General Ledger Year End Closing
In any accounting system, account balances are tracked on a year-to-date basis. Each fiscal year the tracking of year-to-date balances must start fresh. This means General Ledger transactions must be made to reverse the balances of each Income Statement account, bringing their respective balances to zero.
The accounting system provides a program for automatically creating a Batch of transactions to zero these balances. The system finds the account balance for each Income Statement account, and creates a Batch of reversing entries. The offsetting entry (this year’s profit or loss) is sent to the Retained Earnings account in the Balance Sheet. This transaction Batch can then be proof listed, edited and posted as a normal G/L transaction Batch. Note: The Batch that this program creates must be posted through G/L transaction entry for the Year End Closing process to be completed.
After selecting the Year End Closing option from the General Ledger Main Menu, the following screen will come into view.
Year End Fiscal Period Closing Transactions Will Be Posted To
Enter the fiscal period to which the Batch of reversing transactions should be posted. This is generally a fiscal period labeled Year End, and should be the period immediately following the last period of the fiscal year.
GL Transaction Batch
Press the lookup button and the Batch Management screen comes into view. Highlight the desired Batch and press the Select button.
Transaction Date
Press the lookup button and the Calendar will come into view. Highlight the desired dated and press the Select button.
Maintain Cost to Date in Control Accounts
The system can automatically maintain the balance between the job control accounts and the totals in the job cost module. This is accomplished by posting the reversing entry for job control account not to the account itself, but to its associated Prior Year account. If this box is checked, the system will generate a transaction to the prior year account and leave the total in the control account untouched.
Explanation (button)
Press the Explanation button to see a description of what will happen if the Maintain Cost to Date in Control Accounts check box is checked during year end closing. The following screen will come into view.
Confirm the above information by pressing the OK button. The system will now create the Batch of transactions and return immediately to the main menu.