Year-End Book Finalisation Checklist for Companies, LLPs and Proprietors

Book finalisation is the work of closing the year's accounts so that the trial balance is complete, reconciled and ready for the financial statements and the audit. Done well, it shortens the audit, avoids last-minute adjustments and keeps your GST and income-tax figures consistent. This checklist is the one our team works through for clients at 31 March; use it whether you close the books yourself or hand them over.

The checklist

1. Cash and bank

• Reconcile every bank account to the statement as on 31 March, and list uncleared cheques and deposits.
• Obtain balance confirmations for loans and fixed deposits, with interest accrued to the year end.
• Count physical cash, or confirm the cash book balance is realistic.

2. Customers and suppliers

• Age receivables and payables, and investigate old and credit balances.
• Send balance confirmations to major parties.
• Provide for doubtful debts in line with your policy.
• Check payments to MSME suppliers against the 45-day rule; see Section 43B(h).

3. GST

• Reconcile output tax in the books with GSTR-1 and GSTR-3B for the year.
• Reconcile input tax credit in the books with GSTR-2B and the IMS actions taken.
• Reverse blocked and ineligible credits, and credit unpaid to suppliers beyond 180 days.
• Note credit notes and missed invoices that must be reported by 30 November.

4. TDS and income tax

• Match TDS deducted in the books with the TDS returns and challans.
• Match TDS deducted from you with your annual tax statement (Form 26AS / AIS).
• Record advance tax paid and the provision for tax.

5. Stock

• Count stock at the year end, or roll forward from a recent count, and reconcile to the books.
• Value it at the lower of cost and net realisable value, and identify slow-moving and obsolete items.
• For companies covered by CARO, keep the verification record for the auditor; see stock audit vs physical verification.

6. Fixed assets

• Update the fixed asset register for additions, sales and write-offs.
• Calculate depreciation under the Companies Act (or the books policy) and, separately, under income-tax rules.
• Check that capital and revenue items are correctly classified.

7. Accruals, prepayments and cut-off

• Accrue expenses incurred but not invoiced: rent, utilities, professional fees, salaries and bonus.
• Defer prepaid expenses and income received in advance.
• Check that sales and purchases around 31 March are in the right year.

8. Payroll and statutory dues

• Reconcile salary, PF, ESI and professional tax with the returns and challans.
• Provide for gratuity and leave encashment where your policy or the law requires.

9. Equity, loans and related parties

• Match share capital, directors' or partners' accounts and loans to the statutory records and agreements.
• List related-party transactions and balances for disclosure.

10. Software and records

• For companies, confirm the accounting software's audit trail (edit log) was enabled throughout the year; the auditor reports on it.
• Lock the period once finalised, and take a backup.
• Prepare the trial balance with schedules for each material balance.

Timeline for a March year end

Frequently asked questions