A reliable close is the foundation for every other number: the board pack, the burn multiple, the 409A, the tax return. The checklist below is the sequence we run for SaaS companies on accrual accounting. The order matters, because later steps depend on earlier ones being right.
1. Cash
- Reconcile every bank, card and payment-processor account to statements.
- Match payment processor payouts to gross charges, fees, refunds and chargebacks; book fees as expenses, not netted out of revenue.
- Clear the "undeposited" or clearing accounts to zero or explain every open item.
2. Revenue
- Confirm billings for the month against the billing system.
- Post revenue recognition from the revenue schedule (ASC 606).
- Roll deferred revenue and tie it to the ledger.
- Review new contracts for non-standard terms: implementation fees, ramps, credits, refund rights.
3. Receivables
- Age AR, follow up past-due accounts, and assess any allowance for doubtful accounts.
- Record credit memos issued during the month.
4. Expenses and payables
- Enter all vendor bills dated in the month; accrue for services received but not yet billed (hosting, contractors, legal).
- Code every transaction to the right department and to cost of revenue versus operating expense.
- Review AP aging for duplicates and stale items.
5. Payroll and people costs
- Reconcile payroll registers to the ledger: wages, employer taxes, benefits, contractor payments.
- Accrue earned but unpaid wages, bonuses and commissions.
- Record stock-based compensation expense from the equity system.
- Capitalize and amortize sales commissions under ASC 340-40 where required.
6. Prepaids, fixed assets and other balance sheet accounts
- Amortize prepaid software, insurance and annual contracts.
- Record depreciation and any capitalized software amortization.
- Reconcile every balance sheet account to a supporting schedule.
7. Intercompany and entities
- For multi-entity groups: book intercompany charges, reconcile intercompany balances to each other and eliminate them in consolidation.
8. Review
- Flux review: compare each P&L and balance sheet line to last month and to budget, and explain material movements.
- Review the trial balance for anything unusual: negative balances, suspense accounts, misclassifications.
9. Lock and report
- Lock the period in the accounting platform so later entries cannot change a closed month.
- Publish the finance pack: P&L, balance sheet, cash flow, ARR bridge, burn multiple, runway, budget versus actuals, deferred revenue roll-forward.
Making it repeatable
The close gets faster when the same steps run in the same order each month, reconciliations are automated where the data allows, and every schedule is saved with the close so nothing has to be rebuilt for an audit. We close on time every month, so you know your numbers when you need them.
Who does what
| Step | Typical owner |
|---|---|
| Bank, card and processor reconciliations | Bookkeeping |
| Revenue schedule and deferred revenue | Accounting, with billing data from revenue operations |
| Vendor bills and accruals | Accounting, with input from budget owners |
| Payroll reconciliation and stock comp | Accounting, with data from payroll and the equity platform |
| Flux review and sign-off | Controller or finance lead |
| Finance pack and commentary | Finance lead with the CEO |
Even when one firm runs every step, naming the owner of each input (sales for contract terms, department heads for accruals) keeps the close on schedule.
The close file
Save every reconciliation, schedule and supporting report for the month in one place, named consistently. It becomes the audit file, the diligence file and the answer to every "where did this number come from" question.
Sources
Questions founders ask
How long should a SaaS close take?
It depends on volume, systems and how much is automated. What matters most is that it closes on the same schedule every month and nothing is skipped to hit a date.
Cash or accrual for the close?
Accrual. GAAP financials, ASC 606 revenue and any audit or diligence require it, even if your tax return uses a different method.
