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Journal Entry Prep

AnthropicOfficialPublished by Anthropic

  • Skill
  • Guidelines
  • Business and productivity
  • Apache-2.0
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From the author

Prepare journal entries with proper debits, credits, and supporting documentation for month-end close. Use when booking accruals, prepaid amortization, fixed asset depreciation, payroll entries, revenue recognition, or any manual journal entry.
— the description by Anthropic

AutoGineer summary

Written by AutoGineer from the skill’s own files, not by the author

This skill provides a structured framework for accounting teams to manage month-end journal entries. It outlines standard entry types, including accruals, depreciation, prepaid amortization, payroll, and revenue recognition. The guide also details essential supporting documentation requirements, recommended approval workflows based on materiality thresholds, and a comprehensive checklist for reviewers to ensure accuracy and audit readiness.

What it does

  • Defines standard journal entry structures for common accounting tasks
  • Provides guidance on calculating accruals, depreciation, and amortization
  • Outlines documentation requirements for audit support
  • Suggests approval matrices based on transaction amounts
  • Offers a review checklist to verify entry accuracy and coding
  • Identifies common errors to avoid during the month-end close process

When to use it

  • When preparing manual journal entries for month-end close
  • When setting up recurring accruals or amortization schedules
  • When establishing review and approval procedures for financial entries
  • When training staff on accounting documentation standards

Advantages

  • Promotes consistency in accounting treatment across periods
  • Helps ensure entries are supported by clear documentation
  • Provides a systematic approach to identifying and preventing common errors
  • Facilitates structured review workflows for financial oversight

Usage examples

“What are the standard components required for a journal entry to be audit-ready?”
The skill lists seven requirements, including a clear description, calculation support, source document references, period identification, preparer details, approval evidence, and reversal indicators.
“How should I structure a payroll accrual entry?”
The skill provides specific debit and credit examples for salary, bonus, benefits, and payroll tax accruals, noting that salary accruals should be based on working days.

Install

  1. Download the skill as a ZIP:

    https://autogineer.com/agent-skills/anthropics/journal-entry-prep/download
  2. Unzip it into the cross-client skills folder of your project:

    mkdir -p .agents/skills && unzip journal-entry-prep.zip -d .agents/skills

Documentation by Anthropic

Journal Entry Preparation

Important: This skill assists with journal entry workflows but does not provide financial advice. All entries should be reviewed by qualified financial professionals before posting.

Best practices, standard entry types, documentation requirements, and review workflows for journal entry preparation.

Standard Accrual Types and Their Entries

Accounts Payable Accruals

Accrue for goods or services received but not yet invoiced at period end.

Typical entry:

  • Debit: Expense account (or capitalize if asset-qualifying)

  • Credit: Accrued liabilities

Sources for calculation:

  • Open purchase orders with confirmed receipts

  • Contracts with services rendered but unbilled

  • Recurring vendor arrangements (utilities, subscriptions, professional services)

  • Employee expense reports submitted but not yet processed

Key considerations:

  • Reverse in the following period (auto-reversal recommended)

  • Use consistent estimation methodology period over period

  • Document basis for estimates (PO amount, contract terms, historical run-rate)

  • Track actual vs accrual to refine future estimates

Fixed Asset Depreciation

Book periodic depreciation expense for tangible and intangible assets.

Typical entry:

  • Debit: Depreciation/amortization expense (by department or cost center)

  • Credit: Accumulated depreciation/amortization

Depreciation methods:

  • Straight-line: (Cost - Salvage) / Useful life — most common for financial reporting

  • Declining balance: Accelerated method applying fixed rate to net book value

  • Units of production: Based on actual usage or output vs total expected

Key considerations:

  • Run depreciation from the fixed asset register or schedule

  • Verify new additions are set up with correct useful life and method

  • Check for disposals or impairments requiring write-off

  • Ensure consistency between book and tax depreciation tracking

Prepaid Expense Amortization

Amortize prepaid expenses over their benefit period.

Typical entry:

  • Debit: Expense account (insurance, software, rent, etc.)

  • Credit: Prepaid expense

Common prepaid categories:

  • Insurance premiums (typically 12-month policies)

  • Software licenses and subscriptions

  • Prepaid rent (if applicable under lease terms)

  • Prepaid maintenance contracts

  • Conference and event deposits

Key considerations:

  • Maintain an amortization schedule with start/end dates and monthly amounts

  • Review for any prepaid items that should be fully expensed (immaterial amounts)

  • Check for cancelled or terminated contracts requiring accelerated amortization

  • Verify new prepaids are added to the schedule promptly

Payroll Accruals

Accrue compensation and related costs for the period.

Typical entries:

Salary accrual (for pay periods not aligned with month-end):

  • Debit: Salary expense (by department)

  • Credit: Accrued payroll

Bonus accrual:

  • Debit: Bonus expense (by department)

  • Credit: Accrued bonus

Benefits accrual:

  • Debit: Benefits expense

  • Credit: Accrued benefits

Payroll tax accrual:

  • Debit: Payroll tax expense

  • Credit: Accrued payroll taxes

Key considerations:

  • Calculate salary accrual based on working days in the period vs pay period

  • Bonus accruals should reflect plan terms (target amounts, performance metrics, payout timing)

  • Include employer-side taxes and benefits (FICA, FUTA, health, 401k match)

  • Track PTO/vacation accrual liability if required by policy or jurisdiction

Revenue Recognition

Recognize revenue based on performance obligations and delivery.

Typical entries:

Recognize previously deferred revenue:

  • Debit: Deferred revenue

  • Credit: Revenue

Recognize revenue with new receivable:

  • Debit: Accounts receivable

  • Credit: Revenue

Defer revenue received in advance:

  • Debit: Cash / Accounts receivable

  • Credit: Deferred revenue

Key considerations:

  • Follow ASC 606 five-step framework for contracts with customers

  • Identify distinct performance obligations in each contract

  • Determine transaction price (including variable consideration)

  • Allocate transaction price to performance obligations

  • Recognize revenue as/when performance obligations are satisfied

  • Maintain contract-level detail for audit support

Supporting Documentation Requirements

Every journal entry should have:

  1. Entry description/memo: Clear, specific description of what the entry records and why

  2. Calculation support: How amounts were derived (formula, schedule, source data reference)

  3. Source documents: Reference to the underlying transactions or events (PO numbers, invoice numbers, contract references, payroll register)

  4. Period: The accounting period the entry applies to

  5. Preparer identification: Who prepared the entry and when

  6. Approval: Evidence of review and approval per the authorization matrix

  7. Reversal indicator: Whether the entry auto-reverses and the reversal date

Review and Approval Workflows

Typical Approval Matrix
Entry TypeAmount ThresholdApprover
Standard recurringAny amountAccounting manager
Non-recurring / manual< $50KAccounting manager
Non-recurring / manual$50K - $250KController
Non-recurring / manual> $250KCFO / VP Finance
Top-side / consolidationAny amountController or above
Out-of-period adjustmentsAny amountController or above

Note: Thresholds should be set based on your organization's materiality and risk tolerance.

Review Checklist

Before approving a journal entry, the reviewer should verify:

  • [ ] Debits equal credits (entry is balanced)

  • [ ] Correct accounting period (not posting to a closed period)

  • [ ] Account codes exist and are appropriate for the transaction

  • [ ] Amounts are mathematically accurate and supported by calculations

  • [ ] Description is clear, specific, and sufficient for audit purposes

  • [ ] Department/cost center/project coding is correct

  • [ ] Treatment is consistent with prior periods and accounting policies

  • [ ] Auto-reversal is set appropriately (accruals should reverse)

  • [ ] Supporting documentation is complete and referenced

  • [ ] Entry amount is within the preparer's authority level

  • [ ] No duplicate of an existing entry

  • [ ] Unusual or large amounts are explained and justified

Common Errors to Check For

  1. Unbalanced entries: Debits do not equal credits (system should prevent, but check manual entries)

  2. Wrong period: Entry posted to an incorrect or already-closed period

  3. Wrong sign: Debit entered as credit or vice versa

  4. Duplicate entries: Same transaction recorded twice (check for duplicates before posting)

  5. Wrong account: Entry posted to incorrect GL account (especially similar account codes)

  6. Missing reversal: Accrual entry not set to auto-reverse, causing double-counting

  7. Stale accruals: Recurring accruals not updated for changed circumstances

  8. Round-number estimates: Suspiciously round amounts that may not reflect actual calculations

  9. Incorrect FX rates: Foreign currency entries using wrong exchange rate or date

  10. Missing intercompany elimination: Entries between entities without corresponding elimination

  11. Capitalization errors: Expenses that should be capitalized, or capitalized items that should be expensed

  12. Cut-off errors: Transactions recorded in the wrong period based on delivery or service date

Files

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Requirements and compatibility

Written for: Claude Code, Claude apps

Works with: Claude Code, Claude apps, OpenAI Codex, GitHub Copilot, Cursor, Gemini CLI, Kiro, OpenCode, Goose, Amp, Roo Code, JetBrains Junie, Factory Droid, Devin (ex-Windsurf), Mistral Vibe, OpenHands, Letta

“Works with” means the tool reads the open Agent Skills format; a skill written for one tool may use features others lack.

Needs: Claude Code frontmatter

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Attribution and licence

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Publisher
Anthropic (Official)
Source
anthropics/knowledge-work-plugins · finance/skills/journal-entry-prep · commit e050c2e
Licence
Apache License 2.0 (redistribution allowed)
  • LICENSE (added by AutoGineer from finance/LICENSE)
  • ATTRIBUTION.md (written by AutoGineer)
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