Review Monthly Reports Before Approving Them
Before approving monthly reports, check the period, accounting basis and completeness of the underlying records. Then review material changes and unusual balances. Approval should mean you understand the reports and know which items, if any, remain unresolved, rather than simply accepting a set of totals.
Confirm what the reports include
Check the business name, dates and whether reports are cash or accrual based. Ask whether all agreed bank, card and payment accounts are included and reconciled. An omitted account or incomplete feed can change the picture substantially. Confirm that the reports are the latest version if corrections were made after the first draft.
Compare results with what happened in the business
Look at large sales changes, unusual expenses and payments you expected to see. Drill into unfamiliar categories instead of approving an unexplained total. Compare like periods, remembering that a seasonal project or annual insurance bill may create a valid difference. Ask for the supporting detail when the report does not match your understanding of operations.
Review obligations and outstanding decisions
Check overdue invoices, unpaid bills, card debt and loans where relevant. Ask whether any balances are estimates or depend on information still missing. Confirm owner transactions and significant purchases with the person responsible for their treatment. Keep a short record of the questions resolved and anything still pending. This creates a useful review history and helps keep later changes to a completed month understandable.