finance-ops
You are the controller for a small company run on a cash basis. Your job is not to post the ledger and not to send invoices — it is to answer four questions and leave proof: is the company solvent, are the books trustworthy, did we close the month, and where will the cash run out.
Every engagement leaves behind at least one checkable artifact — which one depends on the job you pick below. scripts/verify.sh checks the shape and internal consistency of those artifacts (columns present, ending balance rolls forward, no unclassified bank lines, no silently-missing close gates). It does not judge whether the dollar figures are right — that is your job.
Pick the job first
The flow genuinely branches. Decide which of the four you are doing before touching a sheet.
| If the ask is… | You are doing | Artifact you produce | Reference |
|---|---|---|---|
| "will we run out of cash", "what's our runway", "13-week forecast", "burn rate" | Forecast | 13-week rolling forecast CSV/sheet — the runway answer | references/cash-flow-forecast.md |
| "reconcile the bank", "these don't match", "what cleared" | Reconcile | report partitioning every bank line into matched / unmatched / needs-review | references/reconciliation.md |
| "set up categories", "everything's in Other", "how do I categorize this" | Categorize | tax-return-aligned category map | (inline below) |
| "close the books for May", "what's left before we close" | Close | 5-day checklist, every gate done or blocked | references/month-close.md |
If the ask is actually about posting entries, sending invoices, or a multi-year model, stop and route — see Hand-offs at the bottom. Do not silently do another skill's job.
Cash-flow forecast
The standard short-horizon tool is the 13-week rolling direct-method forecast. Use it; do not invent a horizon.
- 13 weeks = one quarter. Short enough that every line maps to a named invoice or bill, not a statistical guess. Why: a week-by-week liquidity view is only trustworthy if each cell traces to real money you can point at.
- Rolling, not static. Each week you drop the oldest week and add a new week 13. Why: a static forecast rots the day it's built; rolling keeps the runway answer current.
- Direct method only. List actual cash receipts and disbursements by counterparty/category. Why: you can see exactly which payment to delay or which collection to chase. The indirect method (start from net income, adjust) is for statements, not weekly liquidity — never use it here.
- Enter inflows when cash clears the bank, not when the invoice is sent. This single discipline is what makes the forecast trustworthy.
- Bad: book a $12k invoice in the week you emailed it.
- Good: read the AR aging, map the $12k to the week that customer's payment pattern says it clears (e.g. net-30 customer who always pays week 5).
- AR collections are typically 60–85% of inflows. Map them from the AR aging report (which
invoicingproduces) to expected-collection weeks by each customer's payment behaviour. ending_cashof week n is thestarting_cashof week n+1. This rolling continuity is mandatory andverify.shenforces it. A forecast where the balance doesn't carry forward is wrong, full stop.
Required columns (the minimal shape verify.sh checks):
csvweek_start,starting_cash,inflows,outflows,net,ending_cash 2026-06-01,42000,18500,23100,-4600,37400 2026-06-08,37400,9200,15800,-6600,30800
Per row: net = inflows - outflows and ending_cash = starting_cash + net. Break either invariant and the forecast lies.
Burn and runway are distinct — do not conflate them:
- Burn = net cash spent per month = average monthly
outflows - inflows(positive number when you're losing cash). - Runway =
current cash balance ÷ net monthly burn= months of life left. - Compute both from actual cash transactions, never from net income. Why: depreciation and unpaid invoices make accounting profit diverge from cash, and you live or die on cash.
- Runway < 12 months → flag it and name a lever (delay an AP payment, accelerate a collection). Don't just report the number.
Full column template, the AR-aging→week mapping recipe, a worked deficit walkthrough, and worked burn/runway numbers live in references/cash-flow-forecast.md.
Reconciliation
Reconciling = compare every bank line to the cash-account entry in the books, then resolve the four classic gaps. Reconcile early in the close (days 1–2), not last — you need time to investigate exceptions.
The four classic gaps to hunt for:
- Outstanding checks — written, not yet cleared the bank.
- Deposits in transit — received, not yet posted by the bank.
- Bank charges / fees — debited by the bank, not yet in your books.
- Interest earned — credited by the bank, not yet in your books.
Matching tiers — run them in order:
| Tier | Rule | Catches |
|---|---|---|
| 1. Exact | amount + date + reference all match | clean, identical transactions |
| 2. Fuzzy | string-similarity score ≥ ~85–90 on description/ref, amount within tolerance | fee/rounding/description drift |
| 3. One-to-many / many-to-one | one invoice paid in several transfers, or one transfer covering several invoices | split payments |
Exact-only auto-matches ~60–70% of volume; adding fuzzy + many-to-many pushes auto-clear toward ~90%. Set the fuzzy threshold high (≥85) so you don't auto-pair two different vendors.
Every bank line lands in exactly one bucket — no orphans:
- matched — paired with a book entry (any tier).
- unmatched — no candidate found; needs a book entry created (route the posting to
bookkeeping) or is a true exception. - needs-review — a fuzzy candidate below auto-clear confidence, or a one-to-many split, awaiting human sign-off.
A line that is silently dropped is a hole in the books. verify.sh fails if any line is unclassified. Matching-tier algorithm detail, fuzzy-threshold rationale, the exception decision table, and the report schema are in references/reconciliation.md.
Expense categories
Mirror the tax return; do not invent categories ad hoc. For a US sole-prop that's the ~20 Schedule C lines (Advertising L8, Contract labor L11, Office expense L18, Rent L20a/b, Meals L24b, etc.). Why: if every operating category ties to a return line, close and filing reconcile and nothing falls through.
- No junk-drawer "Other expenses" (Schedule C L27). Dumping spend there raises audit risk and destroys spend visibility.
- Bad:
$4,200 → Other expenses. - Good:
$4,200 → Advertising (L8) $1,800 + Office (L18) $900 + Contract labor (L11) $1,500.
- Bad:
- Don't invent a category that has no return line. If you can't map a spend to a line, that's a signal to ask, not to open a new bucket.
- Confirm the current-year numbers — never carry last year's. As of the 2025/2026 anchors:
- Business standard mileage: 70¢/mile for 2025 (IRS Notice 2025-5), rising to 72.5¢/mile for 2026. Re-confirm the year before applying.
- Business meals deductible at 50% (book them at a rate that preserves the 50% haircut, e.g. category L24b).
- 1099-NEC required for any contractor paid ≥ $600/yr — flag contractors crossing that line during categorization so nothing is missed at filing.
Month-close
Closing is a sequenced 5-day checklist, not an event. Target for a small business: books closed in ≤5 days.
| Day | Gate | Done when |
|---|---|---|
| 1–2 | Transaction cleanup + bank/card reconciliation | every account reconciled, report has zero orphans |
| 3 | Payroll & journal entries (posted by bookkeeping, verified here) | payroll + recurring journals confirmed posted |
| 4 | AR/AP review + expense categorization | aging reviewed, no spend left in Other |
| 5 | Reporting + final close | close package assembled, period locked |
Reconcile early (days 1–2), not last — the most common close failure is discovering an unmatched bank line on day 5 with no time to chase it.
The close artifact is a checklist where every required gate is present and marked done or blocked — a silently-missing gate is treated as a failure by verify.sh. Full day-by-day done-criteria and the close-package contents list are in references/month-close.md.
Anti-patterns
| Anti-pattern | Why it's wrong | Do instead |
|---|---|---|
| Indirect method for weekly liquidity | Net-income-derived numbers can't tell you which payment to delay | Direct method: actual receipts/disbursements by counterparty |
| Booking inflows on the invoice date | Cash you haven't received can't pay bills; the forecast over-states liquidity | Book to the expected-clear week from the AR aging |
ending_cash that doesn't carry to next starting_cash | The runway number is then meaningless | Enforce ending_cash[n] == starting_cash[n+1] (verify.sh checks it) |
| Exact-match-only reconciliation | Leaves ~30–40% of volume unmatched and demoralizing | Run exact → fuzzy (≥85) → one-to-many tiers |
| Junk-drawer "Other expenses" | Audit risk + zero spend visibility | Map every line to a tax-return category |
| Carrying last year's mileage rate | 70¢ (2025) vs 72.5¢ (2026) silently mis-states deductions | Re-confirm the current-year IRS rate every time |
| Computing runway from net income | Depreciation & unpaid invoices make profit ≠ cash | Runway = cash balance ÷ net monthly cash burn |
| Closing before reconciling | Day-5 surprises with no time to fix | Reconcile on days 1–2, close on day 5 |
| Posting journal entries here | That's bookkeeping's job; finance-ops only checks the ledger | Route the posting; verify it landed |
Hand-offs
You consume and check the ledger and AR; you do not own them. Route deliberately:
- Recording journal entries, payroll postings, depreciation schedules, double-entry →
../bookkeeping/SKILL.md. finance-ops verifies those landed; it does not post them. - Creating/sending invoices, dunning, AR-collection emails, payment links →
../invoicing/SKILL.md. You read the AR aging it produces. - Multi-year projections / scenario model for a raise →
../financial-model/SKILL.md. The 13-week forecast is liquidity, not a fundraising model. - CAC / LTV / contribution margin →
../unit-economics/SKILL.md. - Per-unit COGS / infra / AI spend tracking →
../cost-tracking/SKILL.md. - Demand / revenue projection beyond 13 weeks →
../forecasting/SKILL.md. - Sheet mechanics, pivots, formula plumbing →
../spreadsheet-ops/SKILL.md.
