Why Does Month-End Close Take So Long? Common Causes Explained

When finance teams are left waiting for data, moving it between systems manually, or chasing down approvals and revisiting matters that should already be settled, the month-end close can take longer than necessary. The solution for a manager looking to reduce month-end close time isn’t to put pressure on the team to work faster, but to identify where the process is being repeated or delayed.

It’s an issue you’ll find across many businesses. A poll of CA ANZ members conducted during a Phocas Software webinar, with results shared in May 2026, found that just 17% could complete their month-end close in under five days, while 70% took between five and 12 days and 13% took more than 12 days.

For the largest group of respondents, closing the books took five to 12 days each month. Reducing that time gives the team more opportunity to analyse the results and support business decisions.

Why Does the Month-End Close Take So Long?

The close is rarely a single task; it’s a sequence of dependent activities from gathering source data and posting transactions to reconciliations, accruals and the final review of balances. A delay in any one part can affect the rest of the schedule. A team may have the accounting side in order yet still lose days to an outstanding bank reconciliation or an intercompany confirmation. In many cases, what appears to be an accounting problem is really a workflow issue.

1. Source Data is Late

You can’t finish the close without the information to support it. An invoice from a supplier might come in after the period is done, or there could be timing issues in the bank feeds. Then there are expense claims and inventory numbers coming from other systems. The finance team is then left to estimate via an accrual, go ahead with what they have and come back to it later, or simply wait.

It’s an unnecessary dependency, and adding more staff won’t fix it if the data is consistently late. The ABS noted in 2024-25 that 59% of Australian businesses had supply-chain disruptions; while that’s about the wider business rather than reporting per se, it speaks to the kind of operational dependencies involved.

2. Task Ownership is Ambiguous

Managing the close is hard when no one is clearly responsible for a given step. A journal might remain unapproved because there’s no one to escalate to, or a reconciliation is handed off to “finance” in general. Another department might think it’s your job to provide something they should be supplying. These small issues add up.

A better approach is to have a workflow where every task has an owner and a deadline, with any dependencies clearly identified from the outset. If a payroll report is needed before a reconciliation can get under way, that should be known in advance. A central checklist makes it clear what’s done and where the process is delayed.

3. Reconciliations Done by Hand

This is where the close tends to become labour-intensive. Staff will pull figures from a ledger or payment platform and compare them manually in Excel, then document and correct any variances. The reconciliation isn’t the issue; it’s all the manual preparation around it.

According to Ledge’s 2025 benchmark of 100 finance professionals, cash reconciliation was the most time-consuming part of the close, while 50% of respondents cited managing the close in Excel as a key blocker to closing faster.

Given that the sample spans from 51-employee operations to those with in excess of 10,000 staff, it’s best viewed as an industry benchmark and not strictly an Australian statistic.

There’s room for financial close automation here. For instance, automated matching will identify transactions that agree and put any exceptions in front of someone for a closer look.

4. Old Unresolved Items

A lengthy close tends to be burdened by issues that should have been resolved earlier. An account might carry an unreconciled balance from last month simply because no one can say who’s responsible for it.

One may find a recurring suspense item being carried forward or an unexplained variance that has been quietly accepted as part of the monthly routine. The problem can compound; rather than resolving an issue early, the finance team is left to review months of transactions to get to the bottom of it.

A sensible control is to keep a register of unresolved items detailing the amount, owner, account and the date by which a resolution is expected, along with the reason and action needed. These shouldn’t be allowed to carry forward on the basis that the prior close is complete.

5. Single-Person Dependencies

It’s common for a finance team to be dependent on one individual for the preparation of a certain report or reconciliation. That person has the workbook they put together, knows the formulas and knows what manual adjustments are needed. If they aren’t around, the process can come to a halt.

While this is a staffing matter, it’s also one of process control. By standardising working papers and putting procedures in writing, the need to rely on one person’s knowledge is reduced, and any unnecessary manual steps in the process become apparent.

6. Spreadsheet-Heavy Reporting

While spreadsheets have their place in a close, they can cause problems when they’re the only thing linking multiple systems. A team might pull figures from the general ledger, put them in Excel, perform some calculations and reconcile another sheet before manually moving the end result into a management report. Each of those hand-offs creates an opportunity for error or delay.

The ABS has data showing Australian firms are increasingly turning to digital tools: 12% were using AI in 2024-25, up from the 1% recorded in 2021-22, and 46% could be described as innovation-active. Though these numbers don’t speak to financial close automation per se, they give some context to the wider trend.

How Can Finance Teams Reduce Month-End Close Time?

The solution is rarely to automate the whole close at once. Start by mapping the process from the last day of the month to sign-off, noting every system, dependency and manual hand-off to identify where the time is being spent.

Activities that are high-frequency and rules-based are good candidates for automation. Think bank matching, task reminders, approval routing and similar tasks. The aim is to remove repetition from preparation and make the status of the close visible, but leave the accounting judgement and anything unusual to the qualified staff.

What Does Better Month-End Close Workflow Improvement Look Like?

Speed isn’t just about reducing the number of days. You want reliable numbers and a transparent record of approvals. This requires standardised reconciliations, controlled adjustments and clear ownership of tasks so that source data is gathered earlier. Automation can then support that structure.

In the end, month-end close workflow improvement has to come from the process first. When finance managers can identify where the waiting and manual work is happening, they’ll be in a position to determine what needs better controls, what needs clear ownership and what can be automated.