Debugging a Broken Month-End Close: Common Issues and Troubleshooting Steps

It is March 31, 11 PM. Your balance sheet does not balance. Or your prepayment reconciliation is off by £2,500. Or you cannot find the supporting entry. You have hours to go before the CFO reviews the close. Here is a troubleshooting flowchart.

Issue #1: Balance Sheet Does Not Balance (Debits ≠ Credits)

Likely Causes

• Manual journal entry was only posted to one side (forget the credit)
• A transaction was reversed but the reversal was incomplete
• A prepayment or accrual was posted but not linked correctly
• A formula error in a consolidation or adjustment spreadsheet

Troubleshooting Steps

• 1. Export the trial balance and manually re-add. If it balances, the GL is OK (the issue is in your reporting layer).
• 2. Check for unbalanced manual journal entries — search for entries posted today/this week.
• 3. Verify that all reversals were posted in pairs (debit/credit on both sides).
• 4. If you use a consolidation or adjustment layer, recalculate from scratch and compare.

Issue #2: Prepayment Reconciliation Does Not Match GL

Likely Causes

• A prepayment was added to the schedule but the journal entry was not posted
• A prepayment was removed from the schedule but the GL still shows the balance
• Amortization was posted to the wrong GL account
• A refund or adjustment was posted to the GL but not reflected in the schedule

Troubleshooting Steps

• 1. Run a GL detail report for the prepaid asset account — list every entry for the month.
• 2. Match each GL entry to a line in your prepayment schedule. If an entry has no match, investigate.
• 3. Recalculate the total of all prepayment schedules and compare to the GL balance. Document the difference.
• 4. If the difference is small (< £100), it might be a rounding issue. If it is large, you have a missing transaction.

Issue #3: Accrual Reversal Did Not Post (Double-Counting)

You accrue for bonuses on Jan 31, post the reversals on Feb 1, but the P&L shows both. The accrual is still there after the actual posted.

Troubleshooting Steps

• 1. Check your accrual reversal log — is the entry documented?
• 2. Search the GL for "REVERSAL" or "RV" entries dated Feb 1.
• 3. If the reversal entry does not exist, create it now and re-run the P&L.
• 4. If the reversal entry exists but the accrual is still posting, check the dates — is the reversal dated correctly?

Prevention Is Better Than Debugging

Use a checklist and a validation step before you sign off. Reconcile supporting schedules to the GL. Have a second person review. These steps catch 80% of issues before you hit the 11 PM crisis.