Page 1/8

PERIOD END CLOSURE CHECKLIST BALANCE SHEET

Documentation Required Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

Fixed assets (Tangible/Intangible/Financial Investments)

Specification and documentation of goodwill, amortization of goodwill and impairment.

Input to (e.g. Restructuring plans/Office Movements etc.) and Process for Impairment Testing should be documented, incl. the Results (even if zero) of Management Review and decision process should be available.

Y

Specification and documentation of other intangible FA and related amortization.

For all valuation areas (fiscal/ local statutory and US GAAP)

Y

Reconciliation to fixed asset register: specification net book value opening balance-additions-retirements-depreciation. Review FA movements

Include review of P&L related to FA disposals; Reconciliation for all Valuation areas (fiscal/ local statutory and US GAAP) should be available as well as analysis & reconciliation between the valuation areas.

M

Specification and documentation of impairment Testing of Tangible Fixed Assets

Even if test does not lead to any Result Impact, process to tests and decisions made are required

Y

Schedule FA physical count Documentation of Process and Results from count e.g. Losses taken, changes/deletions from Register should be available. Ensure proper authorisation approval process has been performed.

Every 3Y

Feeders: Verification sales by location or account to justify the cost of providing free equipment.

Review result and input to impairment tests Q

Review Capital expenditure approval - Tracking

M

Inter-company accounts

Communication of late fiscal month IC transactions

M

Confirmation and reconciliation of inter-company balances with other JD companies

All differences above >5 USD k will be questioned

M

Page 2/8

BALANCE SHEET Documentation Required

Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

Stocks

Schedule stock counts (including consignment, equipment, machines and spare parts) and agree frequency (minimum 1 wall-to-wall count per year)

If local/fiscal requirements allow, avoid the wall-to-wall cycle count activity around year-end.

Y

Results of (cycle) counts held during the month (if applicable) and the adjustment booking that have been made accordingly (FD, or other person assigned by FD, to approve the adjustment before booking)

Frequency and Results of cycle tests should be available in Year-end package

M

Reconciliation sub-ledger total to general ledger amount including analysis of differences and negatives (if any)

Particularly review the variance analysis for materiality, and in such a sense that adjustment of the standard cost prices at balance sheet date might be required

M

Calculation and specification of stock provision, including movement (cross reference to P&L)

Analyse quantity of Stock on hand versus Sales in the past year. Make assumption for the provision based on Excess Inventory: between 1-2 years; 2-3 years; above 3 years;; no Sales in prior year period: 100% provision. (With respect of equipment/machine items, the methodology is the same, but the comparison can be made with the usage of the related chemicals.) Reconcile any variance of the Stock Provisions between local statutory and concern/Hyperion reporting.

Q

Specification of slow moving stock and rotation/ageing analysis on possible obsolete and slow moving inventories

Q

Check all UAB/Unilever positions tie up to zero

M

Specification of all consignment stock per location

Q

Trade Accounts Receivables

Complete monthly posting of bank M

Page 3/8

BALANCE SHEET Documentation Required

Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

transactions

Reconciliation sub-ledger total to general ledger amount including analysis of differences (if any)

M

Analysis of % of credit notes and major causes

M

Ageing overview of trade debtors in total amounts

M

Review goods returned M

Overview of customers and receivable amounts above the agreed credit limits

M

Review open sales orders (including service orders) to ensure proper billing and month-end cut-off

M

Reconciliation of GDNI (Goods delivered not invoiced)

M

Specification of doubtful debtors (categorised per risk level)

M

Specification of officially declared bankrupt debtors

Q

Calculation and specification of provision doubtful debt including movement (cross reference with P&L)

M

Specification and ageing of other receivables

Q

Specification of AR balances with negative amounts

Documentation of reasons for negative AR positions and follow up procedures are required

M

Specification of bad debt written off, including specification of recuperated taxes and including proper authorisation

M

Calculation of Rebates and Ship-through provisions

See also Accruals; calculations should tie back to contract details, and level of sales to date.

M

Prepaid expenses & deferred income

Page 4/8

BALANCE SHEET Documentation Required

Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

Specification prepaid expenses and deferred income, including review of regular release to P&L

Documentation at invoice level/individual contracts.

M

Specification of receivables for bonuses, commissions, marketing refunds or other claims and supplier bonuses

Documentation should tie back to contracts and related purchase levels.

M

Specification of accrued income M

Cash & Banks

Reconciliation of cash on hand (actual cash vs. cash book and general ledger)

M

Reconciliation of short time deposits (bank statement vs. general ledger)

M

Reconciliation of short time deposits (bank statement vs. general ledger)

Reconciliation bank accounts (bank statement vs. general ledger) including specification of cash and cheques in transit

M

Petty Cash - overview of cash at hand per location

M

Equity

Reconciliation of Hyperion’s equity with statutory equity

Cross check the information with Deferred Tax Provisions; analyse the difference to the main Balance Sheet Headers.

Y

Movement schedule of equity and related specification

Y

Suspense Accounts

Create list of all suspense accounts (regarless B/S heading) and analyse open item details

Perform age analysis of all open items and earlier review processes performed to solve these open items.

M

Short Term Borrowings and Inter-company

Page 5/8

BALANCE SHEET Documentation Required

Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

Reconciliation short term loans (bank statement vs. general ledger)

M

Reconciliation inter-company loans including counterpart confirmation

M

Trade accounts Payable

Complete monthly posting of bank transactions and invoices

M

Reconciliation sub-ledger total to general ledger amount including analysis of differences and debit balances (if any)

Analysis of debit balances and follow up process should be documented

M

Specification of intermediate accounts GRNI (invoices to be received, goods to be received, unmatched receipts).

Review that open items are not older than 3 months

M

Ageing analysis by supplier Q

Specification of outstanding purchase orders (reconciled and cleared for unmatched and old items)

M

Income/Profit Tax

Specification of accrued taxes and loss compensation

Review total tax position, including potential prepayments which may require offsetting

Q

Deferred taxes

Specification of deferred tax calculation and movement schedule

Analyse the tax calculation back to the main Balance Sheet Headers, and split each of the differences in valuation to Permanent (no deferred tax impact) and Temporary Differences (deferred tax is applicable); see also Excel tool issued by Tax Department

Y

Other Short term Accruals

Page 6/8

BALANCE SHEET Documentation Required

Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

Specification accrued expenses/costs A recurring process and approach should be taken to confidently estimate the costs of goods and services received in the Staff Costs area e.g. Involve all Budgetholders to estimate costs applicable to the current period, but for which invoices are not yet received. The level of detail to allocate the accruals to the correct budget codes may vary, however a review process to proof/justify the total level of accruals taken is required. Where less detail in the accrual process is performed, a couple of year's historical data and justification thereof may be required.

M

Specification accrued transport Freight costs provisions for incoming goods should be able to tie back to goods received, these type of accruals in case of standard costing are often system triggered.

M

Warehouse and Distribution Costs and provisions re Sales should be estimated, using either contracts, historical data, and Sales activitiy

M

Specification accrued customer commissions

Calculations should tie up to the existing contracts and related level of sales; documentation should be based on individual customers

M

Specification accrued customer bonuses M

Specification accrued interest Calculation should tie to contract agreements M

Calculation and specification of all other liabilities such as: provision 13

th month and

provision holiday pay, bonus to employees

Based on Year to date data, provisions need to be estimated. Review process of the total level of accruals taken is required.

M

Provisions

Specification and Documentation should be available for all Non-current provisions and Liabilities,

M

Page 7/8

BALANCE SHEET Documentation Required

Additional Comments, Suggestions for Approach

Frequency Preparer Signature Date completed

Reviewer If Appl.

Signature

Pension and similar retirement provisions should be documented and reconciled back to Towers Perrin information

Y

Restructuring provisions, review and updates

Actuals should be reviewed against original MEA budgets, and variance should be analysed for potential adjustments or releases.

M

A potential list of contingencies should be available, and documentation/argumentation is required why these are not included in the accounts.

Y

A list of future liabilities and their documentation is required.

Y

General

Check on balances of trial balance M

Reconcile all suspense accounts M

Run month-end FX revaluation M

Print of final balance sheet and P&L account from local system and Hyperion as working document for filing purposes

Cross check the information back to Net Equity and Deferred Tax

M

Reconciliation trial balance and P&L to reporting package. Detail and document US GAAP journal entries

If necessary, document any irregularities which were not resolved before the Reporting

M

Variance analysis are required for all reporting lines

Analysis both against budget, and prior year/opening data

FD to review (high-level) all direct GL entries for unusual amounts/transactions before reporting

M

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Profit & Loss

Documentation Required Frequency Preparer Signature Date

completed Reviewer If

Appl. Signature

Turnover & Cost of sales

Analytic review of sales, cost of goods sold and gross margin: comparison of monthly and YTD actual to budget, including detailed explanation of major differences. At a minimum at customer segment level, including exceptional margin explanation)

M

Specification and review of unsatisfactory margins M

Specification realised/accrued discounts/bonuses and other supplier payments booked in the margin per supplier

M

Specification of amount of credit notes issued/received M

Specification of other adjustments/bookings in the margin M

Specification of the amount of payment discount paid to customers and received from suppliers

M

Reconciliation of movement in VAT accrual with VAT on sales Q

Analytic review of factory results: comparison of monthly and YTD actual to budget, including detailed explanation of major differences

M

Price increasing analysis per customer/market sector/product level Q

Operating Expenditure

Analytic review of operational expenses: comparison of monthly and YTD actual to budget operational cost categories, including detailed explanation of major differences

M

Reconciliation of specified payroll with expense in the general ledger and bank payment M

Reconciliation of depreciation expenses with fixed assets register M

Operating income/costs (in case of material difference actual vs. budget)

Specification interest income and expenses M

Specification of other financial income and expenses M

Analysis of average debt position and relating interest expenses Q