Closing the Fiscal Year

Closing the Fiscal Year Overview

This process closes the net profit to the retained earnings acTransactions are moved from the GL tables into a history table. Closed years are not available for inquiry on standard reports; however, you can view information using the history reports or within FRx.

Khameleon does not require users to run this year-end closing process to begin a new accounting year. If you do not close the year, no journal entries are made, but the reports will be correct for the new year. The income statement accounts are computed from 0 for each new year and the offsetting amount is printed on the balance sheet.

You may close the fiscal year once all transactions for that year are completed and you have entered your final year-end adjustments.

Note:  Khameleon does not require that you run the Year End process.  Retained Earnings adjustments may be manually made.

Preparation

●        Confirm with your DBA that the necessary space is available in your General Ledger archive tables.  Ensure that there is room in the tables and indexes for the gl_history and gl_archive.  The sizes must match the size of the gl_detail and gl_summary.

●        If you begin the year end close process after hours or on a weekend, verify with your DBA that no automatic database shutdowns will occur during the procedure.

●        Ensure that the account types are correct in the GL accounts window so all appropriate accounts are closed to retained earnings.

●        You cannot close a year if a prior year has not been closed.  Close prior years that are still open in ascending order.

●        If you have FRx, it is recommended that you run the FRx process prior to closing the fiscal year to pick up any entry that may have been posted to a prior year.

What happens when you close the year?

1.        Archives G/L information for the closed year.  Moves gl_summary records into gl_archive for the year being closed.  Moves gl_detail records into gl_history for the year being closed.

2.        Creates a Journal Entry that closes income and expenses into Retained Earnings.  Retained Earnings is calculated as Revenue minus Expenses and added to the prior balance of the Retained Earnings account.  

3.        Balance Sheet Accounts are consolidated into one Balance Forward record per account (in both gl_detail and gl_summary).  

4.        Revenue and Expense accounts are purged for the year being closed.

5.        Creates a batch history record in table sy_batch_history.

Accessing Historical Data

●        Historical data can still be viewed in the GL Account Detail, Drill-Downs screen by pressing the [History] button.

●        Reports (Historical Financial Statements and GL Information) are accessible for closed years under Accounting > General Ledger > Reports > History, and within FRx

Helpful Tips

●        If transactions must be entered in a closed fiscal year, you may reactivate the periods, enter the transactions, and re-close the fiscal year.

●        Verify that account types are set up correctly in the Set Up Account screen as this is the data that the system uses to determine which accounts are being closed into retained earnings.

●        When you created the self-balancing entity, the chart of accounts did not yet exist in Khameleon.  Verify that the retained earnings account number is valid before executing this procedure.

Year End Close

Menu Path: GL > Processing > Close Fiscal Year

This process closes the net profit to the retained earnings account (defined in the Self-Balancing Entity window) for the fiscal year.  Please read Closing the Fiscal Year Overview before performing this process.

Do not close a particular fiscal year until

●        All prior years are closed (enforced by the application).

●        FRX process has been run.

●        Transactions are complete for the year and all final year-end adjustments have been made.

Perform the following to close a fiscal year:

Entity.  Enter the self-balancing entity to be closed.  Only one entity may be closed at a time.

Fiscal Calendar.  Displays the fiscal calendar for the selected entity.

Fiscal Year.  Enter the 4-digit year to be closed.  

Note: All prior year must already be closed.

Close Retained Earnings to Period.  Enter the period to which the retained earnings should be closed.  This is typically the last period in the fiscal year.

Close?  Enter 'Y'es to close the selected fiscal year.

[Process]  Press this button to close the fiscal year.