1. Do we have a comprehensive checklist that outlines all close activities and assigned individuals that will carry these out with expected deadlines? Is it communicated to all involved in the close process?
Dr. Atul Gawande wrote an inciteful book, “The Checklist Manifesto,” detailing the need for checklists, even for routine tasks. It is a fact that people forget routine things, sometimes with tragic consequences.
2. Do we have an instruction manual and standard templates for critical tasks of the close process? Does it include screen captures to illustrate the steps?
3. Do we use the right systems and tools to reduce errors and close timely?
4. Do we have a chart of accounts listing along with purpose of each account? Are vendors setup with default posting accounts?
5. Do we have adequate review and controls in place to ensure high risk and material items are reviewed? Do you have a way of keeping up with relevant accounting pronouncements?
6. Do we conduct a periodic brainstorming session to reflect on issues faced and come up with improvement recommendations? For example: Are there audit entries that you can incorporate into the recurring close process?
Having asked these questions, organizations can identify the areas that can alleviate the struggle each month. The discussions around these questions can help uncover root causes of ongoing errors and may prevent future errors.