Fast Close: A Guide to Closing the Books Quickly, 2nd Edition

Chapter 1 Introduction.

Different Types of Fast Close.

Benefi ts of the Fast Close.

Legal Issues Impacting the Fast Close.

Steps to Achieve a Fast Close.

Summary.

Chapter 2 Your Current Closing Process.

Traditional Closing Process: Basic.

Additional Closing Tasks for the Multidivision Company.

Additional Closing Tasks for the Multinational Company.

Additional Closing Tasks for the Public Corporation.

Problems with the Closing Process.

Summary.

Endnote.

Chapter 3 Conducting a Review of the Closing Process.

Steps in the Process Review.

Payables Process Review.

Billing Process Review.

Inventory Process Review.

Cash Process Review.

Final Closing Process Review.

Total Duration of the Closing Process.

Summary.

Endnote.

Chapter 4 Alter the Timing of Closing Activities.

Altering the Closing Mindset.

Review and Correct Subledger Transactions Throughout the Month.

Complete the Bank Reconciliation Every Day.

Review Uncashed Checks.

Update the Inventory Obsolescence Reserve.

Determine the Lower of Cost or Market.

Calculate Overhead Allocation Bases.

Bill Recurring Invoices.

Conduct a Preliminary Comparison of the Shipping Log to Invoices Issued.

Review Preliminary Rebillable Expenses.

Update the Bad Debt Reserve.

Review Preliminary Billable Hours.

Accrue Interest Expense.

Determine Pension Plan Funding.

Determine Flexible Spending Account Funding.

Accrue Unpaid Wages.

Accrue Unused Vacation Time.

Accrue Travel Expenses.

Reconcile Asset and Liability Accounts.

Calculate Depreciation.

Compile Preliminary Commissions.

Review Financial Statements for Errors.

Complete Selected Financial Reports in Advance.

Deferred Closing Activities.

Summary.

Chapter 5 Revise the Contents of the Financial Statements.

Alter the Mode of Report Delivery.

Standardize Reports.

Eliminate Cost Reporting from the Reporting Package.

Separate Metrics from the Financial Reporting Package.

Summary.

Chapter 6 Optimize the Use of Journal Entries and Chart of Accounts.

Eliminate Immaterial Journal Entries.

Standardize Journal Entries.

Convert to Recurring Journal Entries.

Centralize Use of Journal Entries.

Use Journal Entries to Accrue Expenses Delaying the Close.

Automate Journal Entry Postings.

Use Accruals Only for External Reporting.

Defi ne Accounts.

Standardize the Chart of Accounts.

Automate Eliminations of Intercompany Transactions.

Summary.

Chapter 7 Standardization and Centralization.

Impact of Standardization on the Closing Process.

Impact of Centralization on a Multilocation Accounting Department.

Impact of Centralization on a Single-Location Accounting Department.

Incorporating Standardization and Centralization into Acquisition Activities.

Summary.

Chapter 8 Closing the Inventory Function.

Create an Inventory Tracking System.

Implement Cycle Counting.

Reduce the Amount of Inventory.

Properly Record the Lower of Cost or Market Rule.

Reviewing Obsolete Inventory.

Preventing Obsolete Inventory.

Summary.

Endnotes.

Chapter 9 Closing the Billing Function.

Bill Recurring Invoices in the Preceding Month.

Computerize the Shipping Log.

Eliminate Rebillable Expense Processing from the Core Closing Period.

Eliminate Month-End Statements.

Print Invoices Every Day.

Transmit Transactions via Electronic Data Interchange.

Summary.

Endnote.

Chapter 10 Closing the Payroll Function.

Automatically Calculate Commissions in the Computer System.

Simplify the Commission Structure.

Install Incentive Compensation Management Software.

Post Commission Payments on the Company Intranet.

Avoid Adjusting Preliminary Commission Accrual Calculations.

Use a Bar-Coded Time Clock.

Use a Web-Based Timekeeping System.

Automate Vacation Accruals.

Merge Sick Time into Vacation Time.

Cap the Amount of Vacation Time to Be Carried Forward.

Summary.

Endnote.

Chapter 11 Closing the Payables Function.

Automate the Month-End Cutoff.

Pay Based on Receiving Approval Only.

Automate Three-Way Matching.

Reduce Required Approvals.

Use Negative Assurance for Invoice Approvals.

Use Procurement Cards.

Have Suppliers Include Their Supplier Numbers on Invoices.

Receive Billings Through Electronic Data Interchange.

Request That Suppliers Enter Invoices Through a Web Site.

Audit Expense Reports.

Automate Expense Reporting.

Link Corporate Travel Policies to an Automated Expense Reporting System.

Issue a Standard Account Code List.

Link Supplier Requests to the Accounts Payable Database.

Automate Payments for Repetitive Processing.

Eliminate Manual Checks.

Use a Signature Stamp.

Ignore Supplier Invoices and Pay from Statements.

Issue Standard Adjustment Letters to Suppliers.

Summary.

Endnote.

Chapter 12 Closing the Cash Processing Function.

Access Bank Account Information on the Internet.

Avoid Delays in Check Posting.

Collect Receivables Through Lockboxes.

Install a Lockbox Truncation System.

Access Online Check Images from a Lockbox.

Consolidate Bank Accounts.

Summary.

Endnote.

Chapter 13 Impact of Automation on the Closing Process.

Principles of Fast Close Automation.

Implement Minor Programming Changes on an Ongoing Basis.

Automate General Ledger Interfaces.

Install a Web-Based Timekeeping System.

Install a Workfl ow Management System.

Install Consolidation Software.

Install a data Warehouse.

Install an Enterprise Resources Planning System.

Summary.

Chapter 14 Closing the Books of a Public Company.

Overview.

Constructing the SEC Filing.

Quarterly Auditor Reviews and Audits.

Quarterly Legal Review.

Offi cer Certifi cation.

Audit Committee Approval.

EDGARizing.

Summary.

Chapter 15 Controls for Financial Reporting.

Overview.

Controls for Financial Reporting.

Summary.

Chapter 16 Ongoing Improvements in the Closing Process.

Ongoing Improvement Process.

Improvement Measurements.

Summary.

Appendix A Comprehensive Closing Checklist.

Appendix B Fast Close Policies and Procedures.

Appendix C Soft Close Checklist.

Appendix D Year-End Close Checklist.

Index.