# Flux analysis with AI: thresholds, examples and drafted explanations

> Run a flux analysis with AI: have it build the formulas in Excel, draft explanations from GL detail, then check them with a planted-error test.

- **URL**: https://www.nocodetalks.co/blog/flux-analysis-with-ai
- **Author**: Ankur Khandelwal, Nocodetalks
- **Updated**: Oct 7, 2026
- **Topic**: Month-end close
- **Sources checked**: 28

---

_A workflow for controllers, CAS teams and fractional CFOs._ Use AI in Excel to build the flux formulas once, draft explanations from GL detail, and test it with planted errors before you trust it.

## The short answer

Export a comparative trial balance from QuickBooks Online or Xero and open it in Excel with an AI add-in: Claude for Excel, Copilot in Excel or ChatGPT for Excel. Have the AI write formulas for the dollar change, percent change and threshold flag, so next month refreshes without it. Then give it GL detail for the flagged accounts only, let it draft explanations that add up to each change, and review every one before sign-off.

> General information, not legal or tax advice. Check the cited rules with your own CPA or attorney before acting.

## What you need before you start

You already know how to run a flux analysis. The AI version needs three things: an AI that works inside your workbook, clean exports, and your rules written down.

| What | Options (as of October 2026) | Notes |
|---|---|---|
| AI in Excel | [Claude for Excel](https://claude.com/docs/office-agents/excel) (Pro, Max, Team, Enterprise). [Copilot in Excel](https://support.microsoft.com/en-us/office/frequently-asked-questions-about-agent-mode-in-excel-1cfd906d-40b4-46be-8e2d-65b893e28a02) (Microsoft 365 Copilot or an eligible plan). [ChatGPT for Excel](https://openai.com/index/chatgpt-for-excel/) (all ChatGPT plans since May 5, 2026). | Use the one your firm has approved. All three can write formulas into the workbook. |
| Comparative TB | QuickBooks Online: Balance Sheet and P&L with **Compare** (Previous period, $ change, % change). Xero: **Compare with**. Or one trial balance export per date. | Export to Excel. Keep account numbers. |
| GL detail | QuickBooks: General Ledger report filtered to the flagged accounts. Xero: Account Transactions report. | Pull it after the flags exist, for flagged accounts only. |
| Your rules | Dollar and percent threshold, AND or OR, always-review accounts, sign convention | Write them once. They go in the prompt, then in a skill. |
| Context | Last month's approved flux, close notes, client emails about known events | Helps the AI match your style and check its own story. |

> Note: Connectors for QuickBooks and Xero exist in Claude and ChatGPT, but they aren't the easy path for flux yet. Xero's Claude connector is read-only. In one CPA's October 2026 test, Intuit's QuickBooks connector reported that it couldn't expose GL transaction detail by account ([Hector Garcia @9:26](https://youtu.be/aGyhYW0TQmE?t=566)). Exports work today.

## The flux analysis workflow, step by step

1. **Put both periods in one workbook.** Paste the prior and current TB into two tabs. Add an Always_Review tab listing cash, suspense, clearing and intercompany accounts.
2. **Make it easy for the AI to read.** Give each period its own clearly named column, add an account-type column, and add an Exclude column for accounts you don't want explained. Shin Financials sets up a template for the AI to fill and uses flag columns instead of prompt instructions ([Shin Financials @10:31](https://youtu.be/shNYNFFCz2g?t=631)).
3. **Ask for formulas, not answers.** In the AI sidebar, run the first prompt below. Excel University's demo shows the payoff: once the variance table is built with formulas, the next period updates without the AI ([Excel University @1:49](https://youtu.be/XnCrjcFxk4Y?t=109)).
4. **Check the formulas yourself.** Click into a few cells. Then use Go To Special, Constants to find typed numbers hiding in formula columns, a check Corporate Finance Institute runs on AI-built models ([CFI @14:38](https://youtu.be/BX2PxxM15Zc?t=878)).
5. **Pull GL detail for flagged lines only.** Filter the QuickBooks General Ledger report (or Xero's Account Transactions report) to the flagged accounts for both months. If QuickBooks can't display it all, Intuit suggests smaller reports by account or period. Paste the result into a GL_Detail tab.
6. **Draft the explanations.** Run the second prompt. Ask for the dollar change first, then the cause. Mike Dion's Copilot finance agent follows the same rule and checks managers' comments against the numbers ([Mike Dion @7:36](https://youtu.be/llRedGPXBCM?t=456)).
7. **Run a reviewer pass, then review it yourself.** Start a new conversation and use the third prompt, so the AI checks the drafts cold. Then you sign off.

Prompt for Claude · Build the flux table with formulas:

```
Tabs [TB_Prior] and [TB_Current] hold trial balances for [Aug 31] and [Sep 30]: account number, name, balance.
1. Build a new tab called Flux using formulas only, no typed values. Match accounts by number. Show prior, current, $ change and % change.
2. Add a Flag column: TRUE when ABS($ change) >= [10,000] AND ABS(% change) >= [10%], or when the account is listed in [Always_Review!A:A].
3. Add check rows proving each TB column nets to zero and every account appears once.
Before writing, list accounts that exist in only one period and ask me how to treat them. Explain each formula in one line.
```

Prompt for Claude · Draft explanations from GL detail:

```
The Flux tab flags [6] accounts. Tab [GL_Detail] has their general ledger lines for [August] and [September].
For each flagged account:
- Start with the $ and % change.
- Group the GL lines that drive it (vendor, JE number, date, amount) and subtotal each group.
- Write one or two sentences on the likely cause. Say whether it looks like timing, a new run rate or a possible error.
- Show anything you can't trace as "Unexplained: $X".
Never state a cause the GL lines don't support. Mark anything you inferred as "Inferred". Put drafts in a new column and don't change any numbers.
```

Prompt for Any AI chat · Reviewer pass before sign-off:

```
Act as the reviewer of this flux. For each draft explanation:
1. Recompute the change from the Flux tab and check that the cited amounts add up to it. Show the math.
2. Check every vendor, JE number and amount against [GL_Detail]. List anything you can't find.
3. Compare with [close notes / manager comments] and flag any place they disagree.
4. Name explanations that could be hiding a misposting, duplicate or cutoff problem, and the document that would confirm the cause.
Return a table: account, ties (yes/no), issues, question for the client. Don't edit the drafts.
```

## Check the output before anyone sees it

- **The TB ties.** Both period columns net to zero and match the exported totals.
- **Three lines recomputed by hand.** The largest flagged line, one balance sheet line, and one you'd have guessed wrong.
- **Each explanation adds up.** The cited amounts sum to the change, and any gap shows as Unexplained.
- **Every cited item exists.** Spot-check two vendors, JE numbers or dates against the GL.
- **Errors stay errors.** A miscoding or duplicate is called an error with a correcting entry. It is never explained away as business activity.
- **Always-review accounts get your eyes.** The flag only catches what your threshold catches.

Don't settle for an AI saying everything looks fine. Shin Financials says a general "review my formulas" request comes back clean while some calculations are still off ([Shin Financials @14:20](https://youtu.be/shNYNFFCz2g?t=860)). Ask for specific checks, like the ones in the reviewer prompt.

> 80% there means we have to audit 100% of the output
> — a commenter working in accounting, on a YouTube video about Claude in finance (2026) (https://www.youtube.com/watch?v=shNYNFFCz2g)

## Test it with planted errors first

Before you use the workflow on a live close, grade it on a month you've already closed and reviewed.

1. **Copy a closed month.** Use a reviewed file so you know the right answers.
2. **Plant four or five errors.** For example: a bill coded to the wrong expense, a duplicate vendor payment, an accrual that didn't reverse, a transposed amount, and a misposting between two balance sheet accounts.
3. **Run the workflow unchanged.** Same prompts, same thresholds.
4. **Score it.** Which errors were flagged as errors? Which got a plausible business explanation instead? The second kind is the dangerous one.
5. **Repeat after changes.** Rerun the test when you change the prompt, the skill or the model.

Demo results vary. Jason Staats planted 10 errors in a tax workbook and Cowork found all 10, in a sponsored video about tax work, not flux ([Staats @11:55](https://youtu.be/5DevfwAfVpA?t=715)). Mike Dion broke two formulas in a cash model. Claude in Excel found one on its first pass and the second only after he said something still looked wrong ([Mike Dion @11:07](https://youtu.be/ksq1ZsNxvwE?t=667)). Nicolas Boucher left mistakes in a bank statement on purpose, and ChatGPT Work flagged them ([Nicolas Boucher @2:31](https://youtu.be/uN57-eyFj3o?t=151)).

## Make it faster next month

- **Let the formulas do the math.** Paste next month's TBs into the same tabs. The changes and flags refresh with no AI involved.
- **Save the explanation step as a skill.** In Claude, a skill is a folder with a SKILL.md file, uploaded under Customize > Skills. Skills work in chat, Claude for Excel, Cowork and Claude Code. Jason Staats suggests doing the job once, then asking Claude to turn it into a skill ([Staats @15:32](https://youtu.be/SAGeq_LTOpg?t=932)). Copilot in Excel also reads custom SKILL.md skills from a OneDrive folder, in English only.
- **Put standing rules in instructions.** Claude for Excel has an Instructions field in its Settings for things like sign conventions and number formats.
- **Keep last month's approved flux as the example.** Shin compares this to briefing a new junior: show them your old work so the output matches how you write ([Shin Financials @8:32](https://youtu.be/shNYNFFCz2g?t=512)).

Prompt for Claude · Turn this month's run into a skill:

```
Turn what we just did into a skill called [monthly-flux]. Include our threshold rule ([$10,000 AND 10%]), the always-review accounts, the sign convention, the explanation format, and the rule that untraced amounts stay visible as Unexplained. It must draft only and never change numbers. Write it so next month I can say "run monthly-flux for [client], [month]". Show me the full SKILL.md and list any assumptions before I save it.
```

Anthropic also publishes official finance skills you can read for structure. Its [finance plugin](https://github.com/anthropics/knowledge-work-plugins/tree/main/finance) includes a variance-analysis skill with a threshold table and an explanation format. Its [Month-End Closer agent](https://github.com/anthropics/financial-services/tree/main/plugins/agent-plugins/month-end-closer) uses a variance-commentary skill that explains each flagged line from the underlying activity. It marks a driver as unclear for the controller instead of inventing one, and it never posts to the GL. Jason Staats found the finance plugin reads like it was written by developers and suggests making your own ([Staats @16:11](https://youtu.be/SAGeq_LTOpg?t=971)). I'd read Anthropic's versions, then write yours around your thresholds and wording.

## Where AI fails in flux analysis

AI is good at grouping GL lines and writing a tidy sentence. That is the risk: a tidy sentence can make a wrong number look explained.

> One month it wrote a beautiful explanation for a variance that was just a misposting
> — a commenter who ran the close for a 12-entity group, on r/Accounting (Sep 2026) (https://www.reddit.com/r/Accounting/comments/1wsxh2r/where_do_you_actually_trust_ai_in_the_monthend/)

What people report
- The same commenter says AI saved them time on the routine part: coding transactions, drafting flux narratives and flagging a rec that didn't tie. They never let it near accruals or cutoff. (a commenter on r/Accounting (Sep 2026), https://www.reddit.com/r/Accounting/comments/1wsxh2r/where_do_you_actually_trust_ai_in_the_monthend/)
- Someone who has automated parts of the close at several clients says bank rules, recurring entries, accrual templates and a threshold flux report hold up. Judgment calls like cutoff and reconciliation exceptions don't. (a commenter on r/Accounting (Sep 2026), https://www.reddit.com/r/Accounting/comments/1wd13dl/ai_automation_to_close_monthend/)
- A skeptic says bank recs have been close to automated for years without AI, and they wouldn't trust a non-deterministic tool with them. (a commenter on r/Accounting (Sep 2026), https://www.reddit.com/r/Accounting/comments/1wsxh2r/where_do_you_actually_trust_ai_in_the_monthend/)
- On a CFO forum, one commenter says AI moved the work around instead of shrinking it. The close didn't get shorter, and review meetings ran longer because AI flagged more variances. (a commenter on r/CFO (Sep 2026), https://www.reddit.com/r/CFO/comments/1wfvuhk/is_ai_actually_freeing_up_finance_teams_or_just/)

AI also only knows what is in the books. A price change agreed on a call or a contract signed last week isn't in the GL, so the draft can't know it. Shin Financials puts AI at about 80% of the way on most tasks, and the rest is your review ([Shin Financials @13:14](https://youtu.be/shNYNFFCz2g?t=794)).

## Keep client data safe

Use a business plan your firm controls, and send the AI only what the step needs: the TB, plus GL lines for flagged accounts. Formulas help here too, because next month's numbers never go to the AI. Claude for Excel deletes inputs and outputs on its backend within 30 days, and its activity isn't in Enterprise audit logs. Anthropic also warns to use it only with trusted workbooks, since outside files can hide prompt injections. The [client data guide](https://www.nocodetalks.co/blog/is-claude-safe-for-client-data) covers the setup.

## Common questions

**Can AI run a flux analysis straight from QuickBooks or Xero?**

Not reliably yet. Both have connectors in Claude and ChatGPT, but Xero's Claude connector is read-only, and in one CPA's October 2026 test Intuit's QuickBooks connector said it couldn't expose GL detail by account. Export the comparison report and the GL detail to Excel instead.

**Which AI is best for flux analysis in Excel?**

Claude for Excel, Copilot in Excel and ChatGPT for Excel can all build formulas inside the workbook. On Reddit, many finance people say they prefer Claude in Excel, but many firms only allow Copilot. Use the one your firm approves, and run the planted-error test on it.

**Can AI write flux explanations a reviewer will accept?**

It can draft them from GL detail: vendors, entries, dates and amounts that add up to the change. It can't know a reason that isn't in the ledger, and it can make an error sound like business activity. A person confirms each cause.

**What threshold should I give the AI?**

Your firm sets it. Use a dollar and a percent level together and name your always-review accounts. One public example: the Texas A&M University System asks members to explain changes over 20% and over $100,000.

**Will AI make the close shorter?**

Not by itself. Some teams report longer reviews because AI flags more. The time savings come from formulas that refresh without AI, a saved skill for the drafts, and a review checklist you trust.

## Sources

- [Use Claude for Excel](https://claude.com/docs/office-agents/excel)
- [Frequently asked questions about Copilot in Excel (edit mode, formerly Agent Mode)](https://support.microsoft.com/en-us/office/frequently-asked-questions-about-agent-mode-in-excel-1cfd906d-40b4-46be-8e2d-65b893e28a02)
- [Skills in Copilot in Excel](https://support.microsoft.com/en-us/excel/copilot/copilot-in-excel-skills)
- [ChatGPT for Excel](https://openai.com/index/chatgpt-for-excel/)
- [Using Skills in Claude](https://support.claude.com/en/articles/12512180-using-skills-in-claude)
- [How to create custom Skills](https://support.claude.com/en/articles/12512198-how-to-create-custom-skills)
- [Finance & Accounting Plugin (knowledge-work-plugins/finance)](https://github.com/anthropics/knowledge-work-plugins/tree/main/finance)
- [Month-End Closer agent and variance-commentary skill (financial-services)](https://github.com/anthropics/financial-services/tree/main/plugins/agent-plugins/month-end-closer)
- [Compare time periods in reports in QuickBooks Online](https://quickbooks.intuit.com/learn-support/en-us/help-article/report-management/compare-time-periods-reports/L1YclAy6H_US_en_US)
- [Fix "The report you are attempting to create may not display..."](https://quickbooks.intuit.com/learn-support/en-us/help-article/report-management/fix-report-attempting-create-may-display/L1T7WEKT5_US_en_US)
- [Balance Sheet](https://central.xero.com/0/article/Balance-Sheet-New)
- [Account Transactions report](https://central.xero.com/0/article/Account-Transactions-report-New-US)
- [Xero connector](https://claude.com/connectors/xero)
- [Intuit QuickBooks connector](https://claude.com/connectors/quickbooks)
- [Intuit QuickBooks plugin and Xero plugin for ChatGPT](https://openai.com/business/plugins/xero/)
- [Work with QuickBooks inside ChatGPT or Claude](https://youtu.be/aGyhYW0TQmE?t=566)
- [Use the Claude AI Add-In to Build Variance Reports in Excel](https://youtu.be/XnCrjcFxk4Y?t=109)
- [1 Month of Claude in Finance](https://youtu.be/shNYNFFCz2g?t=631)
- [Testing Claude in Excel: Building a Three-Statement Financial Model](https://youtu.be/BX2PxxM15Zc?t=878)
- [Copilot Agents Just Replaced My Month-End Close (Here's Proof)](https://youtu.be/llRedGPXBCM?t=456)
- [Why Claude Cowork Is Already Changing Accounting Firms](https://youtu.be/5DevfwAfVpA?t=715)
- [I Tested Claude in Excel on My Messiest Spreadsheet](https://youtu.be/ksq1ZsNxvwE?t=667)
- [How to Use ChatGPT Work in Finance (Tutorial)](https://youtu.be/uN57-eyFj3o?t=151)
- [A Claude Cowork Guide for Accounting Firms (2026)](https://youtu.be/SAGeq_LTOpg?t=932)
- [Flux Analysis (AFR workshop slides)](https://assets.system.tamus.edu/files/budgets-acct/pdf/AFRWorkshop/Day2Flux.pdf)
- [Where do you actually trust AI in the month-end close process? (thread)](https://www.reddit.com/r/Accounting/comments/1wsxh2r/where_do_you_actually_trust_ai_in_the_monthend/)
- [AI automation to close month-end (thread)](https://www.reddit.com/r/Accounting/comments/1wd13dl/ai_automation_to_close_monthend/)
- [Is AI actually freeing up finance teams, or just moving the work around? (thread)](https://www.reddit.com/r/CFO/comments/1wfvuhk/is_ai_actually_freeing_up_finance_teams_or_just/)