Closing the year for a group of companies: a December checklist
A checklist for groups with a 31 December year end reporting under IFRS: what to agree in early December, what each company does in January, and the group steps in order.
In this post 8 sections
In short
Close the year in three passes: before 31 December, agree policies, rates, cut-offs and confirmations; in early January, finish each company, then agree intercompany at zero tolerance; then translate, eliminate, test goodwill, check dividends and non-controlling interest, review and lock. Year-end adds tests a normal month skips.
Key takeaways
- Start in the first week of December, not on 2 January. Rates, cut-offs and confirmations are agreed while people are still in the office.
- Three passes: before year-end, company close, then group consolidation.
- Intercompany must agree to zero. The tolerance you allow in the year is not allowed at year-end.
- Lock only after review, and file the working papers for the auditor with the month.
When should year-end close work start?
In the first week of December. A group with a 31 December year end loses most of its time to things that could have been agreed earlier: which rate source, which cut-off, which companies owe which. Holiday cover in the last two weeks of the month also means fewer people to ask on 2 January.
The list below is for a group reporting under IFRS. Where US GAAP is the framework, the steps are the same in shape and the standards differ (ASC 810 for consolidation, ASC 830 for foreign currency). The group’s own policies decide the rest.
What should be agreed before 31 December?
- Policies. Consolidated accounts use uniform accounting policies1. Confirm every company follows the group policy, and list the differences you will adjust for.
- Reporting dates. Every company’s year end should be 31 December. If one differs, the standard allows a gap of no more than three months only with adjustments1, so plan the adjustments now.
- Rates. Fix the source for the closing rate on 31 December and for the year’s average, and say who publishes them. Balance sheets are translated at the closing rate and income at the rates on the transaction dates, for which an average is often used2.
- Cut-off. Set the last day for intercompany invoices and payments, and the day each company’s books are final.
- Confirmations. Ask each company to confirm its intercompany balances, loans and dividends by counterparty and currency, before the year closes.
- Ownership. Check the percentage held in every company and any change during the year.
Free: Year-end group checklist
This free Excel checklist sets out the tasks for closing a group of companies at a 31 December year-end under IFRS, from six weeks before to eight weeks after. Each task has an owner, a company, the evidence to keep and a due date that follows the year-end date you enter. A progress sheet shows the percentage done by week and by owner.
- Forty-six tasks from six weeks before the year-end to eight weeks after it.
- Due dates worked out from the year-end date, moved back to the last working day.
What should each company do in early January?
- Post the year-end accruals, prepayments, depreciation and tax.
- Revalue foreign currency balances at the 31 December rate in the company’s own books.
- Reconcile bank, receivables and payables, and clear suspense accounts.
- Record events after the year-end that give evidence of conditions at 31 December. Events that do not are disclosed, not adjusted3.
- Send the final trial balance for the full year, with the opening balance equal to last year’s audited closing balance.
- Lock the company’s year once the group has accepted its trial balance.
The Zoho Books locking page says transactions recorded before the lock date cannot be modified or deleted, so set the date to 1 January and check that an entry dated 31 December is blocked4. Checked against Zoho’s help centre on 29 Oct 2026.
What does the group do after the company books are final?
The group steps run in a fixed order. Each step ends with a check before the next one starts.
- Check each trial balance: debits equal credits, opening equals last year’s closing, and every account is mapped to the group chartGroup chart of accountsOne list of accounts that every company's own accounts are mapped to, so that figures from different companies and systems add up line by line.Open the glossary entry.
- Translate: income and expenses at the average rate, assets and liabilities at the closing rate, with the difference in the translation reserveTranslation reserveThe part of group equity that holds exchange differences from translating a foreign subsidiary into the group's currency.Open the glossary entry2.
- Agree intercompany to zero: eliminate balances, sales, dividends and loans1, and clear every difference with an owner. See the intercompany routine.
- Dividends and non-controlling interest: see Exhibit 1.
- Goodwill: test for impairment at least once a year5 and record the result.
- Related parties: prepare the disclosure for transactions with owners, directors and associates6. Intragroup items are eliminated and do not appear in the group’s own note.
- Review and lock: a second reviewer signs, the month is locked and the working papers are filed for the auditor.
How does a dividend and the non-controlling interest work out?
Kestrelwick, 80% owned, declares a dividend of 150,000 in pounds. Zenvara receives 80% of it and records dividend income. In the group accounts that income is eliminated against the dividend declared, because it moves between group companies. The other 20% goes to the outside owners and reduces the non-controlling interestNon-controlling interestThe share of a subsidiary's equity and profit that belongs to owners outside the group.Open the glossary entry. Both sides must agree to the dividend declared.
| Dividend declared by Kestrelwick | 150,000 |
| Received by Zenvara (80%)Eliminated against Zenvara’s dividend income | 120,000 |
| Paid to non-controlling interest (20%)Reduces non-controlling interest in equity | 30,000 |
| Total dividend accounted for | 150,000 |
Example group used across Finconsol guides. The dividend is an illustrative figure.
Check that 120,000 plus 30,000 equals the 150,000 declared. If it does not, the ownership percentage or the declared amount in one set of books is wrong.
What should be filed before the year is locked?
- The final trial balance of every company and the mapping used.
- The rate table, with source and date.
- Every elimination journal, with the confirmed balances and the rates behind it.
- The intercompany confirmation by pair, with the open-difference list (should be empty).
- The goodwill impairment test and the dividend check.
- Last year’s closing balances against this year’s opening balances, by company.
- The review checklist, signed and dated.
A monthly close checklist covers the regular steps; the five-day group close gives the order. Year-end adds the items above.
How does Finconsol handle this?
The year-end close uses the same controls as any month. Finconsol holds one rate table for the group, maps each company once, compares intercompany pair by pair every month and works out minority interest from the ownership percentages. The close screen lists what stops the month, and when nothing is left it shows the button that locks it. A locked month cannot be changed, and closes, locks, mappings and settings are recorded in the change log. Companies on Zoho Books connect directly (read only, nightly); others come in by trial balance. Goodwill tests, dividend checks and disclosures stay with your team.
| Company | Source | Trial balance | Accounts | Intercompany |
|---|---|---|---|---|
| Zenvara | Zoho Books | In | All mapped | Cleared |
| Fernhollow | Trial balance upload | In | All mapped | Cleared |
| Palmridge | Trial balance upload | In | All mapped | Cleared |
| Kestrelwick | Trial balance upload | In | All mapped | Cleared |
| Quillfern | Zoho Books | In | All mapped | Cleared |
Questions
When should a group with a 31 December year end start its close?
In the first week of December, with an agreed calendar. The decisions that take the longest, such as rate source, cut-off and ownership, are quick to make while people are still in the office.
Do subsidiaries need a 31 December year end?
The consolidated statements are prepared at one reporting date. If a subsidiary has a different year end, it must produce extra statements at the group date unless that is impracticable, in which case, within the limits of the standard, its figures are adjusted for significant events in the gap. Aligning year ends removes the work.
What tolerance for intercompany differences is acceptable at year-end?
None should remain unexplained. During the year a group may allow small differences with owners and dates. At year-end every difference should be cleared or understood, because the standard requires intragroup balances to be eliminated in full.
How is goodwill tested at year-end?
Goodwill is tested for impairment at least annually by comparing the carrying amount of the cash-generating unit it belongs to with its recoverable amount. The test uses the group’s own forecasts, so ask for them in the first week of December.
Sources
- IFRS 10 Consolidated Financial Statements, paragraphs B86(c), B92 and B93.
- IAS 21 The Effects of Changes in Foreign Exchange Rates, paragraphs 39 and 45.
- IAS 10 Events after the Reporting Period.
- Zoho Books help centre, Transaction locking. Checked against Zoho’s help centre on 29 Oct 2026.
- IAS 36 Impairment of Assets, paragraph 90.
- IAS 24 Related Party Disclosures.
Prabhu, A. (2026, 30 December). Closing the year for a group of companies: a December checklist. The Finconsol Blog. https://finconsol.com/blog/year-end-group-accounts-checklist/
Amit Prabhu leads Finconsol at Aaxonix Tech, a Zoho and NetSuite implementation partner based in Pune, India. He works with multi-company groups and the accountants who serve them on closing many sets of books into one set of group numbers.