Month-end Reporting Best Practices

Contents

• Overview
• Close a Financial Period
• Reporting
  • Accounts Receivable Reconciliation
  • Deferred Revenue Waterfall 
  • General Ledger Account Balance Reconciliation
  • Cash Reconciliation
  • Reconciling Tax between Ordway (Sales Tax Report) and Avalara
  • MRR Reconciliation (Ordway to External System) 

Overview

The Month-End Reporting and Financial Period Close Best Practices guide provides a recommended workflow for validating financial data and reconciling key balances before closing a financial period.

Following these best practices helps identify and resolve variances before closing the accounting period in your General Ledger (GL) and the corresponding financial period in Ordway.

Month-End Close Process

Use the following workflow to complete your month-end close:

1. Generate journal entries (if required).
2. Review and reconcile Accounts Receivable.
3. Review the Deferred Revenue Waterfall.
4. Verify General Ledger account balances.
5. Perform Cash Reconciliation.
6. Review Sales Tax reconciliation.
7. Perform MRR reconciliation (optional validation).
8. Close the financial period in Ordway after completing all reconciliations.

Close a Financial Period

Important: After closing the accounting period in your General Ledger (GL), close the corresponding financial period in Ordway to prevent additional transactions from being posted to the closed period.

Month-end Close Process

Note: If journal entry generation is configured to run automatically under Setup > Finance, skip Step 1.

1. Generate a Journal Entry Run (JER) for the reporting period using Journal Entry Date = Transaction Date for all transaction types. Refer to Add a Journal Entry Run (JER) 
   

2. Navigate to Finance > Financial Periods, review the Summary Balances, ensure Unposted transactions do not exist. 
   Unposted transactions and their corresponding accounting impact on Revenue, Accounts Receivable, Cash, and other accounts are not recognized until they are posted.

   Note: Ordway displays a warning if you attempt to close a financial period that contains unposted transactions.

3. Review the Summary Entries. Journal entries are summarized by transaction type (for example, Invoices, Payments, and Revenue Schedules).
4. Download the Journal Entry Export to use as supporting documentation during reconciliation. It can also serve as a backup of financial records.

5. After completing your review, select More > Close and confirm the warning message. 
   Note: Closing a financial period closes all previous periods. Opening a financial period opens all future periods.
   

   Best Practice: Close the financial period in Ordway after the corresponding accounting period has been closed in your General Ledger (GL).

Reporting

Accounts Receivable Reconciliation

Objective

Compare the ending Accounts Receivable balance with the Accounts Receivable Aging Report to verify invoice, payment, credit, and reversal activity.

Filter - Only use the date filter. 

Important! The AR Aging Report uses invoice balance history. The audit log alone may not identify all reconciliation differences.

High-Level Validation

1. Run the Account Balance (Cumulative) report. See Account Balance (Cumulative) Report for more details
2. Run the Accounts Receivable Aging report using the last day of the month as the target date. See Aging Report 
3. Compare the ending Accounts Receivable balance with the Total Outstanding balance.

Steps

1. Run the Account Balance (Cumulative) Report, and drill-down on the Accounts Receivable for the month.
   
2. Export the detailed report.
3. This output can be opened in Excel and will show all the transactions that had financial/accounting impact on A/R. It is important to filter the date range for ONLY the current month (assuming the prior month ending balance has already been reconciled, which validates the beginning balance of this month).
4. Compare the results with the Accounts Receivable Aging export.

Deferred Revenue Waterfall 

The Deferred Revenue Waterfall report displays deferred revenue balances at the end of the selected reporting period and forecasts expected changes based on the latest Billing Schedules and Revenue Schedules.

Steps

1. Run the Deferred Revenue Waterfall report. 
2. Set the report filter to As of Specific Day. 
3. Select the last day of the financial period being closed. 
4. Review customers with variances. I
5. Investigate any variances before closing the financial period.

For additional information, see the, Deferred Revenue Waterfall Report. 

General Ledger Account Balance Reconciliation

Verify that the following account balances in Ordway match the balances in your General Ledger (GL):

• Accounts Receivable
• Deferred Revenue
• Revenue
• Cash
• Payment Processing Fees
• Bad Debt

Investigate and resolve any variances before closing the financial period.

Cash Reconciliation

Steps

1. Export Ordway Payments (Navigate to Menu > Operations > Payments > Export Payments). 
2. Download Stripe Payments directly from your Stripe account.
3. Compare in bulk and if mismatch, use Payment Runs to determine which records are causing a variance.

Note: Be mindful of any refunds since the Stripe fee will actually be refunded. Reduce Stripe Fee G/L and Refunds by the Stripe fee related to any current month period refunds

Tax Reconciliation (Ordway Sales Tax Report and Avalara)

Credits are not reported in Avalara. As a result, reconciliation between the Ordway Sales Tax Report, Avalara, and the General Ledger Tax account may differ during reporting periods that include tax credits.

MRR Reconciliation (Ordway to External System) 

Objective

Validate the completeness and accuracy of MRR in Ordway by comparing it with your CRM. This reconciliation verifies that bookings have successfully synchronized through integrations, imports, or manual processes.

Filter 

• Discounted MRR = true or false, depending on how your CRM reports MRR.

Important! MRR is reported only when the last day of the month contains an active subscription with a recurring charge. One-time and usage-based charges are excluded unless configured otherwise.

Steps

1. Download/ Export the MRR report from Ordway.
2. Download/ Export the corresponding MRR report from your CRM (for example, Salesforce).
3. Compare records using a shared identifier, such as sf_account_id. If differences exist, verify:
   • Whether the subscription covered a partial period.
   • Whether the subscription is Active or still in Draft.
   • Whether subscriptions were cancelled during the month.