Summary
In a manufacturer with several plants, the close is held up by information that arrives late: purchase bills still in email, transfers recorded at one plant and not the other, and stock, work in progress and accruals worked out only after the month ends. A close of three working days rests on one habit. Each transaction is captured once, when it happens, in a record that every plant and the head office share. This article sets out where the days go, a day-by-day close calendar, the reports a board should receive and the checks the accounts team should run. Our working target here is three working days; adjust it to your own reporting deadlines.
01A working example
Take a manufacturer that runs three plants in two states. GST requires at least one registration in each state where a business supplies from, so it holds two. Each month it receives about 4,500 purchase bills, raises about 1,200 sales invoices and moves goods between plants about 300 times.
Suppose the books take eight working days to close. October's management accounts then reach the directors around the middle of November. Decisions on pricing, purchase and credit for the rest of November are taken on figures for trading that is between two and eight weeks old.
The volumes in this example are illustrative. The method applies at any size.
02Where the days go
Purchase bills that arrive after the goods
Bills come by email, by courier and as phone photos forwarded on WhatsApp, and many reach the accounts team several days after the material was received at the gate. Until a bill is entered and matched to its purchase order and goods receipt, the cost of that material is missing from the month.
If keying and checking takes four minutes a bill, 4,500 bills take about 300 hours a month, most of it squeezed into the last week. Time your own team for a week to get the real figure.
Transfers between plants in different states
When a plant in one state sends goods to a plant in another, the two plants are distinct persons under Section 25(4) of the CGST Act, and under paragraph 2 of Schedule I a supply between distinct persons is taxable even without consideration. Four further rules shape how the transfer must be handled.
- Value
- Rule 28 of the CGST Rules sets the value. Under its second proviso, where the receiving plant is eligible for full input tax credit, the value declared on the invoice is accepted as the open market value. Most manufacturers therefore bill transfers at cost or at a fixed transfer price.
- E-invoice
- A business whose aggregate turnover exceeds ₹5 crore must report each transfer invoice to the Invoice Registration Portal and carry its reference number (IRN), as for any other B2B supply.
- Credit at the receiving plant
- The receiving plant's credit appears in its GSTR-2B only after the sending plant files GSTR-1. A transfer billed on the 30th and filed late delays the receiving plant's credit.
- Company accounts
- In the company's own financial statements a transfer is not a sale. It must be eliminated when the plants' results are combined, or revenue and cost are both overstated.
When each plant keeps its own register, the two sides rarely agree on the first attempt. Quantities differ because of transit loss, values differ because one side used standard cost and the other the invoice value, and dates differ across the month end.
Stock, work in progress and accruals at month end
Stock valuation, work in progress and accruals for goods and services received without a bill are often worked out only after the month ends. Each needs information from the plants: counts, production records, gate entries and service reports. When these arrive by email over several days, so does the close.
Reports built outside the books
When plant-wise profit is assembled in spreadsheets from exports, every figure has to be checked again before anyone trusts it, and inter-plant transfers have to be removed by hand.
03What a three-day close looks like
Nothing waits for month end
Bills are read and matched on the day they arrive. A bill that matches its purchase order and goods receipt within the agreed tolerance is posted. A bill that does not goes to a short exception list with the reason shown, such as a rate above the order or a quantity above what was received.
A transfer is one document with two sides
The sending plant's dispatch and the receiving plant's receipt refer to the same transfer. Transit loss is recorded against that transfer with its reason, instead of being discovered as a difference at month end.
Stock and production recorded as they happen
Material issued to production, output and scrap are recorded on each work order as the shift ends. Work in progress at month end can then be valued from the open work orders themselves.
Plant-wise results from the ledger
Revenue, material cost, transfers and overheads are tagged to the plant when they are recorded. Plant-wise profit is a view of the ledger, with transfers eliminated in the combined view.
04A close calendar
The calendar below is a working pattern for a business with monthly GST returns. Statutory dates are as at the date this article was reviewed.
| Working day or date | Work |
|---|---|
| Every day of the month | Bills captured and matched; transfers recorded at dispatch and receipt; production output recorded; bank lines matched |
| Day 1 | Cut-off: last dispatches and receipts confirmed at each plant; stock counts at selected locations |
| Day 1 | Accruals for material received without a bill and services used without an invoice; freight and power accrued by plant |
| Day 2 | Transfers reviewed: every transfer received or explained; transit loss written off with approval |
| Day 2 | Depreciation, prepaid expenses and payroll entries posted; work in progress valued from open work orders |
| Day 2 | Customer and supplier balances reviewed for disputed and old items |
| Day 3 | Plant-wise profit and loss, stock and work in progress reviewed by the finance controller |
| Day 3 | Board pack issued |
| 7th | Tax deducted at source for the previous month deposited |
| 11th | GSTR-1 filed, monthly filers |
| 14th | GSTR-2B for the previous month generated |
| 15th | Provident fund and ESI contributions paid |
| 20th | GSTR-3B filed, monthly filers |
05Five reports a board should receive by the third working day
- Profit and loss by plant, with transfers eliminated in the combined view, material cost as a share of sales and the change from last month.
- Cash and working capital: cash, money owed by customers by age, money owed to suppliers by due date, and stock in days.
- Overdue money by customer, with the ten largest named and the reason each one is late.
- Stock movements: slow-moving and non-moving items by value, transit loss by route and write-offs approved.
- GST position: tax payable for the month from the sales register, input tax credit booked from the purchase register, and credit still at risk from the previous month's GSTR-2B.
06Checklist for the accounts team
- [ ] Every bill received this month is posted or on the exception list with a reason
- [ ] Every transfer dispatched has a receipt, or a transit note explaining why not
- [ ] Transfer invoices between registrations carry an IRN where e-invoicing applies
- [ ] Bank accounts are matched to the last day
- [ ] Accruals are posted for goods and services received without a bill
- [ ] Work in progress agrees with open work orders
- [ ] Customer and supplier balances over 90 days are reviewed and noted
- [ ] Stock counts agree with the books, or differences are approved and posted
- [ ] Payroll, depreciation and prepaid entries are posted
- [ ] Plant-wise profit is reviewed by the finance controller before the board pack goes out
07How MatruOS runs each step
Bills read as they arrive
Bills forwarded by email or WhatsApp, uploaded as files or photographed on a phone are read and prepared as purchase entries. A person confirms each entry before it posts. Bills for goods already received on a goods receipt are entered against that receipt instead, so the stock is not counted twice.
GSTR-2B matched to the purchase register
The GSTR-2B file downloaded from the GST portal, in JSON or Excel, is brought into the Accounts area and matched to purchase bills. The screen shows the credit the law allows, the documents that differ, the bills suppliers have not filed with a note ready to send to each supplier, and the IMS decision to take on the portal for each document.
Plants, godowns and branches as places
Each is a place in the business, carrying its own GST registration where it has one. A transfer moves stock from one place to another in a single entry.
Production recorded on work orders
Material issued, output, rejected quantity and scrap are recorded on each work order. A work order closed short books what is left in work in progress as a production difference.
Approvals in one queue
In any area the business sets to Ask me, and for any AI change with a line amount above a limit it sets, the AI team's changes wait in Approvals with the AI member's note until a person approves or rejects them. Posting or reversing a journal and closing a period always wait for a person when an AI member proposes them.
AI can make mistakes. In areas set to Ask me, every change the AI team prepares waits for a person; in areas set to Auto, routine bookkeeping and stock changes go ahead and appear in the activity trail. A business that wants every entry checked keeps bookkeeping and stock on Ask me.
Sources
Checked 31 October 2026.
- Central Goods and Services Tax Act, 2017 (CBIC): Section 25(4); Schedule I, paragraph 2.
- CGST Rules, 2017 (CBIC): Rule 28, second proviso.
- CBIC Notification No. 10/2023-Central Tax, 10 May 2023: e-invoicing for aggregate turnover above ₹5 crore from 1 August 2023.
- GST portal news and advisories: GSTR-1 on the 11th, GSTR-2B on the 14th and GSTR-3B on the 20th for monthly filers.