Year-End – Closing Fiscal Year (v5.0)

Modified on Wed, 20 Sep 2023 at 09:39 AM

 

  

Purpose of this document

 

The closing fiscal year is a process that is run at the end of each calendar or fiscal year to transfer the balances from the revenue and expense accounts to the respective net asset (fund balance) accounts.  The transferred entries are marked as closing entries in the G/L Entry Table in compliance with GAAP.  Once marked, these entries can be excluded in order to run revenue and expense reports across multiple fiscal years.  Ceres allows the user to run the Close Income Statement process an unlimited number of times. The process to close the fiscal year requires multiple steps which are outlined in the document.

 

Ceres Object release 5.00.00 is required for the functionality described in this document

 

 

 

Table of Contents

 

Accounting Periods

The first step in the Year End Process is to close the Accounting Periods.  This process sets each period within the fiscal year as closed.  This allows the user to begin the closing process.  The close process does not stop a user from posting entries to a closed period.  Allowable posting dates are controlled by updating the Allow Posting From and Allow Posting To fields in the General Ledger Setup and/or User Setup.

 

1. To close the Accounting Periods, go to Departments à Financial Management à Periodic Activities à Fiscal Year à Lists à Accounting Periods.

 

 

2. From the Accounting Periods Page, select Home à Close Year.

 

 

 

3. A dialog box will display indicating which fiscal year you are closing.  Select Yes to proceed. This will automatically update the Closed field for each month within the fiscal year.

 

 

 

4. Normally when you close a year, you should create a new year right away.  From the Accounting Periods

    Page, select Home à Create Year.  This will automatically enter the data for the next fiscal year.  If it is

    correct, select OK to proceed or adapt the data as needed and select OK. 

 

 

Close Income Statement

 

The Close Income Statement process creates Closing Entries to transfer the Revenue and Expense balances by Dimension, Fund, and Branch Code to the applicable Net Asset Account.  This process creates a Journal Entry that must be reviewed and posted before the closing is complete.  

 

You can review or delete the closing entries from the Journal and rerun the Close Income Statement process as many times as necessary.  Once you post the closing entries you can post additional transactions to the closed fiscal year, such as audit entries.   You can then reclose the income statement which will only close the new entries. Balance Sheet Accounts do not generate closing entries.

 

1. To create closing entries, go to Departments à Financial Management à General Ledger à Periodic

    Activities à Fiscal Year à Tasks à Close Income Statement.

 

  

2. A Close Income Statement Page will display.  On the Option FastTab update the fields as necessary.

 

 

 

Fiscal Year Ending Date - Confirm that this is the correct fiscal year you want to close.  If not, input the correct date.  Please note that you can only select a fiscal year that is closed. 

 

Gen. Journal Template - Select the Journal Template you want to use for your closing entries.  

 

Gen. Journal Batch - Select the Batch you want to use for your closing entries.  It’s recommended you create a Batch just for your closing entries, such as YRCLOSE.

 

Document No. - Input the Document No you want to use for your closing entries.  This field will automatically fill in if a No. Series is linked to the Journal Template.

 

Retained Earnings Acct.:  Input your Retained Earnings (Net Assets) G/L Account.  Once the entries have been created, you can split them across multiple Retained Earnings (Net Assets) G/L Accounts.

 

Posting Description - Enter a description for your closing entries.   This field will default to Close Income Statement but can be overridden.

 

Close by Business Unit Code:  Place a checkmark in this field if you want to create a closing entry for each Business Unit.   Generally, this is used when creating closing entries in the consolidated company.

 

Dimensions:  On the ellipsis button to the right of the field and then select the Dimensions you would like to create closing entries for.  

 

Fund No.:  Place a checkmark in this field if you want to create closing entries for each Fund.

 

Branch Code:   Place a checkmark in this field if you want to create closing entries for each Branch (Responsibility Center). 

 

Inventory Period Close:  A checkmark in this field indicates that the inventory periods with ending dates equal to or greater than the last date of the accounting period is closed.

 

3. Click OK to proceed with the Close Income Statement process.

 

Post the Closing Entries

 

Once the closing entries have been created, they should be reviewed and then posted.  Posting the entries transfers the balance from the Revenue and Expense Accounts to the Net Asset Accounts. 

 

1. To post the closing entries, go to Departments à Financial Management à General

    Ledger à Tasks à General Journals.

 

 

 

2. Select the Journal Template and Journal Batch you selected above when you ran the Close Income

    Statement process.  In this example, the closing entries were written to the YRCLOSE Batch in the General

    Journal Template.

 

 

 

3. Review the closing entries.  You may need to split out the Net Assets entry by Fund No to post. 

 

 

4. Select Post, or Post and Print to post the closing entries.

   

5. To review the posted entries, go to Departments à Financial Management  à   History  à General

    Ledger à  History à G/L Registers.  Scroll to be bottom of the G/L Register List or filter for a Source Code of

    CLSINCOME.   

 

 

6. To display the closing entries that were posted, select Home à General Ledger Entries.  Please note that all

    closing entries will be preceded with C in the Posting Date field

 

 

Reclosing the Year

 

The fiscal year can be closed multiple times throughout the year.  It’s common practice for some food banks to run the Close Income Statement function shortly after their yearend and then again after the audit adjustments have been entered.  

 

Reclosing the Year is as simple as rerunning the Close Income Statement function.  Ceres will create closing entries for any new transactions or entries that have not been closed previously.  Before running the Close Income Statement function, you should always check to make sure that no closing entries exist in the Journal.  If so, either delete or post the entries before you rerun the Close Income Statement function.

Related Topics

  1. Account Schedules
  2. Chart of Accounts Overview
  3. Fund Overview
  4. GL Dimensions and Dimension Values
  5. General Journal Overview

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