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Month-end close for an Indian finance team is not a single task. It is four parallel reconciliation workstreams that must complete in sequence: bank reconciliation first, then TDS, then GST, then platform settlements. Each has different deadlines, different data sources, and different downstream effects on the month’s financial statements.
This checklist covers all four workstreams in the order they should be completed.
Pre-Close Preparation Steps
Preparation completed in the last week of the month reduces the close cycle from 5 days to 3.
By the 25th of the month:
- Download bank statements for all accounts — including intra-day for the 25th if possible
- Request TDS deduction details from accounts payable for the current month
- Download GSTR-2B as soon as available (generated on the 14th — use the prior month’s final version)
- Collect platform settlement files from all active gateways (Razorpay, PayU, Cashfree dashboards)
On the last working day of the month:
- Freeze the accounts payable ledger for the month
- Record all outstanding cheques issued but not presented
- Identify any expected credits (NACH batch, large NEFT) likely to arrive on month+1
Bank and Ledger Reconciliation Tasks
Step 1: Bank Statement vs Cash Book
| Task | Action | Expected outcome |
|---|---|---|
| Download final bank statement | MT940 format or CSV export | Month-end balance confirmed |
| Match debits to payments | Payment vouchers, RTGS/NEFT references | 95%+ auto-matched |
| Match credits to receipts | UTR reference or narration | Outstanding credits identified |
| Identify outstanding cheques | Cheques issued, not presented | Documented with date issued |
| Record bank charges | Service charges, GST on bank charges | Posted to correct ledger account |
| Confirm closing balance | Book balance + outstanding items = bank balance | Signed off by finance manager |
Bank reconciliation should complete within 2 working days of month-end. Unresolved items go to a suspense account with a 5-day resolution SLA.
TDS and GST Matching Procedures
TDS Receivable vs Form 26AS
For organisations receiving payments with TDS deductions (professional services, contracting, commission income), the TDS reconciliation runs as follows:
- Export TDS receivable ledger — all entries for the month by deductor TAN and section code
- Download updated Form 26AS from TRACES (allow 7-day lag from challan deposit date)
- Match entries by: deductor TAN + section code + quarter + amount
- Flag mismatches: wrong PAN, wrong section, amount difference above ₹100
- Contact flagged deductors with correction return request by the 10th of the following month
TDS entries for which Form 26AS credit is not visible by the 20th of the following month should be escalated — they may require a correction return before the quarter’s TDS return filing deadline.
GST ITC Reconciliation
GSTR-2B is generated on the 14th of each month for the prior month’s transactions. ITC matching against the purchase register must be complete before GSTR-3B filing (due 20th):
- Download GSTR-2B for the current filing period
- Compare each GSTR-2B entry to the purchase register — match by GSTIN, invoice number, and amount
- Invoices in purchase register not in GSTR-2B: flag as pending supplier filing — do not claim ITC
- Invoices in GSTR-2B not in purchase register: add to register, verify receipt
- Finalise ITC claim amount for GSTR-3B based on reconciled figure only
Platform Settlement Verification
Platform settlement reconciliation bridges revenue recognition and bank reconciliation. The steps are:
- Download settlement files for all gateways for the close period
- Match each settlement to revenue — verify that order amounts net of MDR match the settlement credit
- Identify GST on MDR — confirm deductibility and post to correct expense account
- Identify TCS deducted at 1% (for marketplace sellers) — match to GSTR-2B credit
- Match settlement credits to the corresponding bank account credits by UTR or settlement reference
In-transit settlements (orders settled after month-end) should be documented separately and matched in the following month’s bank reconciliation.
Escalation and Sign-Off Process
The month-end close is not complete until exceptions are classified and signed off — not merely identified.
Each exception should carry: exception type, amount, responsible party for resolution, resolution deadline, and materiality flag. Exceptions above a materiality threshold (typically ₹1 lakh for mid-size companies) require CFO review before close sign-off.
Using bank reconciliation software that automates the matching phase means the finance team’s close effort shifts from data manipulation to exception review — a fundamentally different and more valuable use of time.
Reconciliation software India that covers bank, TDS, GST, and platform settlements in a single exception queue can compress the entire close cycle. The ICAI publishes guidance on the close process and documentation standards for statutory audit purposes.