Month-End Expense Accrual Checklist

An expense accrual review asks whether costs relevant to the reporting period may be absent from the ledger because an invoice, employee submission, or other source record has not arrived or been posted. It is a cutoff and completeness decision, not a general reconciliation of every account. The review should start from evidence of goods or services received and the organization’s accounting policy—not from an assumption that every open purchase request, card authorization, or expected invoice is an expense to accrue.

Checklist: define the population and inspect evidence

1. Set the close cutoff and identify the expense accounts, teams, card activity, invoices, and employee submissions in scope.
2. Review late-arriving invoices and post-period transactions for evidence that the underlying goods or services relate to the closing period.
3. Ask budget or activity owners about material known costs that have been incurred but not yet submitted or invoiced.
4. Check open commitments and purchase records as leads for investigation, not automatic proof of an incurred expense.
5. Record the source, period rationale, amount basis, reviewer, and any uncertainty for each proposed entry.
6. Confirm who will reverse, settle, or refresh the estimate when actual documentation arrives.

Evaluate cutoff, estimate, and materiality

For each candidate, distinguish the service or delivery date from invoice date, payment date, and ledger posting date. Determine what evidence supports receipt or use during the period, whether the amount can be reasonably estimated under the entity’s process, and whether the item is significant enough to require action under policy. Avoid using a later invoice date alone to push an earlier-period cost forward, but do not accrue a proposal or future service solely because it has been approved. The responsible accountant should confirm treatment against the applicable accounting framework and company policy.

Worked example: service completed before the invoice arrives

A team holds a work event on September 28. The venue’s $2,400 invoice arrives October 6, and the signed service order plus event confirmation show the service was completed in September. The close reviewer checks whether the invoice is already recorded, confirms the final amount and appropriate account with the owner, and documents why the cost belongs in the September review population. If the amount is supported and accrual is appropriate under policy, accounting records the September treatment and creates a clear link for matching the October invoice. If the invoice amount differs, the reviewer investigates the variance; they do not post the full October invoice as a second expense.

Keep estimates from becoming duplicates

Give each accrual a unique reference, source, period, estimate method, and planned reversal or settlement check. At the next close, compare the actual invoice or expense submission with the estimate. Follow the organization’s process to reverse or adjust the estimate, then record the actual without duplicating the cost. If the actual never arrives, revisit the basis and status with the owner rather than carrying a stale estimate forward indefinitely.

Document unresolved items clearly

A missing invoice, uncertain service date, disputed amount, or incomplete employee report should remain a visible exception with an owner and follow-up date. Maintain support for both the decision to accrue and the decision not to accrue when a reviewer concludes evidence is insufficient. A checklist supports a repeatable close, but it cannot replace the accountant’s judgment about recognition, estimation, materiality, or the organization’s reporting requirements.