A solid month-end close process keeps your finances accurate and audit-ready. For nonprofits managing grants, it's also essential for compliance and funder reporting.

This checklist covers everything you need to close the books each month.

Illustrative internal timeline (customize; not a GAAP or funder deadline)

Days After Month-End	Tasks
Day 1-3	Bank reconciliation, transaction review
Day 3-5	Accruals, allocations, grant reconciliation
Day 5-7	Management reports, variance review
Day 7-10	Final review, close the period

Week 1: Foundation Tasks

Bank Reconciliation

Download bank statements for all accounts
Reconcile each bank account in QuickBooks
Investigate and resolve any discrepancies
Document any timing differences
Reconcile petty cash (if applicable)

Credit Card Reconciliation

Download credit card statements
Verify all charges are recorded
Ensure proper coding and documentation
Reconcile to statement balance

Transaction Review

Review all transactions entered during the month
Verify proper account coding
Check for missing or inconsistent QuickBooks Online coding required by the organization's accounting design
Verify vendor and customer information
Follow up on any missing documentation

Accounts Payable

Enter all invoices received through month-end
Review aging report
Verify accruals for received-not-invoiced items
Ensure proper grant coding on all payables

Accounts Receivable

Record all receivables through month-end
Review aging report
Follow up on overdue items
Evaluate expected credit losses and record accountant-approved adjustments under the applicable GAAP policy

Week 2: Grant-Specific Tasks

Grant Expense Allocation

Review unallocated transactions
Allocate expenses to appropriate grants
Verify allocation accuracy
Document allocation rationale for non-obvious items

Grant Budget Review

Run budget vs. actual for each active grant
Investigate variances exceeding the organization's documented materiality or review threshold
Document explanations for variances
Identify any needed budget modifications

Indirect Cost Calculation

Calculate indirect costs for each grant
Verify the authorized rate and its defined base; do not assume MTDC or TDC
Check against grant caps
Record indirect costs using the accountant-approved system and entry design, if an entry is required

Grant Fund Receipts

Record any grant payments received
Match to grant receivables
Update fund receipt status
Reconcile grant cash to GL

Restricted Fund Reconciliation

Evaluate which donor time or purpose stipulations were satisfied; spending is evidence, not an automatic release trigger
Prepare accountant-approved reclassification entries or apply a documented same-period policy election where appropriate
Reconcile restricted fund balances
Document restriction status by fund

Accruals and Adjustments

Standard Accruals

Accrue payroll and benefits (if pay period doesn't align)
Accrue unpaid vacation/PTO
Accrue interest expense (loans, credit lines)
Accrue any other known liabilities

Prepaid Expenses

Amortize prepaid insurance
Amortize prepaid rent (if applicable)
Review other prepaid accounts
Post amortization entries

Depreciation

Calculate monthly depreciation
Post depreciation journal entry
Verify accumulated depreciation balances
Update fixed asset schedule

Revenue Recognition (GAAP assessment)

Classify each arrangement as a contribution or reciprocal exchange; the label “grant” does not decide
For a contribution, recognize it only when unconditional; a condition requires both a substantive barrier and a right of return or release under FASB ASU 2018-08
For an exchange transaction, apply the relevant GAAP revenue guidance; do not assume cash receipt or spending establishes revenue
Review pledge receivable payments
Accrue any earned but unbilled revenue

Reports and Review

Management Reports

Generate Statement of Financial Position
Generate Statement of Activities (by fund if needed)
Prepare or support the required natural-by-function expense analysis; a separate statement is not universally required
Generate Cash Flow Statement (optional monthly)

Variance Analysis

Compare to budget and investigate variances exceeding the documented review threshold
Compare to prior month—investigate significant changes
Compare to prior year same month
Document explanations for significant variances

Grant Reports

Generate budget vs. actual for each grant
Review spending pace against grant timeline
Identify grants approaching budget limits
Note any upcoming reporting deadlines

Final Close Tasks

Trial Balance Review

Run trial balance
Verify balance sheet accounts are reasonable
Confirm net assets reconcile to prior month + activity
Review for any unusual balances

Intercompany/Interfund

Reconcile interfund due to/due from accounts
Clear any interfund transfers
Ensure funds balance individually

Documentation

Save bank reconciliations
File supporting documentation
Document any significant judgments or estimates
Note any items for next month's attention

Lock the Period

Review closing checklist completion
Obtain any required approvals
Close the period in accounting system (prevent further changes)
Communicate close completion to stakeholders

Grant Compliance Checkpoints

Monthly grant compliance checks:

All expenses charged to grants have documentation
No unallowable costs charged to federal grants
Personnel costs supported by records and controls appropriate to the organization and applicable awards
Procurement policies followed for purchases
Equipment purchases properly tracked
Subrecipient monitoring current (if applicable)

Upcoming Deadlines Review

Before closing, note what's coming:

List grant reports due in next 30 days
Identify any grant end dates approaching
Note audit preparation needs
Flag any board reporting deadlines

Common Issues to Watch For

Missing Grant Codes

Expenses without Class/Project assignments can indicate:

New vendor needing setup
Staff training gap
Process breakdown

Budget Overruns

Catching overruns early allows time to:

Request budget modifications
Correct coding errors or request an approved rebudgeting; never move costs merely to cure an overrun
Plan for funder conversation

Timing Differences

Watch for:

Expenses recorded in wrong period
Grant start/end date issues
Accrual vs. cash differences

Tips for Efficient Closes

Close consistently — Same process each month builds efficiency
Document as you go — Don't wait until year-end
Use checklists — Don't rely on memory
Set deadlines — Hold yourself to the timeline
Automate where possible — Use tools that reduce manual work

Using This Checklist

Download and customize this checklist for your organization:

Add organization-specific tasks
Assign responsibilities to team members
Set your target close timeline
Track completion monthly
Refine based on experience

How GrantLink supports this today

GrantLink helps by organizing allocations backed by QuickBooks Online, budget lines, fund receipts, funding shares, documents, report outputs, and activity history. QuickBooks Online remains the accounting source of truth; allocations do not inherently rewrite it, and writes require explicit permission and workflow. GrantLink supports audit preparation, but it does not replace funder guidance, accounting policy, or professional review.

Sources

FASB ASU 2018-08 — contribution/exchange classification and conditional contribution recognition
FASB ASU 2016-14 — nonprofit statements, functional expenses, liquidity, and net assets
2 CFR Part 200, Subpart E — federal award cost principles; apply only to covered federal awards