I reviewed the December accruals file: 16 accruals totalling $133,234.98, up $36,370 (+37.5%) on November's $96,864.95.

| Account | Dec | Nov | Change |
|---|---|---|---|
| 2100 Accrued expenses | 90,533.68 | 65,662.70 | +24,870.98 |
| 2110 Accrued freight | 42,701.30 | 31,202.25 | +11,499.05 |

The file has no GL trial balance, so I couldn't tie these totals to the ledger. That still needs doing.

## Items to resolve before close

1. **AC-14 Coastline fuel surcharge, $6,310.20: the invoice has already been received.** The invoice is marked as received and the supporting reference is the carrier's invoice itself. If it has been entered in AP, this accrual counts the cost twice. Reverse it, or confirm the invoice isn't posted yet. Also check whether AC-13, the main Coastline freight accrual, was billed on that same invoice.

2. **AC-01 Harlow and Finch legal, $12,500: possibly out of date.** It's an estimate that has stayed at exactly $12,500 for 7 months. It doesn't reverse, no invoice has arrived, and there's no evidence it has been updated. Get a current estimate from counsel on fees incurred through 12/31 for the lease dispute. At year end, also check whether the dispute itself needs a contingency disclosure or provision, separate from the legal fees.

3. **AC-07 Lanternfly Creative, $5,400: no support.** It's marked as PO-based but has no PO or other supporting reference. It has also been flat for 2 months with no invoice. Confirm the "first milestone" was actually delivered by 12/31 and get the PO.

4. **AC-06 Summit Facility Services racking repair, $7,600: new, and based only on a PO.** A PO alone doesn't create a liability. Confirm the work was done by 12/31. Also check whether it's a repair (expense) or a capital improvement, since the cost is round and the work followed a safety inspection.

5. **AC-16 Tallgrass inbound freight, $6,330 (+121%): check the posting account.** Inbound freight on inventory receipts is normally added to inventory cost, not expensed. With large pre-buy receipts at year end, posting it to freight expense would overstate December expense and understate inventory.

## Large increases that look reasonable but should be checked

- **AC-02 Brightline Audit, $18,000 (+100%):** the note says a second interim visit took place in December. Tie the amount to the fee schedule in the audit engagement letter.
- **AC-05 Palmetto Staffing, $9,842.60 (+134%):** this fits the year-end receiving volume. Tie it to the December timesheets and bill rates.
- **AC-11 Kingsley CAM charges, $6,750 (+46%):** open for 3 months and based on the landlord's estimate. Confirm the Q4 estimate and whether the amount is cumulative for the quarter or for one month.
- **AC-13 and AC-15 freight, up 25% and 37%:** these are in line with the pre-buy volume. The fuel surcharge is about 33.9% of base freight in both months, which is consistent.

## No issues

AC-03, AC-04, AC-08, AC-09, AC-10 and AC-12 are recurring items with small month-over-month changes and proper support.

**Net:** at least $6,310 should probably come out (AC-14). Another $31,830 (AC-01, AC-06, AC-07, AC-16) needs support or a decision on classification before sign-off.