Financial closing is a key and final process in generating reliable financial statements. Financial closing process as such is a high risk activity. In a nutshell, in the closing process, organizations need to obtain, analyze, consolidate information from various resources, perform reconciliations, and make adjustments before a set of financial statements can be made. Many company's lack a properly coordinated financial closing process. Lack of formally defined procedures is the number one reason for poor controls. The financial closing process should be documented in detail, so that controls relating to the financial closing process can be designed properly and their operating effectiveness can be evaluated.

In Sarbanes Oxley 404 scenario, it is important to keep some things in mind which help in the overall controls in the financial closing process.

1. Has the management documented the entire financial closing process in sufficient detail from data collection to final report making.

2. Have control activities been documented which define the controls realting to the financial closure process.

3. Has a risk assessment been conducted to assess the inherent risks in the closure processs.

4 How and by whom is the financial closure process monitored. How is completeness of the process determined.

5. How are communication procedures defined which ensure a smooth financial closure in a timely manner.