Month-end close Updated November 2026

Fixed asset reconciliation

Roll the fixed asset register forward each month: opening cost + additions - disposals = closing cost, and opening accumulated depreciation + depreciation - depreciation on disposals = closing. Both closing figures must equal the general ledger; differences usually come from additions or disposals posted on one side only.

Syntax

Closing cost = Opening cost + Additions - Disposals; Closing acc. dep. = Opening acc. dep. + Depreciation - Acc. dep. on disposals; both = GL

Part	What it is
`Fixed asset register`	Subledger listing each asset, cost, date, method, life and accumulated depreciation
`Additions`	Capitalized purchases; must appear in both register and GL
`Disposals`	Remove cost and accumulated depreciation; record gain or loss
`Depreciation`	Monthly entry from the register: Dr Depreciation Expense / Cr Accumulated Depreciation

Examples

Opening cost 120,000; additions 15,000; disposals 10,000

Result: Closing cost 125,000. GL Fixed Assets at cost must show 125,000.

Opening acc. dep. 48,000; monthly depreciation 2,100; acc. dep. on the disposed asset 8,000

Result: Closing acc. dep. 42,100. Net book value = 125,000 - 42,100 = 82,900.

Asset with cost 10,000 and acc. dep. 8,000 sold for 2,500

Result: Dr Cash 2,500 / Dr Accumulated Depreciation 8,000 / Cr Fixed Assets 10,000 / Cr Gain on Disposal 500.

GL cost 127,000 vs register 125,000

Result: Difference 2,000: a repair invoice was capitalized in the GL but is not an asset. Reclassify: Dr Repairs Expense 2,000 / Cr Fixed Assets 2,000.

Common mistakes

Capitalizing repairs and maintenance: only costs that extend life or capacity are assets.
Depreciating from the invoice date rather than the in-service date: policy should say which, and the register should follow it.
Leaving disposed or scrapped assets on the register: cost and accumulated depreciation are both overstated.

Practice Fixed asset reconciliation

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

Bakery year-endClassify 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

How often should fixed assets be reconciled?

The roll-forward monthly if there are additions or disposals, and at least quarterly otherwise. A physical count or verification is done annually.

What is the entry for monthly depreciation?

Dr Depreciation Expense / Cr Accumulated Depreciation for the total from the register, split by asset class if the ledger has separate accounts.

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.
Month-end close checklistA month-end close checklist in sequence: cutoff, bank and card reconciliations, AR and AP, accruals and prepaids, fixed assets, balance sheet recs, lock.
Year-end closeThe year-end close adds closing entries and annual tasks to the usual month-end: reconcile every balance sheet account, finalize adjustments, close to equity.