Month-end accruals in Excel with Copilot, Claude and ChatGPT: estimate, document, reverse
Month-end accruals are the estimates a controller books for expenses that were incurred during the period but have not yet been invoiced: the utility bill that arrives on the 12th of the following month, the contractor hours already approved in the timesheet system, the goods received at the dock before the supplier invoice, the interest that accrues on a loan every day. Under accrual accounting, US GAAP and IFRS both require these costs in the period in which they were incurred, so the close cannot wait for the paperwork.
AI assistants are useful on the mechanical part of this task. Copilot in Excel, Claude (through the Claude for Excel add-in or file uploads in Claude) and ChatGPT (through data analysis on uploaded spreadsheets) can read a close workbook, apply an estimation method row by row, write the formulas, draft the journal entry and produce a support memo for each line. None of them knows whether a service was actually received, whether a purchase order is still open or whether a legal estimate is reasonable, and all three vendors tell users to verify the output before relying on it.
The workflow below uses a small illustrative October 2026 close with six accruals totalling $48,040, gives the prompts, shows the expected result computed independently, and lists the checks a reviewer should run before the entry is posted. Product requirements were verified on the vendors' official documentation on November 12, 2026.
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WHAT A MONTH-END ACCRUAL SCHEDULE HAS TO CONTAIN.
An accrual schedule is the working paper behind the accrual journal entry. Each line identifies the vendor or cost type, the GL account to debit, the liability account to credit, the estimation method, the inputs used and the person who supplied or approved them. Auditors test this file because accruals are judgemental by nature, and the year-end version gets the most attention. The broader accounting treatment, with the standard journal entries, is covered in accrued expenses: accounting treatment, journal entries and examples.
Most finance teams use four or five estimation methods. Recurring services with variable bills, such as utilities, are often estimated with a trailing average of recent invoices. Time-based services, such as contractors, use approved hours multiplied by the contract rate. Goods received not invoiced (GRNI) use the quantity received multiplied by the purchase order price. Interest is computed from the loan balance, the rate and the day-count convention in the loan agreement. Professional fees, legal fees in particular, usually rely on an estimate requested from the provider.
The schedule also needs a materiality threshold, so that small items are not accrued line by line, and a reversal policy. Most teams book accruals as auto-reversing entries: the October accrual reverses on November 1, and the actual invoice is then recorded normally when it arrives. The comparison between the reversed accrual and the actual invoice is the best evidence of how good the estimates are.
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COPILOT IN EXCEL, CLAUDE FOR EXCEL AND CHATGPT: DOCUMENTED REQUIREMENTS.
The three tools reach the workbook in different ways. Copilot and Claude for Excel work inside Excel on the open file, while ChatGPT and Claude in the chat interface work on an uploaded copy and return a new file. The table summarizes what each vendor documents.
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Tool | Access documented by the vendor | File and platform notes | Vendor caution |
Copilot in Excel | Microsoft 365 Premium, Personal or Family with an AI credits plan, a commercial Copilot subscription, or an eligible business or enterprise plan | Modern format such as .xlsx; edit mode needs Automatic calculation; Windows, Mac and web | Review, edit and verify output; avoid it for sensitive finance decisions |
Claude for Excel | Pro, Max, Team and Enterprise plans | Excel on the web, Windows (Microsoft 365) and Mac builds listed; no data tables, macros or VBA | Not for audit-critical calculations without verification |
Claude file creation | All plans, Free to Enterprise | Creates .xlsx files; 30MB per file for uploads and downloads | Review and refine outputs |
ChatGPT data analysis | Plans not listed on the help page | .xls, .xlsx and .csv; about 50MB for spreadsheets; up to 10 files per conversation | No accuracy statement on the page |
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Microsoft's Copilot in Excel FAQ, last updated October 12, 2026, says Copilot "can make mistakes" and advises users to "avoid using Copilot for decisions in sensitive areas such as finance". An accrual entry is a finance decision, so Copilot's role here is preparation: formulas, structure and a first draft of the support, with the controller deciding the amounts.
Anthropic's Claude for Excel documentation states that answers include cell-level citations and that the add-in keeps formula relationships intact when it changes values. It lists "audit-critical calculations without verification" among the uses it does not recommend, and it warns against running the add-in on spreadsheets from external sources because hidden instructions in a file can manipulate it. Vendor statements and supplier files imported into the close workbook fall into that category.
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ILLUSTRATIVE OCTOBER 2026 ACCRUAL DATASET.
The dataset below is illustrative. It represents what an accountant typically collects before the close: invoice history, approved timesheets, receiving reports, the loan agreement and a provider estimate. The materiality threshold is $1,000 per item.
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Item | Method | Inputs |
Utilities | 3-month average of invoices | Jul 4,120; Aug 4,380; Sep 4,250 |
Contract labor | Approved hours x rate | 168 hours at $85 |
GRNI inventory | Units received x PO price | 960 of 1,200 units at $12.50 |
Loan interest | Balance x rate / 12 | $600,000 at 7.2%, 30/360 basis |
Legal fees | Provider estimate | $9,500 per email from counsel |
Freight-out | Deliveries x rate card | 14 deliveries at $315 |
Office supplies | Below threshold | $640, not accrued |
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The same layout works in a real close file with one row per vendor and separate columns for each input, so that formulas reference cells instead of hard-coded numbers. Keeping inputs separate from formulas is what allows a reviewer, or an AI assistant asked to explain the workbook, to trace every amount back to its source.
The formulas for the illustrative rows are ordinary Excel functions. A reviewer should expect formulas of this kind in the workbook rather than pasted values:
Utilities: =ROUND(AVERAGE(C2:E2),2)
Contract labor: =C3*D3
GRNI inventory: =C4*D4
Loan interest: =ROUND(C5*D5/12,2)
Threshold flag: =IF(F8<1000,"Below threshold","Accrue")
Schedule total: =SUMIFS(F2:F8,G2:G8,"Accrue")··········
PROMPTS FOR BUILDING THE ACCRUAL SCHEDULE WITH AI.
The prompts work in Copilot in Excel and Claude for Excel on the open workbook, and in ChatGPT or Claude after uploading a copy. Naming the method, the threshold and the output format reduces the room for the model to improvise.
In the sheet "Oct accruals", add a column F "Accrual amount" that applies
the method in column B to the inputs in columns C to E. Use formulas that
reference the input cells, not typed values. Round to 2 decimals.
Add column G that flags rows below $1,000 as "Below threshold".
Do not change any input cell. List every formula you wrote.Using the accrual schedule in "Oct accruals", draft the October 31, 2026
accrual journal entry. Debit the expense or inventory account in column H,
credit Accrued liabilities for services, Accrued GRNI for inventory
receipts and Accrued interest payable for interest. Show debits and
credits in separate columns and confirm that total debits equal total
credits. Mark the entry as auto-reversing on November 1, 2026.For each accrued row, write a two-sentence support note: the evidence
used (invoice history, timesheet approval, receiving report, loan
agreement, provider email) and the calculation. Put the notes in column I.
If any input is missing, write "Input missing" instead of estimating.The last instruction in the third prompt is a control. Language models fill gaps when asked for a complete output, and an accrual schedule with an invented input is worse than one with a visible blank.
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EXPECTED RESULT: THE OCTOBER ACCRUAL ENTRY.
The amounts below were computed independently in Python from the illustrative inputs, so the AI's output can be checked line by line. Six items are accrued; office supplies stay out because $640 is below the threshold.
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Item | Calculation | Accrual (USD) |
Utilities | (4,120 + 4,380 + 4,250) / 3 | 4,250.00 |
Contract labor | 168 x 85 | 14,280.00 |
GRNI inventory | 960 x 12.50 | 12,000.00 |
Loan interest | 600,000 x 7.2% / 12 | 3,600.00 |
Legal fees | Provider estimate | 9,500.00 |
Freight-out | 14 x 315 | 4,410.00 |
Total | 48,040.00 |
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The journal entry splits the credit across three liability accounts so that GRNI and interest can be reconciled separately from service accruals.
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Account | Debit (USD) | Credit (USD) |
Utilities expense | 4,250.00 | |
Contract labor expense | 14,280.00 | |
Inventory | 12,000.00 | |
Interest expense | 3,600.00 | |
Legal fees expense | 9,500.00 | |
Freight-out expense | 4,410.00 | |
Accrued liabilities | 32,440.00 | |
Accrued GRNI | 12,000.00 | |
Accrued interest payable | 3,600.00 | |
Total | 48,040.00 | 48,040.00 |
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Two details are frequent sources of AI errors on this entry. The GRNI amount should be based on the 960 units received, not the 1,200 units ordered, which would overstate the liability by $3,000. The interest line uses the 30/360 convention stated in the illustrative loan agreement; an actual/360 calculation on 31 days would give $3,720, so the prompt or the workbook should state the convention. Drafting and checking entries before posting is covered in more detail in journal entries with Copilot, Claude or ChatGPT.
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CHECKING PRIOR-MONTH ACCRUALS AGAINST ACTUAL INVOICES.
The reversal of the September accruals on October 1 creates the data needed to test estimation quality. When the actual invoices arrive, the difference between the accrual and the invoice shows which methods are reliable. This comparison is a good task to hand to an AI assistant, because it is a lookup and subtraction exercise on two tables that the reviewer can verify quickly.
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Item | Sep accrual (USD) | Actual invoice (USD) | Difference (USD) | Difference % |
Utilities | 4,300 | 4,410 | 110 | 2.6% |
Contract labor | 13,600 | 13,600 | 0 | 0.0% |
Legal fees | 8,000 | 11,250 | 3,250 | 40.6% |
Freight-out | 3,780 | 3,612 | -168 | -4.4% |
Total | 29,680 | 32,872 | 3,192 | 10.8% |
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In the illustrative data, the formula-based methods land within a few percent, while the provider estimate for legal fees was 40.6% below the actual bill. That result points the controller to the October legal estimate of $9,500 as the line to challenge, for example by asking counsel for hours worked to date rather than a single figure. A prompt for this step can ask the assistant to "flag any item where the actual invoice differs from the accrual by more than 10% and list it first", which turns the comparison into a review list.
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REVIEW CONTROLS FOR AI-PREPARED ACCRUALS.
The AI output is a draft working paper. The following checks keep the controller in charge of the numbers:
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Check | What to verify |
Inputs | Every input cell matches its source document; no input was typed by the AI |
Formulas | Each amount is a formula referencing inputs; recompute two lines by hand |
Completeness | Open POs with receipts, approved timesheets and recurring vendors all appear |
Threshold | Items below $1,000 excluded consistently; no splitting of larger items |
Accounts | Inventory receipts go to inventory, not expense; interest to interest expense |
Balance | Total debits equal total credits; liability split matches the schedule |
Reversal | Entry is set to auto-reverse on the first day of the next period |
Approval | Preparer and reviewer are different people; judgemental lines signed off |
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Completeness is the control AI handles worst, because the assistant only sees the rows it is given. An accrual that is missing from the schedule cannot be caught by checking the schedule; it is found by reviewing open purchase orders, recurring vendors with no invoice in the period, and subsequent disbursements in the first weeks of the next month. The same search for unrecorded liabilities is the core of the year-end procedures described in year-end close under US GAAP: cut-off, accruals and adjusting entries.
Legal accruals need a separate judgement. Fees for services already performed are an ordinary accrued expense. A possible loss from litigation is a contingency assessed under ASC 450 or IAS 37, with its own probability and measurement criteria, and it should not be folded into the monthly fee accrual by an AI-generated formula.
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DATA HANDLING FOR ACCRUAL WORKBOOKS IN COPILOT, CLAUDE AND CHATGPT.
Close workbooks contain vendor names, contract rates and sometimes payroll data, so data handling deserves a check before the first prompt. Microsoft states that changes saved by Copilot are visible to anyone with access to the file, including coauthors, and that Copilot in Excel is part of Copilot Chat, so it follows the organization's Copilot Chat admin settings and cannot be turned off separately.
Anthropic documents that Claude for Excel sends conversations to Anthropic, including the content Claude reads from the workbook, that inputs and outputs are deleted on the backend within 30 days except in listed cases, and that chat history is stored locally in the browser. The add-in does not inherit custom data retention settings and its activity is not included in Enterprise audit logs, although Enterprise organizations with the Compliance API enabled get Claude for Excel sessions in that API. For file creation in Claude, Team and Enterprise owners can disable the feature, and the default network access differs by plan.
OpenAI's data analysis help page states that the code execution environment of a conversation is destroyed within 13 hours of the conversation becoming inactive. Teams should confirm their workspace's data controls in ChatGPT before uploading close files. Bank reconciliation and the rest of the close checklist follow the same handling rules, as discussed in month-end close with Copilot in Excel, Claude and ChatGPT.
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MONTH-END ACCRUALS WITH AI: WHAT THE TOOLS DO WELL AND WHERE JUDGEMENT STAYS HUMAN.
Copilot in Excel, Claude for Excel and ChatGPT can each take an accrual schedule from raw inputs to formulas, a balanced journal entry and support notes in a few prompts, provided the method, threshold and day-count convention are stated in the workbook or the prompt. On the illustrative October data the correct entry is $48,040, split into $32,440 of accrued liabilities, $12,000 of accrued GRNI and $3,600 of accrued interest, and any AI output can be checked against those figures.
The estimates that depend on judgement, such as the legal fee accrual that missed by 40.6% in September, the completeness of the population and the line between an accrued fee and a litigation contingency, remain with the accountant and the reviewer. All three vendors document that their output must be verified, and Anthropic and Microsoft specifically caution against relying on unreviewed results for audit-critical or finance decisions, so the approval step stays human.
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