Year-End Close

This guide covers the fiscal year-end close process — the final step in the annual accounting cycle that seals all periods, posts retained earnings, and prepares the ledger for the next fiscal year.

Workspace Reference

Workspace	How Users Reach It	What Users Usually Do There
Fiscal Periods And Fiscal Years	Administration -> Financial Setup -> Fiscal Periods	Confirm all regular and adjustment periods are ready, then execute year-end close where available.
Month-End Close Review	Accounting close process and fiscal period workspace	Confirm all periods are soft-closed and all close blockers are cleared.
GL Journals	Accounting -> Operations -> GL Journals	Review retained earnings journals, audit adjustments, and failed posting blockers.
Financial Reports	Accounting -> Operations -> Financial Reports	Confirm final trial balance, income statement, balance sheet, and retained earnings effect.
Chart Of Accounts	Accounting -> Setup -> Chart Of Accounts	Confirm retained earnings and current-year earnings accounts are configured.

Overview

Year-end close is a one-time, irreversible operation per fiscal year. It:

1. Validates all regular periods are already SOFT_CLOSED
2. HARD_CLOSEs every period in the fiscal year (no further posting possible)
3. Calculates net Profit & Loss for the year
4. Posts a retained earnings journal (DR Current Year Earnings → CR Retained Earnings)

DANGER

Year-end close cannot be reversed. All periods become HARD_CLOSED permanently. Ensure all adjustments are complete before proceeding.

Prerequisites

Before running year-end close, verify:

• All 12 (or custom count) regular periods are SOFT_CLOSED
• Adjustment periods (if any) have all entries posted
• FX revaluation has been run for the final period
• Intercompany elimination is complete
• All recurring journals have been executed
• Audit adjustments are posted and approved
• Sub-ledger ↔ COA reconciliation passes for all control accounts

Running Year-End Close

1. Navigate to the Fiscal Years or year-end close area in fiscal period management.
2. Locate the fiscal year to close
3. The system will show the current status summary (e.g. "Soft Closed: 12, Open: 0")
4. Use the year-end close action.

The system will:

• Validate all regular periods are closed
• HARD_CLOSE every period (including adjustment periods)
• Calculate net profit or loss from the year's posted Profit and Loss accounts.
• Post the retained earnings journal using the configured current-year earnings and retained-earnings accounts.
• Log the activity

Accounts Required

The retained earnings journal relies on two configured accounts:

Account Role	Purpose
Retained Earnings	The equity account that accumulates prior-year profits or losses.
Current Year Earnings	The temporary equity account cleared at year-end.

These must be configured and mapped to the appropriate accounts before year-end close can run.

Post-Close State

After year-end close:

• All periods show status HARD_CLOSED — no exceptions
• The retained earnings balance reflects cumulative profits/losses
• Current Year Earnings is zeroed out
• A new fiscal year (generated from the fiscal calendar) begins fresh with NOT_OPENED periods
• Opening balances for the new year are derived from the approved closing balances

Next Fiscal Year

After closing the current year:

1. Generate the next fiscal year from Fiscal Period Management → Generate Fiscal Year
2. Select the fiscal calendar and target year
3. Open the first period to begin the new cycle

Permissions

Permission	Description
CLOSE_FISCAL_YEAR	Execute the year-end close operation
GENERATE_FISCAL_YEAR	Generate a new fiscal year and its periods
VIEW_FISCAL_YEARS	View fiscal year status

Troubleshooting

"Not all regular periods are closed" — One or more periods are still OPEN. Close them individually first.

Retained earnings account is not configured — The retained earnings account role is not mapped to an approved GL account. Configure the account role before retrying.

Current year earnings account is not configured — The current year earnings account role is not mapped to an approved GL account. Configure the account role before retrying.

"SL-COA reconciliation failed" — Sub-ledger balances don't match the control account. Investigate and post correcting entries before retrying.