Master PBC by Area

Area Core items
Cash Statements, recs, outstanding log — see Bank Rec
AR/AP Agings, subsequent cash/disbursements — see Collections and AP Fraud
Payroll Register = GL = 941 = W-2 — see Payroll Year-End
Revenue Cut-off samples, contracts — see ASC 606
Leases/Fixed assets Registers + invoices — see ASC 842 and Fixed Assets
Debt/Equity Agreements, cap table — see Debt and Cap Table
Tax Provision, returns, 1099 file — see Year-End Tax
IT Access lists, change logs — see QuickBooks vs Xero

Pair with Year-End Close, Q1 Prep, SOX 404, and Audit Procedures.

Tracker Discipline

  • Owner + due date + status + reviewer per item.
  • Weekly PBC meeting from November; blockers escalated same day.
  • Version control; no duplicate filenames.

Link to Month-End Close for in-year readiness and Internal Controls for walkthroughs.

Worked Example: The $40k Adjustment That Started as a Missing Contract

Fieldwork day 3: revenue cut-off sample hits a $40,000 December invoice with no signed contract in the file. The PBC said “contracts filed.” Investigation finds the signed MSA in sales’ email, service delivered December 28, payment received January 12. Result: revenue stands, but the auditor logs a control deficiency (contract filing) and expands cut-off sampling from 25 to 60 items — adding two fieldwork days at $350/hr blended. A $40k sample with a filed contract costs 10 minutes; without it, ~$5,600 in fees plus a findings memo. Multiply by every area: each missing PBC item doesn’t just delay — it expands scope.

High-Risk PBC Deep Dives (What Auditors Actually Do)

Revenue cut-off. Not just “invoices near year-end” — subsequent cash receipts tied to pre-year-end AR (proves existence + valuation), credit memos issued post-year-end (revenue reversal risk), and deferred-revenue rollforward to contracts — see ASC 606 and Collections.

Payroll tie-out. Register = GL = 941s = W-2s with the bridge memo for fringe and voids — see Payroll Year-End. Payroll is where auditors find unrecorded liabilities (accrued bonuses, PTO — see PTO Accrual).

Related parties. Agreements, pricing memos, confirmations, bank proof — see Related Party. Missing related-party support doesn’t just delay; it raises fraud-risk assessment across the audit.

IT access. User lists with joiners/leavers, admin rights, and change logs for finance apps — see QuickBooks vs Xero and NIST. First-year clients underestimate this; auditors can’t rely on system reports without it.

PBC Meeting Cadence (November to Opinion)

Week Focus Attendees
Nov W1 Freeze index, assign owners/dates Controller + auditor manager
Nov–Dec weekly Pre-tie status, blocker escalation Preparers + controller
Jan W1 80% complete target; open items named with dates Controller + CFO
Fieldwork W1 100% + subsequent-events sweep scheduled Full team
Pre-opinion Representation letter, subsequent review to report date CFO + audit committee — see Audit Committee

Track in one shared log (item, owner, due, status, reviewer). Email-only support with no tracker is how PBCs die — see Internal Controls.

FAQ

What causes most delays?

Late AP, payroll tie-outs, and missing contracts. Pre-tie in November.

How do we reduce fees?

Complete PBCs on time, clean recs, and single-point auditor contact.

Next Steps

  1. Freeze PBC index with owners this month.
  2. Pre-tie cash, AR/AP, and payroll early.
  3. Lock binder before fieldwork week one.