Year-end close readiness checklist

Why run this

What this checklist is for

Nonprofit year end carries obligations a commercial close does not: fund restrictions, grant conditions and an audit that examines whether restricted money was spent as intended.

Most of the work below is cheaper done in advance than during the close, and considerably cheaper than during the audit.

Run it with

Finance director or treasurer

And with

Finance team

And with

Programme managers for grant confirmation

The checklist

20 checks, in the order we would run them

Tick only what you can genuinely evidence today. An item you intend to do is not an item you have done, and scoring yourself generously here only produces a comfortable number and an uncomfortable project.

Section 1

Fund and restriction position

The part that distinguishes a nonprofit close.

Restricted and unrestricted funds are separated in the ledger, not in a spreadsheetA spreadsheet-maintained fund position is a risk your auditor will identify and your finance team already knows about.
Every restricted fund reconciles to its grant agreementThe agreement is the source of truth for what the money may be spent on.
Restriction releases are documented with the condition that was metReleasing a restriction without recording why is the finding auditors most reliably raise.
Multi-year grants are apportioned across periods correctlyRecognition timing on multi-year funding is a common and material error.
Fund balances are reviewed by somebody other than whoever maintains themPreparer and reviewer should not be the same person, particularly in a small finance team.

Section 2

Grant and programme reconciliation

Where finance and programmes have to agree.

Expenditure coded to funding source at entry rather than reallocatedReallocation at year end is both laborious and difficult to evidence.
Programme managers have confirmed the expenditure attributed to themThey know what was actually delivered. Finance knows what was coded. These differ more than expected.
Grant conditions with spending deadlines are checked against actualsUnderspend on a deadline-bound grant may need returning, and knowing in advance changes the options.
Cost allocation methodology is documented and consistently appliedShared costs allocated differently between periods produce trends that are artefacts.
In-kind contributions are recorded and valued consistentlyFrequently omitted, and material for organizations relying on volunteer contribution.

Section 3

Standard close

The ordinary work that still has to happen.

Bank reconciliations complete for every accountIncluding dormant and restricted accounts nobody looks at monthly.
Accruals and prepayments reviewed against supporting documentationThe supporting documentation is what the audit will ask for, so gather it now.
Fixed asset register reconciled and depreciation postedIncluding donated assets, which are commonly missing from the register.
Debtors and creditors reviewed with old items resolvedAged items on a small balance sheet are disproportionately visible to an auditor.
Intercompany or related-party balances agreed with the other sideAgreed in writing, not assumed to match.

Section 4

Audit preparation

What makes the audit shorter and cheaper.

The audit schedule is agreed with your auditor and diarisedIncluding who from your team is needed and when.
Supporting documentation is assembled before the auditor asksThe audit cost is largely a function of how quickly you can produce evidence.
Prior-year audit findings have been addressed and can be demonstratedA repeated finding is more damaging than a new one.
Access for the auditor is arranged with appropriate permissionsRead-only access to the system beats emailing extracts, for both parties.
Trustees have seen a draft position before the formal papersSurprises in a board pack are worse than bad news delivered early.

What your score means

Read this against the number above

These bands are deliberately blunt. The middle band is where most organizations honestly sit, and it is a perfectly reasonable place to proceed from — provided the gaps are written down with owners rather than carried as optimism.

0–59%Significant gaps

Do not proceed yet. More than four in ten items are unaddressed, and the ones that fail here are usually the foundational ones that make everything after them harder.

60–84%Mostly ready, with known gaps

Proceed on a defined scope, with the outstanding items written into the plan as risks with owners and dates. This is the most common honest position.

85–100%Ready

The remaining gaps are small enough to handle during delivery rather than before it. Confirm the unticked items are genuinely minor rather than simply unexamined.

Your score highlights automatically as you tick items above. Nothing is saved, sent or tracked — refreshing the page clears it.

Closing the gaps

If you could not tick these, start here

The four items below are the ones whose absence causes the most trouble downstream. If your unticked items include any of these, they are worth addressing before the rest.

Funds tracked in a spreadsheet

Move restriction tracking into the ledger with dimensions. This is the single change that most reduces audit effort year on year.

Expenditure reallocated at year end

Code at entry instead. It is a process change in finance rather than a system project, and it removes weeks of close work.

Programme managers not consulted

Ask them before the close, not during the audit. The differences they identify are easier to resolve with time available.

Prior findings unaddressed

Deal with them before the auditor arrives. Repeat findings raise questions about governance rather than about accounting.

Want a second opinion on your score?

We will review your fund and dimension structure and show you what tracking restrictions in the ledger would look like against your actual grant portfolio.

Talk through your result Read the related guides We reply to every message within one business day.

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What this checklist is for

Run it with

And with

And with

20 checks, in the order we would run them

Fund and restriction position

Grant and programme reconciliation

Standard close

Audit preparation

Read this against the number above

If you could not tick these, start here

Funds tracked in a spreadsheet

Expenditure reallocated at year end

Programme managers not consulted

Prior findings unaddressed

Want a second opinion on your score?

Related checklists

Reporting capability readiness checklist

Donor and supporter data protection audit

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