Mexico 2025 accounting close is near. Closing the year is one of the most critical processes for any company operating in Mexico. A timely and well-executed accounting close ensures compliance with Mexican Financial Reporting Standards (NIF), provides reliable financial statements for decision-making, and allows you to anticipate tax obligations for 2026. Below is a detailed checklist of areas you must review to achieve a robust year-end close.
1. Bank Reconciliations
- Ensure all bank accounts are reconciled through December 31, 2025.
- Investigate and clear outstanding deposits in transit or checks not presented.
- Verify that bank charges, interest, and foreign exchange effects are booked.
- Ensure balances match both accounting records and bank statements.
2. Accounts Receivable (AR)
- Aging Analysis: Prepare an AR aging report by customer and invoice.
- Doubtful Accounts Reserve (NIF C-3): Estimate and record an allowance for doubtful accounts based on historical default rates or specific risk assessments.
- Match SAT XML invoices vs. revenue booked in accounting to ensure compliance with CFDI 4.0 requirements.
- Review any credit notes issued and ensure proper linkage to invoices.
3. Accounts Payable (AP)
- Aging of Payables: Classify supplier balances by aging buckets.
- Identify advances to suppliers and ensure correct reclassification (asset vs. liability).
- Review merchandise in transit and ensure proper cut-off of costs and related VAT credits.
- Validate that all supplier XMLs are properly imported and match against expenses/costs recorded.
4. Inventory
- Physical Count: Conduct or validate year-end physical counts.
- Valuation: Apply the cost method (identified, average, or FIFO, as applicable under NIF C-4).
- Aging: Prepare an inventory aging report to detect slow-moving items.
- Reserves:
- Obsolescence reserve for slow-moving or obsolete stock.
- Adjustments for damaged inventory.
- Reconcile inventory sub-ledger with general ledger.
5. Reserves and Provisions
- Warranty Reserves: Record provisions if contractual or statutory obligations exist.
- Vacation and Employee Benefits (NIF D-3): Ensure accruals for vacation, bonuses, and PTU (profit-sharing) are up to date.
- Other Provisions: Litigation, contingencies, and tax exposures must be evaluated (NIF C-9, D-5).
6. Payroll and Employee Obligations
- Confirm December payroll and year-end bonuses (“aguinaldo”) are fully accrued.
- Record IMSS and INFONAVIT liabilities.
- Validate CFDI de Nómina XMLs are correctly issued and booked.
- Reconcile payroll expense vs. liability accounts.
7. Fixed Assets
- Update additions, disposals, and reclassifications.
- Recalculate depreciation in line with NIF C-6 and compare to fiscal depreciation under LISR.
- Ensure impairment testing where required.
8. Revenue Recognition
- Validate that revenue is recognized under accrual accounting principles (NIF D-1).
- Cross-check sales against SAT XML (CFDI) issued.
- Review cut-off at year-end to avoid premature or deferred recognition.
9. Tax Considerations
- Review temporary vs. permanent differences for deferred taxes (NIF D-4).
- Perform preliminary calculation of ISR and VAT for 2025.
- Identify opportunities for fiscal planning before submission of the annual return (March/April 2026 for corporates).
- Ensure DIOT and other SAT filings reconcile with books.
10. Financial Reporting
- Prepare trial balance adjusted for all year-end provisions.
- Prepare comparative financial statements with full disclosure (NIF A-3 and A-5).
- Ensure notes to financial statements cover reserves, contingencies, and related-party balances.
11. Management and Audit Preparation
- Document significant estimates (reserves, provisions, impairments).
- Prepare reconciliations for all key accounts.
- Ensure external auditor requirements are anticipated (legal books, minutes, contracts).
Final Thoughts
Closing the books in Mexico goes beyond a compliance exercise—it is the foundation for tax certainty, strategic planning, and transparent reporting to shareholders. The earlier your finance team starts preparing, the more time you will have to:
- Anticipate fiscal impacts,
- Adjust strategies before deadlines, and
- Provide reliable information for management decisions.
TO disciplined year-end close sets the tone for 2026 and reduces the risk of errors, penalties, or surprises.
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