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About the Year End Process

The year end process is an easy way to close your accounts for a financial year so that you can prepare your profit and lossAlso known as an income statement. account and balance sheetAlso known as a statement of financial position..

Warning:

Warning

You must make sure that the opening balances in period 000 are the correct brought forward balance sheet values. Once the year end process starts, the periods in the selected year are closed and locked. You will not be able reopen them. This includes period 000 and 101. General ledger accounts types are also locked. The only period remaining open is adjustment period 100.

Before you start

The year end process will not run if any of the following is true:

• There are "In Progress" or "Ready to Post" documents for the selected year. You should post or discard these documents before running the year end process.
• The year end process has been run before for the same year or a future year (Year End Status = Closed). You must run year end processes in chronological order.
• There is another year end process running for the same company (Year End Status = Closing or Error).
• The selected year has no special periods defined.
• Period 101 has documents posted to it (Period 101 must be empty).
• The following year or period 000 of the following year do not exist.

When running a Year End, you must have your correct brought forward balances in period 000 of the year for which you want to run Year End. A warning is displayed if period 000 for the current year exists but is empty. This means that you have no opening balances for this year.

Before you start a year end you must specify the following items on the current company and/or year. If these items are defined at company level, they are used as a default at year level but you can amend them at any time before the process starts.

• The general ledger accountThe general ledger will normally include general ledger accounts (GLAs) for items such as income, expenses, assets, liabilities, and reserves. to use as a suspense account.
• The general ledger account to use as a retained earnings account.
• The year end modeGLA Only or Full Accounting Code. This mode controls the detail and size of your year end journal lines. for the year end process.

If your multi-company org has more than one home currencyThe main working currency of the current company., you must create a separate retained earnings and suspense account GLA for each home currency. So, for example, if you have two USD companies and one GBP company in your org, you must create the following GLAs:

• Retained Earnings USD
• Suspense USD
• Retained Earnings GBP
• Suspense GBP

The two USD companies can share the same USD GLAs.

Ensure that all transactions are posted, corrections and adjustments made, bank accounts reconciled and key reports checked before running a year end.

Reports

Some key reports to check before starting the year end process:

• debtors aged analysis
• creditors aged analysis
• trial balance
• profit and lossAlso known as an income statement.
• balance sheetAlso known as a statement of financial position.

Custom settings

The following custom settings include fields that relate to the Year End process:

• Accounting Settings
• Document Line Volume Settings

See Managing Custom Settings for more information.

Validation rules

Before running your Year End process, work with your System Administrator to review your validation rules on FinancialForce objects, in particular rules that affect transactions and transaction line items. Validation rules that interfere with the posting of year end journals and documents may need to be temporarily disabled.

Running a year end

See Running the Year End Process for more information.

What happens during the year end process?

• Batch jobs are initiated to create and post a series of year end journals. The balance sheetAlso known as a statement of financial position. process starts immediately after the profit and lossAlso known as an income statement. process has completed successfully.
• The profit and loss process reads all transaction line items for the selected year's trading periods and sorts either by general ledger account or by full accounting code. This depends on the year end mode in force. You can select the year end mode at company and/or year level.
• The balance sheet process reads all transaction line items for the selected year's brought forward values in period 000 and its trading periods and sorts either by general ledger account or by full accounting code as before.
• A new journal line item is created at each change of general ledger account or full accounting code. The values on each transaction line item are summarized on each journal line item and its sign is reversed. When the maximum number of journal lines is reached, a new journal header is created.
• The transactions posted to profit and loss GLAs are posted to the retained earnings GLA in period 101 of the year being closed.
• The transactions to balance sheet and retained earnings GLAs are posted to the brought forward balances (period 000) for the following year.
• The suspense GLA will be cleared to 0.00 at the end of the year end process.

Notifications

When the process completes you will receive a notification by email. If Chatter is enabled, you will receive a notification on your Chatter feed too.

Any errors will be shown in Year End Logs. There should be a related list on the Year object. If not, ask your administrator. Additional error information can also be found on the Apex jobs page, with the Apex class CODAYearEndBatch.

Year end journals

All resulting journals have a type of "Year End Journal" and a status of "Complete". You cannot amend, cancel or delete year end journals.

• Journals created by the profit and loss process will have a reference starting "PL".
• Journals created by the balance sheet process will have a reference starting "BS".

Year End adjustments

You can post adjustments automatically using the year end adjustment process. Running Year End Adjustments

Year end adjustments need to be reflected in both periods 100 and period 000 so that your opening balances are correct.

Here is an example:

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