Mastering Year End Closing: A Comprehensive Guide to Efficient Financial Period Finalization

How to do Year End Closing?

Preparation

The main purpose of Year End Closing process is to move the Profit/Loss amount incurred over the Financial Year (stored in Expense, Cost & Income accounts) to the Retained Earnings account.

Ensure that all previous Financial Periods have already completed the Year End Closing process.
Link: https://support.ocisystem.com/portal/en/kb/articles/how-to-list-previous-year-end-closings
Year End Closing should always be completed from the earliest Financial Period onwards.

Once ready to begin the checking and auditing for the Financial Period, go to [Setup > Accounts > A/C Setting] and:
  1. Change the FY's status to "Finalising"
  2. Check that account selected for Retained Earnings is correct.


In this status, the Financial Period is locked and changes can only be made via Journal Entry (for accounts) and Stock Adjustment (for Inventory), this is meant for adjustments.
Now proceed to do your checking of the Financial Period; there are reports such as Profit/Loss module at your disposal.

Posting Profit/Loss amount

Once the balances are checked and ready to be posted, go to [Adjustment > Closings > Year End Closing] and:
  1. Select the relevant Financial Period in "Period" and double-check selected Retain Earning A/C.
  2. Click "Step 1 Generate" and wait for the account balances to appear.
    1. These are the account balances that are about to be posted to the Retained Earnings account; perform a final check of the amounts.
    2. Amount (Previous Period) should be zero if Year End Closing process has been completed for all earlier Financial Periods, otherwise, begin the process with earliest outstanding Financial period.
  3. Click "Step 2 Post" to initiate the posting process.
  4. Print Closing Report if required.




























(do not tick "Post Previous Period Also")

Now the balances from Expense, Cost & Income accounts of this Financial Period have been moved to Retained Earnings account.

If there are no adjustments to be made post-YEC, proceed to [Setup > Accounts > A/C Setting] and:
  1. Change this Financial Period's status from "Finalising" to "Close"
With that, the Year End Closing process is completed for this Financial Period.
You may proceed to generate the Balance Sheet report if you need.

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