Year-End Close is Done – Now What?

Key Accounting Reviews to Tackle in January

For many businesses, completing the year-end close feels like crossing a finish line. Financial statements are finalized, deadlines are met, and teams are ready to move on. However, January is not the time to disengage from accounting—it is the ideal time to step back and critically review the numbers, processes, and controls that shaped the prior year.

A thoughtful post-close review can uncover errors, improve efficiency, and position your organization for a stronger year ahead. Below are several key accounting reviews every business should prioritize in January.

#1: Review Financial Statements with Fresh Eyes

Once the urgency of the close has passed, financial statements deserve a second look. This review should focus on identifying anomalies, trends, or inconsistencies that may not have been fully examined during the close process.

Key areas to assess include:

• Significant year-over-year variances in revenue, expenses, or margins
• Unusual fluctuations in balance sheet accounts
• Entries made late in the close cycle or based on estimates

This is also an opportunity to confirm that financial statements accurately reflect the company’s operations and are aligned with management’s understanding of performance.

#2: Reconcile and Validate Balance Sheet Accounts

January is the right time to ensure that all balance sheet accounts are fully reconciled and supported with appropriate documentation. While reconciliations may have been completed during close, reviewing them again helps confirm their accuracy and completeness.

Accounts that warrant particular attention include:

• Cash and bank reconciliations
• Accounts receivable and allowance for doubtful accounts
• Inventory and work-in-process balances
• Accrued expenses and prepaid accounts

Clean, well-documented reconciliations reduce audit risk and make future reporting significantly smoother.

#3: Assess Revenue Recognition Practices

Revenue recognition continues to be an area of heightened scrutiny for many businesses. A post-close review should evaluate whether revenue was recognized consistently and in accordance with applicable accounting standards and internal policies.

Consider questions such as:

• Were contracts reviewed for proper revenue timing?
• Were cutoff procedures consistently applied?
• Did any non-recurring transactions require special treatment?

Addressing potential issues early can prevent corrections later in the year and strengthen financial reporting credibility.

#4: Evaluate Internal Controls and Close Processes

The close process itself often reveals where internal controls or workflows need improvement. January is an ideal time to document lessons learned while they are still fresh.

Areas to evaluate include:

• Bottlenecks or delays during the close
• Manual processes that increase error risk
• Segregation of duties and approval controls
• Reliance on spreadsheets versus system-based reporting

Small refinements now can lead to a faster, more accurate close throughout the year.

#5: Prepare for Tax and Audit Readiness

Even if tax filings or audits are months away, January preparation can significantly reduce stress later. Confirm that supporting schedules, documentation, and reconciliations are organized and readily accessible.

This proactive approach helps:

• Minimize last-minute requests from tax advisors or auditors
• Reduce the likelihood of adjustments or rework
• Improve communication between internal teams and external advisors

#6: Align Accounting Insights with Business Strategy

Finally, accounting data should inform—not just report on—business decisions. January is a natural time to align financial insights with operational and strategic planning for the year ahead.

Management should consider:

• Cost structures and profitability by product or service line
• Opportunities for process improvements or cost controls
• Financial metrics that should be monitored more closely

When accounting insights are integrated into planning, finance becomes a strategic asset rather than a compliance function.

Start the Year Strong

Completing the year-end close is an important milestone, but it is not the end of the accounting cycle—it is the beginning of a more informed year. By taking time in January to review financial statements, validate balances, assess processes, and prepare for what lies ahead, businesses can set a solid foundation for the year to come.

At ProNexus, LLC, we work with organizations to strengthen accounting processes, improve financial reporting, and provide clarity beyond the close. If your team would benefit from support with post-close reviews or ongoing accounting needs, we are here to help.