The 3 Step Perfect Close Procedure
It is absolutely critical that you use the
provided mechanism for closing the G/L year for any company. (Companies,
remember are designated by qualifier. (Of course, if you are using only one G/L
it can be "unqualified" meaning there is no qualifier used for it.)
This procedure allows you to correctly
create a new qualifier to hold the active year's data and copy that data to it.
This new qualifier is the previous fiscal year. The procedure will then close
the active year and clear the Income and Expense accounts which makes you ready
to do work in the new fiscal year. If need be, you can make further adjustments
to the previous fiscal year by adding Journal Entries to it, and bring those
changes forward to the active year, using the special Merge utility provided.
Please carefully read the chapter on Closing the G/L year so that you do these
3 operations properly.
To Close The G/L Year:
1) Use the "Close Year For
G/L" choice on the Setup/Configure
G/L menu,
(Choice 2). It is STRONGLY reccomended that you put the 2 digit year as the
last characters of the current year qualifier when you run this utility. For
example, if your active fiscal year qualifier is called "keep", do as
follows:
Active Previous
Example:
"keep" ->
"keep07" (for the fiscal year 2007)
If your not using a qualifier for the
active year, just use the two digit year by itself for the qualifier for the
previous fiscal year, as follows:
Active Previous
Example:
-> "07" (for
the fiscal year 2007)
2) You can now continue working in the
"new" active fiscal year in your original qualifier "keep". Meanwhile, you can make journal
entries to the previous fiscal year by working in "keeop07". It is
only permitted to make Journal Entries in a previous year. Do not Enter A/R,
A/P or P/R through those modules. This facility is strictly for End Of Year
adjustments by Journal Entry.
3) When they are posted, you can then run
the Special Merge Utility. Choice D on the "nexcfg" menu.
Use "keep07" as the Source Qualifier and "keep" as
the Destination Qualifier.
This completes the process and moves the
new final postings and corrected previous year ending balances to the current
year's beginning balances, for all
Balance Sheet accounts.
The Merge routine (Choice D) can be done
as many times as required. For example, your accountant gives you several
closing adjustment Journal Entries to make to the previous fiscal year. You
make them, post them and then do the Merge. Later, he gives you some he forgot
or sees he needs to add. Simply make them to the previous year as before, post
them and do the Merge again. The new transactions will be moved to the current
year and updated Beginning Balances will be put into place.
By using this method, you can keep any
fiscal year's data on file *without* closing it and losing all the Income and
Expense data. Therefro, you can pull a Profit & Loss Sheet for any period
of any year.