The Q1 Close Sprint

Aman Mittal
Aman MittalFebruary 21, 2026

How to Lock in a Clean First Quarter and Set the Tone for the Year

Q1 sets the financial tone for your entire year. Whether you came off a strong Q4 or a slower winter season, how you close the first quarter determines the quality of your forecasts, tax planning, hiring decisions, and growth investments. Strong operators treat Q1 as a formal checkpoint, not just another month-end.

Here’s how to execute a clean, disciplined Q1 Close Sprint, aligned with the Day-5 ⇒ Day-15 workflow used by well-run Canadian businesses.

1. Finish Q4 and Year-End Cleanly Before Finalizing Q1

The most common mistake is carrying unfinished year-end items into the first quarter.

Before you finalize Q1, confirm that:

  • All prior-year expenses are recorded

  • Year-end adjustments are posted

  • Payroll liabilities and remittances are finalized

  • GST/HST balances are reconciled

  • Bank, credit card, and PSP accounts are fully reconciled

If Q4 is messy, Q1 reporting becomes unreliable. And unreliable reporting leads to weak decisions.

Clean year-end books create confidence.

2. Clean Up Accounts Receivable and Accounts Payable

Q1 is the right time to reset your working capital discipline.

Review your AR and AP aging reports:

  • Collect outstanding invoices from Q4

  • Follow up on slow-paying clients

  • Resolve vendor discrepancies

  • Apply credit notes correctly

  • Reconcile deposits against invoices

Cash flow pressure rarely comes from lack of revenue. It usually comes from lack of follow-through.

Healthy cash flow begins with disciplined collections and accurate payables.

3. Build or Refresh Your 13-Week Cash Flow Forecast

A rolling 13-week cash flow forecast gives you visibility before problems show up.

It helps you anticipate:

  • Payroll cycles

  • CRA remittances

  • Vendor payments

  • Inventory purchases

  • Capital expenditures

  • Seasonal slowdowns

Updated weekly, this becomes one of the most powerful forecasting tools in your business.

Without it, you react.With it, you plan.

4. Reinforce Your Day-5 ⇒ Day-15 Close Cadence

Q1 is the moment to reset your financial discipline for the rest of the year.

Your monthly rhythm should look like this:

Day 1–5:
All business inputs delivered

  • Receipts

  • AP updates

  • AR reports

  • Payroll data

Day 6–15:

  • Close the month

  • Reconcile accounts

  • Deliver your Close Pack

  • Review performance

This cadence keeps your numbers actionable instead of delayed and reactive.

Strong operators do not wait until quarter-end to understand performance.

5. Reset Reporting and KPIs for the Year

Q1 is when reporting frameworks should be confirmed and locked in.

For most non-ecommerce Canadian businesses, core KPIs include:

  • Operating expenses as % of revenue

  • Gross margin

  • Net profit margin

  • Cash runway

  • AR turnover

  • AP turnover

If you are not reviewing these monthly, you are flying blind.

Reporting should connect directly to your operating goals. If growth is the priority, your numbers must reflect growth metrics. If margin protection is the priority, your reporting must spotlight cost discipline.

6. Review Contracts, Renewals, and Subscriptions

Many companies accumulate software and service contracts without reviewing ROI.

Q1 is a disciplined moment to:

  • Audit SaaS tools

  • Cancel underused platforms

  • Renegotiate contracts

  • Eliminate duplication

  • Reallocate budget toward revenue-generating activities

Small leaks compound over 12 months.

A quarterly review prevents silent margin erosion.

7. Align Q1 Results With Your Annual Plan

Once Q1 is closed:

  • Compare actual performance against your annual forecast

  • Identify revenue gaps early

  • Adjust hiring or spending plans

  • Update projections

Do not wait until mid-year to correct course.

Q1 tells you whether your plan is realistic or needs recalibration.

Final Thoughts

Q1 is not just another reporting cycle. It is your first serious checkpoint of the year.

A clean quarter-end reduces anxiety, improves forecasting accuracy, and gives your leadership team the clarity required to make confident decisions.

If you want support implementing a disciplined Q1 Close Sprint, Transcounts works with Canadian SMBs to deliver:

  • Bookkeeping

  • Payroll management

  • AP/AR support

  • Cash-flow forecasting

  • Controller-level insight

When your books are clean and your reporting is timely, decisions become easier. And control returns to where it belongs, with you.