Month-End Close (and month-end reconciliation)
The month-end close turns a month of transactions into finished financial statements: reconcile every account, post COGS and accruals, value inventory, review for anomalies, then lock the period so nothing moves afterward. A closed month is final; a merely categorized month is a draft. Speed matters as much as accuracy, because statements delivered six weeks late describe a business that no longer exists. Our standard is the 10th business day.
The cost of a slow close is bad decisions made on stale numbers. A seller scaling ad spend in March off December's last-closed P&L is flying on instruments from three months ago; if contribution margin slipped in January, the overspend runs undetected for a quarter. Close by day 10 and the feedback loop tightens to days: February's real margins are on the table while February's decisions are still fresh enough to correct.
The month-end close checklist
A close for a multichannel seller runs in a fixed order, because later steps depend on earlier ones. First, month-end reconciliation of every cash and clearing account: bank, credit cards, each marketplace and gateway against its settlement or payout reports. Second, revenue and fees posted from those settlements, with refunds, reserves and sales tax collected in their own accounts. Third, inventory: pull platform and 3PL quantities, value them at landed cost, and post COGS on what sold. Fourth, accruals and prepaids: the ad invoice that hasn't arrived, the annual software bill spread over twelve months, the freight on a container that landed on the 29th. Fifth, review: compare every P&L line to last month and to budget, and chase anything that moved more than it should have. Sixth, lock the period and issue statements.
Why day 10, and not day 30
Marketplace settlement timing sets the floor. Amazon's last settlement for a month typically lands in the first week of the next one, and the FBA inventory reports needed for COGS are available by then too. Beyond that, delay is process, not data. A firm delivering on day 30 or 45 has been waiting on a queue, not on Amazon.
Locking the period
Locking is the underrated half. When prior months stay editable, a stray edit in June silently changes January's numbers, and suddenly reports don't match what you sent the bank. Closed periods are why your trailing-twelve-month statements stay consistent through a loan application or a sale process. Some sellers run a soft close by day 5, a fast draft with estimated COGS for the operators, then a hard close by day 10 once every count and settlement is in. That works well at scale. What doesn't work is a permanent soft close, where numbers stay "preliminary" for months and nobody trusts them enough to act.
Common questions
What's the difference between month-end reconciliation and the close? Reconciliation is one step, proving balances against outside records. The close is the whole process that step sits inside, ending with locked, reviewed statements.
What if a transaction turns up after the period is locked? Post it in the current month with a note. Reopening a closed period is allowed but should be rare and logged, because every reopen changes reports you've already sent to someone.
Who does the close in a small business? Whoever keeps the books, on a written checklist. The day-10 close is the guarantee at the center of our monthly bookkeeping, and it's written into our published pricing: miss it and the month is half price.
Where this shows up in our work
This isn’t textbook material for us; it’s the day-to-day of keeping seller books right. See how we handle it in practice:
Monthly Ecommerce Bookkeeping →