A Monthly Financial Review Checklist for CEOs

Most CEOs know the broad strokes of their company’s numbers. They understand revenue, expenses, and maybe cash in the bank. But a monthly financial review is more than a quick glance at a dashboard. It is a chance to confirm the health of the business, spot risks early, and make decisions based on facts instead of instinct.

Unfortunately, many CEOs skip important steps or rely too heavily on what they assume the numbers mean. This leads to blind spots that only show up when a crisis hits. A disciplined monthly review prevents those surprises.

Below is a complete checklist you can follow every month, along with explanations, examples, and common mistakes CEOs make. Think of this as a practical guide to keeping your company financially sharp.

The CEO Monthly Financial Review Checklist

1. Confirm that the month-end close is complete

You cannot review anything until the accounting team has closed the books for the month.

This means:

• All revenue is recorded

• All expenses are posted

• Bank and credit card accounts are reconciled

• Accruals are updated

• Deferred revenue is adjusted

Why it matters:
Many CEOs review numbers before the close is done. They think they are looking at final results when they are really seeing incomplete data.

What to ask:
Has the accounting team finished the close and reviewed the numbers for accuracy?

2. Review the income statement, but focus on trends, not single numbers

Look at revenue, gross margin, and operating expenses. More important than the current month is the change compared to the previous three to six months.

Questions to ask:

• Is revenue stable, rising, or drifting down?

• Are margins tightening? If so, why?

• Which expense categories are increasing fastest?

Common CEO mistake:
Focusing on the current month and ignoring patterns. Trends reveal problems long before one month of numbers will.

Example:
If marketing spend increased by 20 percent over three months but lead volume stayed flat, you are losing efficiency. This does not show up in the income statement unless you look at trends.

3. Check budget vs. actuals

Even companies that create budgets often fail to compare them to actual performance.

Your review should include:

• Revenue vs. forecast

• Gross margin vs. target

• Operating expenses vs. budget

• Cash burn vs. plan

Why it matters:
A budget only has value if it is used as a steering tool. If you never compare actual results to the plan, you are flying blind.

4. Review cash flow and runway

Cash is the fuel of the company. Review both the statement of cash flows and a forward looking projection.

Focus on:

• Operating cash flow

• Monthly burn rate

• Cash runway

• Timing of major inflows and outflows

• Debt payments

Common CEO mistake:
Assuming profitability means strong cash flow. Companies can show profit while cash drains due to inventory buildup, slow collections, or upfront costs.

Example:
A subscription business sells annual plans but pays commissions and advertising costs upfront. The income statement looks healthy. The bank balance does not.

5. Review accounts receivable aging

Many CEOs overlook collections. They assume invoices go out and money comes in. That is not always the case.

Look at:

• Total accounts receivable

• Aging buckets (current, 30 days, 60 days, 90 days)

• The top ten overdue customers

Questions to ask:

• Are we collecting cash on time?

• Do we need changes in credit terms or follow up processes?

Late payments choke cash flow far more than most CEOs realize.

6. Review accounts payable aging

Companies sometimes delay payments to vendors without fully understanding the consequences.

Look at:

• What you owe

• How long bills remain unpaid

• Whether any key vendors are past due

Why it matters:
Stretching payables can buy short term breathing room. But repeated delays weaken vendor relationships and can reduce service quality.

7. Review working capital

Working capital is the difference between current assets and current liabilities. It shows whether you can cover short term obligations.

Focus on:

• Inventory levels

• Unbilled revenue

• Prepaid expenses

• Accrued liabilities

Common CEO mistake:
Focusing only on profit and ignoring working capital pressure. Many profitable companies fail because they manage cash poorly.

8. Review gross margin drivers

Your gross margin tells you whether your core product or service is healthy.

Ask:

• Did costs rise?

• Did pricing slip?

• Did discounts increase?

• Are vendors charging more?

Even small shifts in margin can change the trajectory of the business.

9. Review key performance indicators (KPIs)

Every business has a handful of metrics that define success.

Examples:

• Customer acquisition cost

• Inventory turns

• Lifetime value

• Utilization rate

• Average deal size

• Churn

• On time delivery

Use KPIs to confirm that the operational engine behind the numbers is running smoothly.

10. Check progress on financial risks

Every company has known risks. Each month, confirm their status.

Examples:

• Customer concentration

• Regulatory issues

• Contract renewals

• Debt covenants

• Hiring gaps

• System dependencies

Why it matters:
Ignoring known risks is one of the fastest ways a CEO loses control of the business.

11. Review major contracts and renewals

Look ahead 60 to 120 days.

Ask:

• Are any large customer or vendor contracts about to expire?

• Do we need to prepare for price negotiations?

• Do we need to make staffing or inventory adjustments?

This keeps surprises off your plate.

12. Review departmental spending

Look at team level budgets and compare them to actual spending.

Questions to ask:

• Are certain departments overspending?

• Are we hiring ahead of need?

• Do we have expenses that no longer serve the business?

13. Confirm compliance and audit status

Review filing deadlines, tax obligations, and any audit updates.

Why it matters:
Missed compliance deadlines create fines, stress, and distraction.

14. Review hiring and payroll forecasts

Headcount is one of the biggest expenses. Make sure hiring aligns with revenue and cash flow plans.

Ask:

• Are we hiring too quickly?

• Are we retaining top performers?

• Are compensation changes needed?

15. Ask your CFO for insights, not just reports

A CEO review is not about memorizing numbers. It is about understanding what the numbers say about the business.

Ask your CFO:

• What changed this month?

• What risks do you see?

• What opportunities should we pursue?

• What issues need CEO level decisions?

• What should we stop doing?

A strong CFO will translate the numbers into clarity.

Common Blind Spots and Misunderstandings Among CEOs

Believing revenue solves everything

Revenue helps. But if margins weaken or costs rise faster than income, growth can create more strain, not less.

Thinking profitable months equal healthy cash flow

Profit and cash are different. A company can report profit but choke on cash because customers pay late or inventory grows.

Assuming the finance team will fix issues without direction

The finance team cannot solve everything alone. Many issues start in sales, operations, or staffing. They need CEO involvement.

Treating the monthly review as an accounting exercise

This is a strategic meeting. It shapes decisions on hiring, growth, product direction, and risk.

Ignoring small problems until they become big

Most financial failures start as minor issues. Catch them early.

How CEOs Should Prepare for the Monthly Review

Block time consistently

Set a recurring time every month. Treat it as a core leadership responsibility.

Review a summarized package, not raw spreadsheets

Your CFO should hand you:

• Income statement

• Balance sheet

• Cash flow

• Forecast updates

• KPI dashboard

• Written commentary on variances

• Risks and recommendations

Commentary is essential. Numbers alone do not tell the story.

Come with questions

This is not a passive meeting. Challenge assumptions. Seek clarity. Push for insights.

Avoid diving into bookkeeping details

Focus on big levers:

• Margins

• Cash

• Efficiency

• Growth signals

• Risks

Finance handles the mechanics. You focus on decisions.

Example of a CEO Monthly Review in Action

Let us say a company has stable revenue but declining cash. In the meeting, several issues surface.

• Accounts receivable increased by 25 percent because sales reps shifted focus to new deals instead of collections.

• Discounting increased to close deals at the end of the month.

• Inventory levels rose due to an overly optimistic forecast.

• A vendor raised prices, tightening margins.

None of these issues would have been clear by looking at revenue alone. The monthly review connects the dots.

The CEO leaves with a clear plan:

• Enforce stricter approvals for discounts

• Add weekly collections targets

• Adjust the demand forecast

• Negotiate with the vendor or find alternatives

This is what a strong monthly review should accomplish.

Frequently Asked Questions

How long should a monthly financial review take?
One to two hours is typical if the CFO provides a clear, well organized financial package.

Should CEOs dive into the details of every variance?
Only the material ones. Focus on issues that move the business. Let the CFO manage the small items.

What if the numbers look strange or inconsistent?
Ask the CFO to walk you through the source of each variance. Strange numbers usually indicate process or data issues that need fixing.

Do CEOs need to understand accounting?
You do not need to be an accountant. You do need to understand how financial drivers work. That includes margins, working capital, cash flow, and forecasting.

How often should CEOs review cash?
Weekly, not monthly. Cash deserves more frequent attention.

What if your company is very early stage?
The checklist still applies, even if your numbers are small. Early discipline prevents later confusion.

What if my CFO does not provide commentary or insights?
Ask for it. The CFO should interpret numbers, not just report them.

What if I don't have a CFO, or my CFO needs help?
Contact Preferred CFO! We can provide the expertise and assistance you need.

Final Thoughts

A monthly financial review is one of the most powerful habits a CEO can build. It keeps you grounded in reality, reduces surprises, improves decision making, and strengthens the company long before problems surface. With this checklist, you can run a review that goes beyond basic numbers and gives you a complete understanding of the business each month.

Treat the review as a leadership tool. When the CEO sees the whole picture clearly, the entire company benefits.

If you need help with your monthly financial reviews, maybe a fractional or outsourced CFO is the answer. Schedule a free consultation to learn more.