Month-end close

A close is complete when every balance-sheet account is reconciled to support, every accrual and prepaid has been updated, stock compensation and depreciation have been booked, intercompany and foreign currency balances are settled, and the income statement has been reviewed against budget with explanations for variances. At a well-run biotech it finishes within ten to fifteen business days.

The close calendar assigns owners and deadlines to each task, and a checklist documents that each was done and reviewed. That documentation is itself a control, and the first thing an auditor uses to decide how much to rely on the company's process.

Companies without a disciplined close discover their real financial position at year-end, when it is too late to manage it. The close is also what makes the board package, the cash forecast, and the audit possible; skipping it does not save time, it moves the time to a worse moment.