‍A step-by-step guide to gaining clarity, protecting profitability, and planning ahead

Running a successful independent insurance agency requires more than just writing business. Your agency’s financial foundation is what supports growth, strategic planning, and long-term sustainability.

Too often, agency owners focus on revenue while ignoring gaps in their financial process. Without a consistent month-end routine, it becomes easy to miss cash flow problems, overlook expense trends, or make decisions based on incomplete data.

This checklist outlines a reliable month-end process that any insurance agency can follow. Whether you're working with a bookkeeping team or managing your own books, these steps will help you close each month with clarity and confidence.

Pre-Close Tasks: Set the Stage

Start your close with cleanup and prep. These steps help ensure your data is complete and ready for review.

• Post any custom journal entries or client-specific adjustments
• Code all transactions from your bank feeds
• Reconcile your accounts receivable between your agency management system (AMS) and your accounting platform
• Match premium payables to your general ledger
• Calculate and record agency bill commission transfers

Account Reconciliation: Confirm the Numbers

Now it’s time to make sure everything matches. Accurate balance sheet accounts are key to a reliable close.

• Reconcile all bank accounts, including trust and operating accounts
• Review credit card balances and loan schedules
• Verify each balance matches the corresponding statement
• Investigate and resolve any aged or uncleared transactions

Transaction Review: Clean the Details

Even a few small errors can throw off your financial reports. This step focuses on accuracy and consistency.

• Assign missing payees to uncategorized transactions
• Check for inconsistent expenses by vendor
• Reclassify anything in suspense, miscellaneous, or temporary accounts
• Review large entries for capitalization or prepaid treatment
• Make sure all transactions are posted to the correct subaccounts

Vendor and Customer Cleanup: Keep It Organized

Maintaining clean records now will save you time during audits, reporting, and tax season.

• Review new vendors and assign correct classifications
• Merge duplicate vendors or customer profiles
• Identify new 1099-eligible vendors for tracking
• Double-check any new accounts added to your chart of accounts

Financial Statement Review: Understand the Story

This is where numbers meet strategy. Use your reports to identify trends and make informed decisions.

• Review your Accounts Payable and Accounts Receivable aging summaries
• Compare your balance sheet across the last three months to spot changes
• Analyze your profit and loss trends at the summary and transaction level
• Look for unexpected changes in revenue, commissions, or expenses
• Document key insights and areas that need follow-up

Cash Flow and KPI Review: Look Ahead

A strong month-end process isn’t just about the past. It helps you plan for what’s next.

• Update your 60- to 90-day cash flow projection
• Review key performance indicators such as retention, new business growth, cost per client, and producer profitability
• Compare your actuals to your budget and investigate any major differences
• Adjust your forecast or strategy based on what you’re seeing

Final Wrap-Up: Share and Plan

Finish your month-end process by communicating results and looking for tax or planning opportunities.

• Deliver your finalized reports to your leadership team or external partners
• Compare your year-to-date income to last year’s results
• If income has increased significantly, notify your tax advisor to evaluate planning options
• Log your takeaways and update your action items for the coming month

Why It Matters

Month-end is more than a financial to-do list. It’s how agency owners stay in control, make informed decisions, and prepare for what’s ahead.

At AgencyFocus, we help independent agencies understand their financials, but we can't do it without organized, accurate financials that reflect what's happening inside your agency. Our partner, AgencyPoint, helps agencies create an optimize their monthly systems that give them better visibility and stronger financial footing. If your month-end process feels unclear or incomplete, let’s talk.