Operational data from another team
The one person who knows how an account works
Rework from
An error found late, which sends the team back to the start
Reviews at the end, so problems surface at the end
Map the close as it actually runs. List every task, who does it and what it waits on. Put it on one page.
Once you see the close as a chain of waits, the fix becomes a sequence.
What to fix, in order
Exhibit 3
Six fixes, in order: each one depends on the one before it
Told what is needed, and by when01
1. Cut-offs
Firm rules for what belongs in the month and what gets accrued. Tell sales, operations and purchasing what you need from them, and by when.
Daily or weekly, not monthly02
2. Reconciliations
Move them out of month-end. Month-end becomes confirming what you already know, not discovering what went wrong.
03
3. Accruals
Stop waiting for the last invoice. Estimate on a documented basis and true it up next month. A sound estimate early beats an exact figure late.
04
4. Ownership
A named owner and a backup for every task and every balance-sheet account. When knowledge sits with one person, the close runs at that person’s pace.
What is finished, day by day05
5. A close calendar
Write the close out day by day and publish it. Run a short check-in each morning during the close. People hit dates they can see.
06
6. Automation
Bank feeds, matching rules, recurring journals, and operational data that flows straight into the ledger. Automate the waiting, not the judgement.
The order matters. Each step depends on the one before it. Teams that start with software usually end up with a faster version of the same problems.
More detail
Accruals. Set an accrual policy, keep a standing schedule and agree a materiality threshold. Estimate on a documented basis and true it up next month.
Ownership. Each reconciliation is signed off by its owner.
Automation. AI is a strong lever here where it fits, but only after the first five steps. Automate a broken process and you get a faster broken process.
Keep the quality
Exhibit 4
A fast close only counts if the numbers hold and the team isn’t straining
01
Track late adjustments
If numbers keep moving once they are reported, the close isn’t really finished on day 5.
02
Watch the team
If day 5 needs late nights and heroics, the process isn’t fixed. It is being propped up.
A close that is fast and wrong is worse than a slow one. A sustainable close is routine, and boring.
What a faster close is for
Exhibit 5
At day 5 the board decides on evidence; at day 21 it decides on instinct
At day 21
The next month is already three weeks old
Any problem has had weeks to grow
Decisions get made on instinct, because the evidence is late
At day 5
Management sees the month while it is still fresh
The board sees where capital earns a return
It decides where the next dollar goes
The faster close was the means. Capital allocation was the outcome. In both businesses, that is how the board used the reporting.
That shapes the reporting too. A good pack is short. It shows the result, the cash and the few measures that drive the business, with commentary that explains movements instead of repeating them. If the board can’t make a decision from it, it needs another rewrite, however fast it arrives.
What to do first
Exhibit 6
One afternoon shows you where your days go
01Map your close
Task by task, with the waits marked: who does each task and what it waits on.
02See where the days go
You’ll see it within an afternoon.
03Work through the order
Cut-offs first, automation last. One step at a time.
04Hold each gain
Hold each gain before you take the next.
Common questions
Why does a month-end close take so long?
Most of the days are not work. They are waiting for supplier invoices, journal approvals, monthly reconciliations, operational data and the one person who knows an account, plus rework when an error is found late.
What should I fix first to speed up the close?
Cut-offs. Agree firm rules for what belongs in the month, and tell sales, operations and purchasing what you need and by when. Reconciliations, accruals, ownership, a close calendar and then automation follow, in that order.
How do I know a faster close is still accurate?
Track adjustments made after the close. If numbers keep moving once they are reported, the close isn’t finished. Watch the team too: if day 5 needs late nights, the process is propped up, not fixed.
Should I automate the close first?
No. Automation, including AI where it fits, is a strong lever only after cut-offs, reconciliations, accruals, ownership and a close calendar. Automate a broken process and you get a faster broken process. Automate the waiting, not the judgement.
Chartered Accountant (CA ANZ) and finance executive, based in Canberra. Practical AI and automation for SMEs, and adviser to owners, CEOs and boards on integration and finance.
Want an outside view of where your close loses its days? The Diagnostic is a short, fixed-scope review, usually one to two weeks, that ends in clear priorities.
Renzo Demartini