Close Income Statement
At the end of each financial year, the balances of the P&L Statement must be transferred to the balance sheet. This is done using the Close Income Statement batch job.
The process of closing operations of the accounting period is divided into two stages:
Note
The financial period can only be closed for a closed accounting period.
To close an accounting period:
- Choose the
icon, enter Accounting Periods, and then choose the related link. - Select a required period from the list.
- Select Actions > Close Year. Re-opening a year after it’s been closed is impossible.
Closing P&L Account to financial result
On the G/L account card, there is an additional setting in the Closing Debit Account and Closing Credit Account fields, which allows you to determine which accounts of financial results profits and losses will be debited to.
Using the Close Income Statement batch job with the Calculate Retained Earnings (losses) option enabled, the system searches for a G/L account with the Profit and loss account type, as well as with the above setting, in which the balance for the selected accounting period is not zero. Depending on the value, the system posts the profit or loss to the account set on the card, while creating lines in the financial journal, which are subsequently posted. Thus, the balance of the selected P&L accounts becomes zero.
To close a P&L account for financial result:
- Choose the icon, enter Close Income Statement, and then choose the related link.
- On the Options FastTab, fill out the fields listed in the table below:
| Field | Description |
|---|---|
| Fiscal Year Starting Date | Enter the accounting period start date. |
| Fiscal Year Ending Date | Enter the accounting period end date. |
| Gen. Journal Template | Select the general journal template with which entries will be created and posted. |
| Gen. Journal Batch | Select the batch of the general journal with which the entries will be created and posted.. |
| Document No. | Is filled out automatically according to the set number series of the selected section of the general journal. Can also be filled out manually. |
| Posting Description | Enter information to describe entries to be created with the report. |
| Calculate Financial Results | Enable this option if you need to close P&L accounts to the financial result account. |
| Preview posting | Enable this option if you want to preview entries. Is available if there is an Additional Reporting Currency setting, because with this setting, the system creates journal entries and automatically posts them. If there are no additional reporting currency settings, the entries will not be automatically posted, but the corresponding entries will be created in the financial journal. |
| Business Unit Code | Enable this option if you want to create entries for each branch on the G/L account. If the option is disabled, one entry will be created for each G/L account. |
| Dimensions | Set the dimensions and their values that will be assigned to the generated entries. |
Inventory Period Closed | This field specifies that inventory periods with end dates equal to or greater than the last dates of the accounting period are closed. 3. Click ОК to run the periodic job.
Closing the P&L Statement
On the G/L account card, there is an additional setting in the Close on Retained Earnings/Losses field. Accounts with this option enabled will be closed to the accounts specified in the Unrealized Gains Acc., Unrealized losses Acc. on the Financial Period Closing page depending on the value.
To close a P&L statement:
- Choose the icon, enter Close Income Statement, and then choose the related link.
- On the Options FastTab, fill out the fields listed in the table below:
| Field | Description |
|---|---|
| Fiscal Year Starting Date | Enter the accounting period start date. |
| Fiscal Year Ending Date | Enter the accounting period end date. |
| Gen. Journal Template | Select the general journal template with which entries will be created and posted. |
| Gen. Journal Batch | Select the batch of the general journal with which the entries will be created and posted. |
| Document No. | Is filled out automatically according to the set number series of the selected section of the general journal. Can also be filled out manually. |
| Retained Earnings Acc. | Select a G/L account to which undistributed profit will be posted. |
| Retained Losses Acc. | Select a G/L account to which undistributed loss will be posted. |
| Posting Description | Enter information to describe entries to be created with the report. |
| Calculate Retained Earnings (losses) | Enable this option if you want to close the financial result account to undistributed profit or uncovered loss account. |
| Preview posting | Enable this option if you want to preview entries. Is available if there is an Additional Reporting Currency setting, because with this setting, the system creates journal entries and automatically posts them. If there are no additional reporting currency settings, the entries will not be automatically posted, but the corresponding entries will be created in the financial journal. |
| Business Unit Code | Enable this option if you want to create entries for each branch on the G/L account. If the option is disabled, one entry will be created for each G/L account. |
| Dimensions | Set the dimensions and their values that will be assigned to the generated entries. |
Inventory Period Closed | This field specifies that inventory periods with end dates equal to or greater than the last dates of the accounting period are closed.
- Click ОК to run the periodic job.