Designed for: accountants, finance managers, controllers, process owners and reviewers working inside organisations.
1. Process objective
Close purchase liabilities completely using invoice, receipt, service and obligation evidence. The process should produce a result that is complete, accurate, supported, approved and traceable to the financial statements.
2. Core workflow
- Reconcile AP sub-ledger to the general ledger.
- Review goods received not invoiced and invoice received not recorded.
- Accrue services received before invoice.
- Reverse or true-up estimates systematically.
- Investigate debit balances, old advances and duplicate vendors.
3. Practical situation
A maintenance service for March is invoiced in April. The March close records an accrual based on service confirmation and contract rates, then reverses or clears it when the invoice is booked.
4. Ownership model
| Role | Responsibility |
|---|---|
| Preparer | Obtains source data, performs the calculation or reconciliation and explains exceptions. |
| Process owner | Confirms operational facts, resolves missing information and approves business assumptions. |
| Reviewer | Challenges completeness, accounting treatment, material judgments and unresolved items. |
| Controller | Monitors completion, escalates risk and ensures the result flows correctly into reporting. |
5. Minimum evidence pack
- Approved policy or process note
- Source-system report and data lineage
- Reconciliation or calculation schedule
- Exception log with owner and ageing
- Preparer and reviewer sign-off
6. Reviewer challenge
- Is the population complete and tied to the general ledger?
- Are aged or unusual items separately explained?
- Does the treatment follow the entity policy and applicable standard?
- Are assumptions supported by current information?
- Is every adjustment posted, approved and traceable?
Newton of Accounts approach:
Conceptual clarity is drawn from CA Pranav P. Tulshyan’s accounting teaching work, then independently developed into professional workflows, controls and documentation for company accounts.