Once the author and proofreader have the set of proof pages, they start on their respective reviews. This is the author's second official review (the first being post-copyediting), and basically the last chance to make any major changes. It is preferred that the author concentrate on the existing text rather than continuing to rewrite (unless this has been requested by the acquisitions editor), but occasionally that is necessary, and there is still enough time to incorporate and verify additions this early in the process (usually there is still at least two months before the final book is sent to the printer). Both the author and the proofreader are given between three and five weeks to complete this read-through.
Aside from an approval of the general interior layout, the author is also fact-checking any last details, fine-tuning the language, making sure the book reflects what they intend it to, and trimming back sections as needed (especially if the book is running a bit long).
The proofreader is instructed to do another light copyedit from scratch (they may also be asked to do a side-by-side read, which means they look at the copyedited manuscript file simultaneously to verify the proofs). They are looking for the standard grammatical stuff that may have been missed (the copy editors can only catch so much, and sometimes errors are introduced during the author's review of the copyedited manuscript) as well as formatting mistakes, such as an incorrect heading, a word that should be italic, or a chapter name that is misspelled in the table of contents (often designers type them in by hand).
Both the author and the proofreader mark on the printed pages directly (with a colored pen or pencil so it's easy for me to see). Sometimes every page is just covered in red and other times the book is in such good shape that twenty pages at a time are completely error-free (this is a rare and lovely thing, but it always makes me wonder if it has been read closely enough).
Usually I have a pretty good idea of what the author/proofer will catch because I have looked over my copy of the proofs, but I am relying on them to find the things that won't catch my eye immediately (though my education and everyday experience make me a trained and competent proofreader, my attention is devoted to other things the majority of the time).
Once the author and proofreader have completed their reviews, they return them to me so that I can incorporate the changes. If they have dealt with an error differently, I either look up the correct style (in the Chicago Manual) for myself, or go with the proofreader, unless it is a question of preference, in which case I defer to the author's choice. I have both sets of proof pages in front of me (and sometimes my third copy as well, if I have marked anything for correction) and go through them start to finish. I incorporate the changes into the InDesign book file and save this for the designer. (The production manager—who looks at the very technical aspects and ensures compatibility for the printer—prepares a memo for the designer with any requested alterations to the file. I do the same from an editorial perspective and return the corrected file to him/her for what we call second pass proofs.)
I am solely responsible for the book from this point forward. As soon as those proof pages are returned to me, I oversee the rest of the process without a lot of contact from the author because it is assumed that their part in the creation of the book is complete (and for the most part, it is). There will not be any other freelancers involved (except an indexer if the book requires one), so all subsequent reviews are done in-house by me and my managing editor.
What happens after this are my final proof checks, cover design, and the start of publicity... all to come