---
title: "The month-end AP close checklist"
description: "The AP close in six steps, with September's roll-forward and an October tie-out that is short by $5,100: the manual entry nobody entered as a bill."
canonical: "https://lopifi.com/learn/month-end-ap-close-checklist"
---

# The month-end AP close checklist

> The AP close in six steps, with September's roll-forward and an October tie-out that is short by $5,100: the manual entry nobody entered as a bill.

Source: https://lopifi.com/learn/month-end-ap-close-checklist
Part of: Lopifi — Planned: US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

---

**What do you do in accounts payable at month end, and in what order?** The AP close in six steps, with September's roll-forward and an October tie-out that is short by $5,100: the manual entry nobody entered as a bill.

The accounts payable close answers five questions in order. Are all the bills in? Is every cost with no bill yet accrued? Is every payment recorded? Does the subledger equal the control account? Is anything stale? Each one has a check, and the order matters: you cannot tie out a ledger that is still receiving entries.

Bills in (Enter or chase every bill received, dated by when the goods or service arrived.) → Payments recorded (Every payment run released, matched to its bill.) → Accruals (Received-not-billed costs accrued; last month's accruals reversed.) → Statements (Vendor statements for the vendors that matter.) → Tie-out (Aging equals account 2000; the roll-forward walks.) → Sign and lock (Review, sign, and lock the period.)

The AP close, in order. The tie-out comes after everything that can change the balance.

1. **Get every bill in.** Post every approved bill dated in the period, and chase the stragglers. The [cut-off](https://lopifi.com/md/learn/recording-bills-and-accrued-expenses) test is when the goods arrived, not the bill date.
2. **Record every payment.** Every released payment is matched to its bill, and the bank reconciliation agrees. A payment coded straight to expense from the bank feed books the cost twice.
3. **Accrue what has no bill.** Run the [search for unrecorded liabilities](https://lopifi.com/md/learn/vendor-statements-and-ap-tie-out/unrecorded-liabilities-search), accrue what it finds, and reverse last month's accruals.
4. **Check vendor statements.** Reconcile the statements of the vendors that matter, and chase what does not agree. See [the statement lesson](https://lopifi.com/md/learn/vendor-statements-and-ap-tie-out).
5. **Tie out.** Prove the aging against account 2000 and walk the roll-forward from last month's balance. A difference gets a name, an owner and a date.
6. **Review, sign, lock.** Look for debit balances, stale bills and duplicate payments. Then a second person reviews the file, signs it, and the period is locked.

The AP close checklist.

## The tie-out in numbers

The roll-forward walks the account from last month's balance to this month's: opening, plus the bills posted, less payments and credits, equals the closing balance. September is the company's first month, so the account opens at zero.

|  | Amount |
| --- | --- |
| Opening balance, September 1 | 0 |
| Bills posted (JE-4) | 18,000 |
| Payments (JE-9) | (12,000) |
| Closing, account 2000 | 6,000 |
| AP aging total | 6,000 |
| Difference | 0 |

September, from the book. The aging is the subledger; account 2000 is the control account.

October is busier. The book posts 4 bills to account 2000 in October, and the drill bill's open $6,000 is paid on its due date (the track's assumption, as in the payment-run lesson). Suppose the shelving installer's invoice was posted by journal entry straight to 2000 and was never entered as a bill in the bill-pay tool. Then the control account carries it and the aging does not.

|  | Amount |
| --- | --- |
| Opening balance, October 1 | 6,000 |
| Bills posted to 2000 | 10,772.80 |
| Payments | (6,000) |
| Closing, account 2000 | 10,772.80 |
| AP aging total (bill-pay tool) | 5,672.80 |
| Aging less account 2000 | (5,100) |

October, with the aging taken from the bill-pay tool at October 31, 2026.

The aging is short by $5,100, which is exactly the shelving entry. A manual journal posted to a control account is the first thing to look for when the two disagree, because nothing in the subledger knows about it: no vendor, no due date, no invoice number to pay. The fix is to put the bill through the subledger and take the manual entry out. Since a posted entry is reversed and not edited, it takes two steps.

Then enter the installer's invoice as a bill coded to store fixtures. It debits 1510 and credits accounts payable through the subledger, with the vendor, the invoice number and the due date attached, and the aging and the ledger agree again.

**Scenario — The tie-out is off at four o'clock.** It is the last day of the close. The aging says $5,672.80, the ledger says $10,772.80, and the preparer is tempted to book the $5,100 to a suspense account and move on. Instead she lists every entry to account 2000 that did not come from a bill. One is left, the shelving, and the gap has a name.

**Exercise — Tie out October's payables to the ledger.** At 2026-10-31, the drill bill's balance has been paid and every October bill is still open. Suppose the entry marked "Journal entry only" was posted straight to account 2000 and never entered as a bill. For each line, write what the bill-pay tool's aging lists (a line it does not list is zero) and the gap between that and what was posted to account 2000. Type it in the workbook at https://lopifi.com/playground.

| Check | Evidence | Looking for |
| --- | --- | --- |
| Aging equals account 2000 | The aging and the trial balance, same date | A difference of any size |
| Roll-forward walks | Last month's closing, this month's activity | A movement with no bill or payment |
| No vendor with a debit balance | Aging by vendor | A refund to chase, or a duplicate payment |
| Old bills | Aging, 61 days past due and beyond | A dispute, a bill paid some other way, or a missed invoice |
| Accruals reversed and refreshed | The accrual schedule against 2200 | A balance that never clears |
| Manual entries to 2000 | The journal list, filtered to the account | Anything with no bill behind it |

What a reviewer checks.

— [SEC Release 33-8238 (June 2003) — Sarbanes-Oxley §404](https://www.sec.gov/rule-release/33-8238), Management's report on internal control over financial reporting

> **Tip.** **Close in the same order every month,** from the same checklist, and have a second person sign it. **Run the aging and the trial balance at the same moment,** after the last bill and payment are posted, so a late entry does not look like a difference. **Keep a list of the recurring accruals** (power, a monthly retainer) so they are accrued on purpose and not remembered.

> **Mistake.** Locking the period before the tie-out. A lock should follow the tie-out, not come before it. Locking first leaves the choice between reopening the period and carrying a known difference forward, and both are worse than another hour before the lock.

> **The subledger and the control account either agree or there is a finding. The close is the day someone proves it, in writing.**

## Where this lesson's rules come from

- [SEC Release 33-8238 (June 2003) — Sarbanes-Oxley §404](https://www.sec.gov/rule-release/33-8238) — Management's report on internal control over financial reporting (sec)
- [ASC 405](https://asc.fasb.org/405/tableOfContent) — Liabilities (codification)
- [CON 8, Introduction — as amended by Ch. 4, App. A (carrying forward CON 6, ¶139)](https://www.fasb.org/concepts-statements) — What accrual accounting is for (concepts)

## Read further

- https://lopifi.com/md/journal-entries/accrued-expenses
- https://lopifi.com/md/journal-entries/accounts-payable
- https://lopifi.com/md/differences/soft-close-vs-hard-close
- https://lopifi.com/md/startups/accrued-expenses-vs-accounts-payable
- https://lopifi.com/md/startups/accounts-payable-process-for-startups
- https://lopifi.com/md/accounting/close
- https://lopifi.com/md/accounting/reconciliation
- https://lopifi.com/md/accounting/period-locks
- https://lopifi.com/md/docs/domain/periods-and-close
- https://lopifi.com/md/docs/domain/controls-and-audit
- https://lopifi.com/md/docs/domain/schedules-and-accruals

- **Track:** [Accounts payable](https://lopifi.com/md/learn/ap)
- **Lesson:** Lesson 13 of 21 — 10 min
- **Terms taught:** [Close](https://lopifi.com/md/glossary/close), [Soft close](https://lopifi.com/md/glossary/soft-close), [Hard close](https://lopifi.com/md/glossary/hard-close), [Tie-out](https://lopifi.com/md/glossary/tie-out), [Subledger](https://lopifi.com/md/glossary/subledger), [Control account](https://lopifi.com/md/glossary/control-account), [Sign-off](https://lopifi.com/md/glossary/sign-off), [Reversing entry](https://lopifi.com/md/glossary/reversing-entry), [AP reconciliation](https://lopifi.com/md/glossary/ap-reconciliation)
- **Previous:** [Prepaid, expensed or capitalized: what a bill buys, AP · Lesson 12](https://lopifi.com/md/learn/prepaid-expensed-or-capitalized-bills)
- **Next:** [Paying early, on time or late: AP and cash, AP · Lesson 14](https://lopifi.com/md/learn/paying-early-on-time-or-late)
- **The course:** https://lopifi.com/md/learn