# Close Guide

## Before You Start

Before beginning any close, confirm the following:

* **Previous period is** [**locked**](/close-workflows/locks.md)**.** This prevents backdated entries from contaminating a period you've already closed. If you haven't locked the prior month yet, do that first.
* **All accounts are connected and syncing.** Check the Accounts tab for disconnection warnings. If an account dropped, [reconnect](/setting-up/integrations/manage-integrations.md) it or request statements from the client.
* **Prior period retained earnings agree with the last financial package.** If they don't, something was posted to a closed period — investigate before proceeding.
* **Client has been invited with** [**correct permissions**](/managing-clients/roles-and-permissions.md)**.** We recommend adding clients as Members so locked periods are view-only for them.

***

## Step 1: Confirm Transaction Completeness

Start with [reconciliation](/close-workflows/reconciliation.md) — not categorization. The goal is to answer one question: do we have every transaction the bank has?

In Kick, every transaction imported is immediately posted to the ledger — reconciliation here is about confirming completeness, not posting.

**What to do:**

* Navigate to Accounting → Reconciliation
* Upload statements for the period if they haven't synced automatically through [Plaid](/setting-up/integrations/connect-accounts.md)
* Follow the steps in the reconciliation article for each bank and credit card account
* Confirm opening and closing balances match the bank statements
* Resolve any exceptions (missing transactions, date discrepancies, duplicates)

**Why Kick does it this way:** Reconciling first ensures data completeness before you start reviewing or categorizing. This prevents the common problem of discovering missing transactions halfway through a close.

***

## Step 2: Review and Resolve Transfers

Before categorizing, check that [transfers](/bookkeeping-workflows/transfers.md) between accounts are properly matched. Unmatched or miscategorized transfers can show up as non-zero balances in your clearing accounts on the [Balance Sheet](/reports/balance-sheet.md).

**What to do:**

* Review the Balance Sheet for non-zero clearing account balances:
  * Bank Transfer Clearing
  * Payment Transfer Clearing
  * Credit Card Clearing
* [Match any unmatched transfers](/bookkeeping-workflows/transfers.md) manually, or investigate why they're unmatched (the other account may not be connected)
* For recurring transfers, set up a [Transfer Rule](/bookkeeping-workflows/rules.md) so Kick handles the matching automatically going forward

**Ideally, clearing accounts are at $0 after matching.** A non-zero balance is always worth investigating, but it's not always an error.

**Likely needs fixing:**

* A transaction has been **miscategorized** (e.g., a transfer coded as an expense)
* A transfer didn't clear because the **other account is disconnected or not yet connected** in Kick

**May be expected:**

* The offsetting transaction **clears after the period ends** — the balance will resolve in a future period, but confirm that's expected

***

## Step 3: Transaction Review

Kick's tiered [categorization](/bookkeeping-workflows/categorization.md) system auto-categorizes \~97% of transactions on first pass. Your job is to review the exceptions — the transactions where the AI wasn't confident enough to make a call.

**What to do:**

To review **similar transactions** →

1. Open the [Transactions](/bookkeeping-workflows/transactions.md) page, toggle to the General Ledger Review [View](/collaboration/views.md), filter for the period you are reviewing, sort Bank description alphabetically by clicking on the column header.
2. Select transactions (see [Keyboard shortcuts](/reference/keyboard-shortcuts.md)) to update [categorization](/bookkeeping-workflows/categorization.md), [counterparties](/bookkeeping-workflows/counterparties.md), [classes](/bookkeeping-workflows/classes.md), etc.
   1. Kick will ask you if you'd like to make changes to similar transactions. Click **Review** when you see this pop-up and **Assign** to confirm the bulk update. Kick will learn from these changes over time.
3. For recurring transactions, ensure your updates are always applied consistently by creating [Rules](/bookkeeping-workflows/rules.md).

To review **uncategorized transactions** →

1. Open the [Transactions](/bookkeeping-workflows/transactions.md) page, toggle to the General Ledger Review [View](/collaboration/views.md), filter for the period you are reviewing, filter for Category → Uncategorized.
2. Assign categories to transactions that do not need to be confirmed with your client.
3. If you need client input, generate a [Task](/close-workflows/tasks.md) from the transactions to request more info.

To review **material transactions** →

1. Open the [Transactions](/bookkeeping-workflows/transactions.md) page, toggle to the General Ledger Review [View](/collaboration/views.md), filter for the period you are reviewing, click the Amount column to sort largest cash in → largest cash out.
   1. Click Amount again to reverse the sorting.
2. Alternatively, use the Amount filter to review transactions above a materiality threshold.
3. Confirm categorization, taking particular care to review Contributions, Distributions, Transfers, and Revenue.

To review transactions **without a counterparty** →

1. Open the [Transactions](/bookkeeping-workflows/transactions.md) page, toggle to the General Ledger Review [View](/collaboration/views.md), filter for the period you are reviewing, filter for Counterparty → No counterparty.
   1. Add additional filters for scenarios where all transactions require a counterparty (e.g. General Ledger = Contract Labor).
2. Assign a [counterparty](/bookkeeping-workflows/counterparties.md) to each transaction, making bulk updates to selected transactions when possible.

To review **personal accounts** →

1. Open the [Transactions](/bookkeeping-workflows/transactions.md) page, toggle to the General Ledger Review [View](/collaboration/views.md), filter for the period you are reviewing, filter for Entity → Personal.
2. Move business transactions that occurred in personal accounts to the relevant entity, and assign the appropriate category.
   1. See [Personal to Business](/bookkeeping-workflows/personal-to-business.md) for additional guidance.

{% hint style="info" %}
**Key distinction:** In Kick, you work from the Transactions page — not the Profit & Loss. The Transactions page is your command center for categorization, rule creation, and bulk actions.
{% endhint %}

***

## Step 4: Payroll Reconciliation

If the client uses a payroll provider (Gusto, ADP, etc.), verify that payroll entries for the period are complete and match the provider's reports.

{% hint style="info" %}
**What to do when using Gusto**

Follow the [Payroll reconciliation guide](/close-workflows/payroll.md) to reconcile the Gusto payroll liability account, including net pay, taxes, benefits, and contractor payments.
{% endhint %}

**What to do:**

* Compare payroll-related transactions in Kick against the payroll provider's period summary
* Confirm wages, taxes, employer contributions, and other deductions are recorded correctly for each period
* Make adjusting [journal entries](/close-workflows/journal-entries.md), as needed
* For [Gusto-integrated](/setting-up/integrations/gusto.md) clients, Kick automatically maps standard payroll accounts — confirm the mapping is correct

This step is especially important at year-end when reconciling to the W-3, but a quick check each month prevents surprises. For recurring payroll adjustments, set them up as [recurring entries](/close-workflows/journal-entries/create-recurring-entries.md).

***

## Step 5: Loan Reconciliation

[Loans](/close-workflows/loans.md) are common enough to warrant their own review. If the client has any outstanding loans, lines of credit, or financing arrangements, reconcile them separately.

**What to do:**

* Verify loan balances in Kick against lender statements for the period
* Confirm principal and interest [splits](/bookkeeping-workflows/splits.md) are recorded correctly on each payment
* Check that loan amortization schedules are being followed — set up [recurring entries](/close-workflows/journal-entries/create-recurring-entries.md) for monthly interest accruals if needed
* For new loans originated during the period, confirm the proceeds and any associated fees are booked correctly
* Reconcile any line-of-credit draws and repayments

**Why this matters:** Loan balances directly affect the Balance Sheet. Catching discrepancies here prevents downstream issues when reviewing the full Balance Sheet.

***

## Step 6: Post Adjusting Journal Entries

After the categorization review and Balance Sheet review are complete, post any period-end adjustments.

**Common adjustments:**

* Loan interest accruals
* Prepaid expense amortization
* Depreciation or amortization
* Deferred revenue recognition
* Receivable write-offs
* Reclassifications

For entries that repeat each period (depreciation, amortization), set them up as [recurring entries](/close-workflows/journal-entries/create-recurring-entries.md) so they post automatically. See [Journal entries](/close-workflows/journal-entries.md) for full details on creating and managing JEs.

***

## Step 7: Financial Statement Review

**What to do:**

* Navigate to Accounting → Balance Sheet
* Confirm prior period retained earnings agree with what was reported in the last financial package. If they don't, something was posted to a closed period — investigate before proceeding
* Scan for stale balances: prepaid amounts that should have been amortized, receivables that should have been written off, clearing accounts that should be at zero

**Note:** Kick's [Balance Sheet](/reports/balance-sheet.md) includes [clearing accounts](/bookkeeping-workflows/transfers.md) (Bank Transfer Clearing, Payment Transfer Clearing, Credit Card Clearing). These should be at $0 after completing Step 2. A remaining balance isn't necessarily an error — it may indicate a transfer that clears in a future period, or an account that hasn't been connected yet. If a balance remains, make sure you can explain it before moving on. See Step 2 for the full diagnostic checklist.

{% hint style="info" %}
**Double-Check**

At this point, the close is substantively done. But you're a meticulous accountant — so you're going to check it over one more time.

**What to do:**

* Review the [Profit & Loss](/reports/profit-and-loss.md) for the period — do revenue, expenses, and net income pass the smell test?
* Review the Balance Sheet one more time — any stale items that require adjustment?
* Check that clearing accounts are still at $0 (nothing snuck in during the adjustment phase)
* If the client uses [classes](/bookkeeping-workflows/classes.md), run the P\&L by class to confirm nothing is misallocated
* Export the [Balance Sheet](/reports/balance-sheet.md) or [Profit & Loss](/reports/profit-and-loss.md) if you need to review offline or share with a third party before locking
  {% endhint %}

***

## Step 8: Lock the Period

**What to do:**

* Navigate to your profile icon → [Locks](/close-workflows/locks.md)
* Select the month and click Lock
* Locking a month also locks all prior months

Once locked, clients with Member permissions have view-only access to the period. Only firm team members and client Admins can unlock.

***

## Step 9: Share with Client

Deliver the financial package to the client.

**What to do:**

* Create a [Task](/collaboration/tasks.md) with the period's financials attached (P\&L, Balance Sheet, and any notes). You can export financials in multiple formats directly from the [Balance Sheet](/reports/balance-sheet.md) and [Profit & Loss](/reports/profit-and-loss.md) report pages.
  * Alternatively, invite your client as a Member so they have view-only access to the Accounting tab for locked periods. Using a Task, instruct them to navigate to each report and filter for the closed period to complete their review.
* For year-end, the Year-End [Tax Package](/reports/tax-package.md) can be downloaded from the Accounting page to bundle all financials into a single download.


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