T+5: how to close the month on the 5th business day, without overtime
The norm in 90% of companies is T+14 (closing the month on day 14). We routinely take clients to T+5. Not by burning the accounting team out.
Fast monthly close isn't a speed contest. It's the mechanism that lets May decisions get made on May data. T+14 means half the month is already decided «in the rear-view mirror». T+5 buys back ten premium days.
Seven principles
01 — ESTIMATE, THEN ADJUST
90% of accruals are run-rate based. Don't wait for invoices — post the estimate. 95% accuracy in 5 days beats 100% in 14.
02 — DAILY RECONCILIATION
Bank rec daily, not month-end. Inter-company weekly. A week-1 break gets fixed in week 2, not in month +14.
03 — HARD CUTOFFS
Day 3 of the month, no exceptions. Late invoice? Next period. No «we'll squeeze it in by Friday».
04 — STANDARDIZED COA
One chart of accounts across all entities. If «office supplies» is in 631 in one entity and 685 in another, consolidation is a manual nightmare.
05 — AUTO-ELIMINATIONS
Inter-company invoices tagged at creation, auto-eliminated at close. Not Excel formulas, not VLOOKUPs. ERP integration.
06 — SOFT CLOSE PROGRESSIVELY
Each business day a piece of the close. Day 1: bank rec. Day 2: AP. Day 3: AR + accruals. Day 4: inter-co + reclasses. Day 5: review + sign-off.
07 — MATERIALITY THRESHOLD
Anything below 0.5% of revenue doesn't block close. Found a $400 break? Don't stop — adjust next month.