Financial analysis skill for AI agents. Covers variance analysis, cash flow forecasting, month-end close automation, CFO commentary generation, 13-week cash flow dashboards, budget vs actual analysis, and financial statement review. Built by accounting professionals for agents that need to produce defensible financial outputs. Do NOT use for tax preparation, audit opinions, or regulatory filings — those require specialized compliance skills.
SKILL.md
Financial Analysis Agent
A comprehensive financial analysis skill that enables AI agents to produce defensible, CFO-ready financial outputs. Every technique here is grounded in standard accounting practice (US GAAP / IFRS compatible) and designed for agents operating on real financial data.
When to Use
Monthly/quarterly financial close cycles
Variance analysis on budget vs actual results
Cash flow forecasting and 13-week rolling dashboards
Generating CFO commentary and board-ready narratives
Ratio analysis for lending covenants or investor reporting
AR/AP aging analysis and collections prioritization
Bank reconciliation pattern matching
When NOT to Use
Tax return preparation or tax advisory (use a tax compliance skill)
Audit opinions or attestation work (requires human CPA sign-off)
Regulatory filings (SEC, state filings — requires compliance review)
Valuation work (DCF, comps — requires a valuation-specific skill)
Payroll processing or HR-related financial work
1. Variance Analysis Methodology
Variance analysis decomposes the difference between budget and actual into price, volume, and mix components.
Price Variance
Measures the impact of actual price differing from budgeted price, holding volume constant.
Invoice Terms Collection Pattern
─────────────────────────────────────
Net 30 Month 1: 15%, Month 2: 70%, Month 3: 12%, Bad debt: 3%
Net 15 Month 1: 80%, Month 2: 17%, Bad debt: 3%
COD Month 1: 97%, Bad debt: 3%
Forecast Accuracy Tracking
Every week, compare last week's forecast to actual:
Forecast Accuracy = 1 - |Actual - Forecast| / |Forecast|
Target: >90% accuracy on 1-week forecast, >80% on 4-week
Red Flags
Closing cash below minimum balance requirement in any week
Three consecutive weeks of declining cash
Collections falling below 85% of forecast
Concentration: any single customer >25% of weekly inflows
3. Month-End Close Checklist
A disciplined 10-step close process. Target: complete within 5 business days of month-end.
The 10 Steps
Step Task Owner Day Verification
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1 Cut off AR/AP AR/AP D+1 Last invoice # matches
2 Bank reconciliation Cash D+1 All items <30 days
3 Record accruals GL D+2 Accrual schedule signed
4 Record depreciation/amortization GL D+2 Fixed asset register ties
5 Intercompany eliminations GL D+3 IC balances net to zero
6 Revenue recognition review Rev D+3 ASC 606 checklist complete
7 Inventory/COGS reconciliation Ops D+3 Physical vs book <2%
8 Prepare trial balance GL D+4 Debits = Credits
9 Variance analysis FP&A D+4 All material items explained
10 Management review & sign-off CFO D+5 Signed close package
Accrual Checklist
Common accruals that get missed:
Payroll accrual (days worked but not yet paid)
Bonus accrual (pro-rata for period)
Interest accrual on debt
Utility accruals
Professional services received but not invoiced
Insurance amortization
Prepaid expense amortization
Deferred revenue recognition
Journal Entry Standards
Every journal entry must include:
Date
Debit account(s) with amount
Credit account(s) with amount
Description/memo explaining the entry
Supporting documentation reference
Preparer and approver
Example:
Date: 2026-02-28
DR 6100 - Professional Services $15,000
CR 2100 - Accrued Expenses $15,000
Memo: Accrue Feb legal fees per engagement letter #2026-041
Support: Email from counsel confirming Feb activity
Prepared: Agent | Approved: [CFO Name]
4. CFO Commentary Templates
CFO commentary answers three questions: What changed? Why? What should we do?
Revenue Commentary Template
## Revenue: $X.XM vs Budget $X.XM (↑/↓ X.X%)
**What changed:**
- [Product/Service line] revenue was $XXK [above/below] budget
- [Volume/Price/Mix] was the primary driver
**Why:**
- [Root cause — be specific: lost customer, delayed deal, new contract, seasonal]
- [Secondary cause if applicable]
**What to do:**
- [Action item 1 with owner and deadline]
- [Action item 2 with owner and deadline]
**Outlook:**
- [Forward-looking statement for next period]
- [Risk/opportunity to flag]
Expense Commentary Template
## Operating Expenses: $X.XM vs Budget $X.XM (↑/↓ X.X%)
**What changed:**
- [Expense category] was $XXK [over/under] budget
- [One-time vs recurring classification]
**Why:**
- [Root cause — hiring timing, vendor price increase, project delay, etc.]
**What to do:**
- [If over: mitigation plan or approval to exceed]
- [If under: whether savings are permanent or timing]
Cash Position Commentary
## Cash Position: $X.XM (↑/↓ $XXK from prior month)
**Key movements:**
- Operating cash flow: $XXK [positive/negative]
- Collections: $XXK received vs $XXK billed (XX% collection rate)
- Major payments: [List any >$25K individual payments]
**Liquidity outlook:**
- Runway: XX months at current burn rate
- Covenants: [In compliance / approaching threshold]
- Next major cash event: [Date and description]
