With summer slipping away and business picking up, the transition into the last quarter of the year can feel like stepping onto a treadmill that keeps speeding up. For many finance leaders, preparing for year-end closing can bring a mix of feelings and emotions.
On the one hand, you might feel anticipation and excitement to confirm if all your best-laid plans will unfold. But you might also experience a sense of urgency and pressure to ensure all the financial pieces fall into place before the calendar hits December 31st.
Every CFO knows how important it is to close out the year on a high note and the challenges that come with it. Whether it’s revising and adjusting budgets that didn’t hit the mark or bringing hard topics to discuss at the exec team table, the weeks before the start of the last quarter of the year are all about strategic focus and proactive planning. The good news is that if you plan and do all the prep work before October starts, all the foundations will be laid down, making it easier to focus on the season’s main event: budgeting for the year ahead.
This check list will cover the main areas you should focus on as Q4 approaches, from building the right systems to simplify your year-end close reports to adjusting your budgets to the current reality.
Year-end closing: preparing ahead for a smooth finish
Year-end closing requires a lot of focus from the team. Multiple steps are involved, and attention to detail is crucial. The key to achieving this and making it a smooth sailing experience? Creating the right processes throughout the year so there are no last-minute surprises.
As soon as Q3 wraps up, you often know how the rest of the year will unfold so the team can start preparing all the groundwork for October and November. Teams have their monthly and quarterly closing checklists, but year-end involves more than just crunching numbers — it’s about ensuring that all accounts are reconciled, intercompany balances are cleared up, and any potential issues are identified and addressed before they become last-minute crises.
If you plan and do all the prep work before October starts it will be easier to focus on the main event: budgeting for the year ahead.
All quarters look different, but they should always be planned to avoid setbacks when ad hoc requests come in during this time. That’s why it’s important to create the right systems with your team so all checks and internal audits can be done every quarter. This way, all potential discrepancies can be identified earlier so they can be resolved with the necessary actions, avoiding the stress of last-minute adjustments.
Budget revisions: ensuring targets are met
Most of a finance leader’s Q4 is spent working on next year’s budget. But before then, it’s important to ensure they meet the goals established for the current year. This means revisiting and revising budgets and, if necessary, taking action to guarantee those targets are reached before the year comes to an end.
Finance and accounting teams should do these revisions each quarter to keep track of everything happening in the business. This becomes especially important during Q4, as you can get a glimpse of what will happen by year-closing and act where needed. If the organisation is on track with its budget, it should focus on maintaining momentum, making minor adjustments, or, if you have extra funds, even considering investing them.
However, if you’re falling short, September is the time to work on a contingency plan to start acting sooner rather than later. Finance and accounting teams must thoroughly analyse the business during the first two weeks of the month to identify the major gaps and understand what actions need to be taken to revert the situation before the end of the year.
If the organisation is on track, teams should focus on maintaining momentum and making minor adjustments if needed.
This might involve making tough decisions, such as reallocating resources, cutting costs, or even postponing some of the activities planned for the last three months of the year. To achieve this, finance leaders must raise the topic with the organisation and the relevant stakeholders in the executive team so that, together, they can reach a consensus on a few key activities that can drive the best outcomes.
The Revenue Operations team can be your greatest asset at this point. By bringing in the right data, they can bring realistic facts to the table and even some solutions. They can look at past activities to understand what worked and suggest alternative actions for each team. After the decision on the actions has been made, the projects’ progress must be continuously tracked to ensure positive results before the end of the year.
Remember, the sooner you start these discussions, the better positioned you’ll be to make meaningful changes that can impact Q4 outcomes. Budget revisions are not just about reacting to the numbers but strategically guiding the team towards its financial goals.
Be mindful of seasonality
When revising budgets and considering the actions to take, finance leaders must be mindful of the seasonality, especially those who operate on a global scale.
The holiday season can bring great potential but is also unpredictable and challenging. Spending patterns shift, people take time off, and most are focused on closing their budgets for the year, making it harder for the team to achieve their targets.
One effective strategy I often suggest is to treat December as a half-month in terms of revenue expectations. Setting more conservative targets and focusing on achieving them before the holiday season starts can reduce the pressure and avoid the risk of last-minute fluctuations. This also allows you to be more effective with your cash management and ensure you have enough funds to cover expenses.
The holiday season can bring great potential but is also unpredictable and challenging.
During this time, it can also be important to postpone all non-essential expenses until the new year. Payments to maintain operations are critical, but all others should be put on hold whenever possible. This way, you can avoid overcommitting at a time when revenue may not be as predictable as usual.
Planning for the new fiscal year
While Q4 is about finishing the current year strong for both the finance team, it’s also the time to start thinking about what opportunities the new year will bring. And while most of the actual planning for the budget happens during those three months, you should start preparing for it beforehand.
All the steps mentioned above are crucial to laying the foundations of this project. You need to know where you stand, the company’s current financial position, and the main challenges and opportunities ahead. For that, you also need to align with your peers.
While most of the actual planning for the budget happens during Q4, you should start preparing for it beforehand.
The last few weeks of Q3 — and the first of Q4 — are the moment to gain clarity on these topics. This is the moment to look at the business plan, sit down with the CEO and start drawing up a plan for what the following year should look like. It’s also when you ask other departments to share their expectations, goals and insights so that together, you can shape realistic and achievable targets for the year that align with your board’s vision. Collaboration is key at this stage to avoid overly theoretical discussions during budgeting, focusing only on building a plan for the year ahead.
The work you do in Q4 will play a big role in shaping your company’s financial health and future direction. It’s all about preparation, making thoughtful decisions, and working closely with your team. Starting early with year-end tasks, revisiting budgets with a realistic view, and managing cash flow carefully during the holiday season are essential to closing the year on a high note.
But Q4 isn’t just about wrapping up the current year — it’s also about getting ready for what’s next. All the insights you gather during this time and your plans will become the foundations for the new year’s strategy. The quarter’s success will reflect all the planning, foresight, and hard work you put in before October started.
As you move through this busy period, staying level-headed is also important. Be realistic, consider all the facts when making decisions, and leave yourself some margin for execution. And while it might be challenging, remember that every step you take is helping your team achieve a great year-end closing so you can have a solid start for the next 12 months.