Month-End Close: Five Questions Before You Trust the Profit
Understand why the unclosed profit is provisional and what makes a reviewed result credible.
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Accounting
One Month, Closed: Follow Every Adjustment
Reconcile every adjustment to the income statement, balance sheet, equity and cash flow.
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From Local Books to the Organization's Profit
Understand group eliminations, currency, tax and the different levels of profit.
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Balanced Books Can Still Be Wrong
Connect the ledger to banks, subledgers, schedules and evidence beyond the accounting system.
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The Numbers We Have to Estimate
Support credit losses and other estimates, and distinguish new information from errors.
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When Inventory and Equipment Become Expenses
Trace cost of sales, depreciation, inventory shortages and write-downs.
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Expense Now, or Asset First?
Distinguish spending from expense and identify the resource that qualifies to remain as an asset.
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The Cost Arrives Before the Invoice
Accrue completed work, reconcile the eventual invoice and avoid counting the same cost twice.
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Which Month Owns the Transaction?
Use promises, delivery and payment rights to separate this month from the next.
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Why Profit Changes Equity
Trace close adjustments into their supporting balances, then reconcile profit, equity and cash.
Read essayOne Mac mini, Five Sets of Books
One $1,299 Mac mini order creates five different accounting stories. Follow the journal entries, assets, liabilities and revenue clocks of the seller, lender, payment participants and carrier.
Read essayBeyond Accounting: Who Actually Profits from My Mac mini?
The entries balance, but who makes money? A reconciled model of one computer purchase explains the different profit margins, financing costs, risks and capital demands behind 0% APR.
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