Month-end close Updated November 2026

Accounts payable reconciliation

Agree the AP aging total to the Accounts Payable balance in the general ledger, then reconcile key vendor statements to the vendor balances in your ledger. Differences are usually invoices received but not yet entered, payments sent but not yet received by the vendor, or credits one side has not recorded.

Syntax

GL Accounts Payable = AP aging total; Vendor statement balance = Ledger vendor balance + Invoices not yet entered - Payments in transit +/- Credits

Part	What it is
`AP aging`	Open vendor invoices by age; the subledger
`Vendor statement`	The supplier's list of what they think you owe
`Invoices not entered`	On the vendor statement, not in your ledger; accrue or enter them
`Payments in transit`	In your ledger, not yet on the vendor statement

Examples

Vendor statement 5,400
Ledger balance for the vendor 4,100
Invoice #9981 for 1,500 dated the 29th not yet entered; check for 200 mailed on the 30th not yet received

Result: 4,100 + 1,500 - 200 = 5,400. Enter the invoice; the check clears next month.

GL Accounts Payable 22,750; AP aging 22,750

Result: Control account agrees with the subledger; no reconciling items.

GL 22,750; aging 21,950; a manual accrual of 800 posted to the AP control account

Result: Move the 800 to Accrued Liabilities so the control account equals the aging.

Common mistakes

Posting accruals to the AP control account: use Accrued Liabilities so AP stays equal to the aging.
Paying from a vendor statement without matching invoices: duplicate payments follow.
Ignoring debit balances in AP: they are prepayments or overpayments and belong in assets.

Practice Accounts payable reconciliation

These drills check your answer on live data, free, no account needed.

Rental company closeClassify every line, enter both adjusted balances, then choose the journal entry the company must record for each item that affects its books.
The full workoutClassify every line, enter both adjusted balances, then choose the journal entry the company must record for each item that affects its books.

Questions

Why reconcile vendor statements if the aging matches the GL?

The aging only shows what you entered. A vendor statement reveals invoices you never received or entered, which matters for cutoff and accruals.

How often should AP be reconciled?

The aging to GL every month-end; vendor statements monthly for major suppliers and at least quarterly for the rest.

Accounts receivable reconciliationReconcile accounts receivable by agreeing the general ledger control account to the customer aging, then explaining any difference: unapplied cash, journals.
Accruals at month-endHow to accrue expenses incurred but not yet billed and revenue earned but not yet invoiced at month-end, with worked entries and the reversal next month.
CutoffCutoff means every transaction is recorded in the period it belongs to: sales when goods ship, purchases when received. How to test cutoff and fix an error.
Balance sheet reconciliationA balance sheet reconciliation supports each ledger balance with independent evidence: a bank statement, an aging, a schedule or a roll-forward. Sign-off.