Part of the Financial consolidation series.
The group month-end close process is a sequence of dependent stages - cut-off and subledger closure at entity level, entity submission to group, intercompany matching and validation, consolidation and elimination, group adjustments, review and sign-off, and finally reporting and distribution. Each stage has a specific entry condition: a clear set of things that must be true before the next stage can safely begin. Most closes that run long do so because at least one stage started before its predecessor finished.
What does the group close process actually look like in sequence?
The process runs in seven stages, and the order is fixed by logic, not convention. Compressing the calendar by running stages in parallel is possible in limited ways, but only where the stages genuinely do not depend on each other. Skipping the entry condition for any stage creates rework downstream - and rework almost always costs more time than the overlap saved.
Stage 1: Cut-off and subledger closure at entity level
Entity-level cut-off is complete when every transaction belonging to the period is recorded and every transaction that does not belong is excluded. Before this is true, no submission figure is reliable. In practice this means: accounts payable and receivable cut-off confirmed, purchase orders and goods-received-not-invoiced accruals posted, payroll finalised, bank feeds reconciled to the ledger, and fixed-asset additions and disposals posted. The subledger - purchasing, sales, fixed assets, payroll - must be closed and agreed to the general ledger control accounts before the general ledger closes. Groups that allow entity general ledger close to precede subledger reconciliation routinely find differences arriving at group after the consolidation has started.
Stage 2: Entity submission to group
An entity submission is valid when the entity finance controller has confirmed that the figures are complete, cut-off is clean, and the trial balance has been reviewed against the prior period and budget. The entry condition for group is a signed-off, formatted submission - not a draft or a work-in-progress file. Groups that accept submissions on a rolling basis as entities finish, rather than holding a hard submission deadline, tend to lose a half-day or more reconciling different-vintage files. The slowest entity sets the pace for the intercompany matching stage, which cannot start meaningfully until all counterparties to a transaction have submitted. That single dependency - waiting on the slowest entity - is the first of the three places groups consistently lose days.
Stage 3: Validation and intercompany matching
Intercompany matching is the stage that most reliably separates groups that close in five days from those that close in ten. The entry condition is that all entities have submitted, because an intercompany balance only matches when both sides are in the room. The work is: agree intercompany receivables to intercompany payables by counterparty pair, agree intercompany revenue to intercompany cost of sales, and confirm that intercompany dividends, loans, and interest are symmetrical. Differences found at group level at this stage are the second of the three places groups lose days - and they are almost always avoidable. The same matching exercise, run at entity level before submission, using a shared intercompany schedule rather than each entity's own version, surfaces the differences while both controllers are still in their periods and can correct them. Groups that do intercompany matching at source, rather than at consolidation, typically reduce the time spent on this stage by a meaningful margin.
Stage 4: Consolidation and elimination
Consolidation begins when intercompany matching is closed - all differences resolved or formally agreed and deferred. The consolidation work itself is: load trial balances into the consolidation tool, apply currency translation at the correct rates, post intercompany eliminations (trading balances, unrealised profit in stock, intercompany dividends), eliminate investment in subsidiaries against subsidiary equity, and calculate minority interests. This stage is largely mechanical if the entry conditions have been met. The risk here is currency rates: groups that do not publish and lock a single set of closing and average rates before entity submission create mismatches between entity submissions and group consolidation that require manual correction at this stage.
Stage 5: Group adjustments and top-side journals
Top-side journals and group adjustments are entries that can only be made at group level - acquisition accounting, group tax provisions, central cost allocations, and any restatement of entity figures for group policy differences. The entry condition is a clean consolidated trial balance from Stage 4. These entries should be documented, approved in advance, and limited in number. A long list of top-side journals at this stage is a signal that group accounting policy is not being applied consistently at entity level - a process problem, not a journal problem.
Stage 6: Review and sign-off
Review is the third of the three places groups lose days, and the mechanism is specific: review comments that arrive after the pack has been built require rebuilding the pack. The fix is to structure review in two passes. The first pass is analytical - the group FC or Head of Reporting reviews the consolidated numbers against prior period, budget, and forecast before the pack is formatted, and raises queries while there is still time to investigate and restate. The second pass is a sign-off review of the formatted pack itself. Distributing a draft pack to reviewers and then waiting for comments is a process design choice that adds days; it is worth examining explicitly.
Stage 7: Reporting and distribution
The reporting pack is complete when it has been signed off by the group FC and, where required, the CFO. Distribution to the board or executive committee follows. Any supplementary reporting - statutory filing extracts, bank covenant certificates, management information for business unit heads - should be prepared from the same agreed data set used in the main pack, not re-extracted from the ledger. Re-extraction at this stage reintroduces the risk of version differences.
What does a group close checklist look like - and what is it for?
A checklist is a control, not a plan. It confirms that the entry conditions for each stage have been met before the stage is declared open. It does not tell the team how to do the work; it prevents the team from believing the work is done when it is not. The following checklist can be lifted and adapted.
| Stage | Entry condition checklist item | Owner |
|---|---|---|
| Cut-off and subledger close | Subledger agrees to GL control accounts | Entity FC |
| Cut-off and subledger close | GRNI accruals posted and reviewed | Entity FC |
| Cut-off and subledger close | Payroll finalised and posted | Entity FC |
| Cut-off and subledger close | Bank reconciliation complete | Entity FC |
| Entity submission | Trial balance reviewed vs prior period and budget | Entity FC |
| Entity submission | Intercompany schedule completed at entity level | Entity FC |
| Entity submission | Submission confirmed in the group timetable | Entity FC |
| Intercompany matching | All entities submitted | Group reporting |
| Intercompany matching | All counterparty pairs agreed or differences documented | Group reporting |
| Consolidation | Currency rates published and locked | Group reporting |
| Consolidation | All eliminations posted and agreed | Group reporting |
| Group adjustments | All top-side journals pre-approved | Group FC |
| Review - first pass | Analytical review complete before pack build | Group FC |
| Sign-off | CFO sign-off confirmed | CFO |
| Distribution | Pack version confirmed as signed-off version | Group reporting |
For benchmarks on how many days each stage should take, and where your close sits relative to peer groups, see our group month-end close benchmark article. This article covers the process; that one covers the numbers.
Common questions
What is the group month-end close process?
The group month-end close process is a sequence of seven dependent stages: cut-off and subledger closure at entity level, entity submission to group, intercompany matching and validation, consolidation and elimination, group adjustments and top-side journals, review and sign-off, and reporting and distribution. Each stage has a defined entry condition - a set of things that must be confirmed complete before the next stage begins. The close runs long when any stage starts before its predecessor has genuinely finished.
Why do group month-end closes run over schedule?
Most group closes that run long lose time in three specific places: waiting on the slowest entity to submit, discovering intercompany differences at group level rather than at entity level before submission, and receiving review comments after the reporting pack has already been built. Each of these is a process design problem with a specific remedy, not a general capacity problem.
When should intercompany matching happen in the close process?
Intercompany matching should happen at entity level before submission to group, using a shared intercompany schedule rather than each entity's own records. Matching at group level after all entities have submitted is the conventional approach, but it surfaces differences when both controllers are no longer actively in their periods, making resolution slower. Moving matching upstream - to the entity stage - is one of the highest-return process changes available to a group reporting team.
What is a month-end close checklist and what is it for?
A month-end close checklist is a control document that confirms the entry conditions for each stage have been met before the stage is declared open. It prevents a team from treating a stage as complete when work is still outstanding. It does not describe how to do the work; that sits in process documentation and training. A checklist used as a substitute for a plan will not shorten the close.
What entry condition must be met before group consolidation can begin?
Group consolidation can begin only when intercompany matching is closed - meaning all intercompany differences have been resolved, or have been formally agreed and documented as items to be carried forward. Starting the consolidation run while intercompany differences remain open means eliminations will be posted on incorrect figures, and the consolidated trial balance will need to be rebuilt once the differences are cleared.