Book Closures

Book Closures

Finance Book Closure allows you to finalize your accounts for the end of the financial year. You can do that by selecting the closing date, all the financial transactions in the system before the closing date will get locked once the book closure is completed.

The below steps shows you how to perform book closure:

Step 1 : Under Finance Books, go to Book Closures module. Click on Add.

Step 2 : In the New Finance Book Closure screen, select a Closing Date.

This is the date till which you want the financial transactions to be closed. The start date is disabled, the system picks the oldest transaction date from your account as the Start Date when you are closing your books for the first time.

Step 3 : To rename the Book Closure name, check the checkbox ‘Modify Name‘ and then you type in the Name field.

Step 4 : Once the closing date is selected, the system will populate the total of all profit and loss account details for the selected date range. You will see the credit and the debit totals.

Step 5 : You can verify these numbers from Financial Accounts module.

1. Select the filter.
2. Check Profit And Loss from Account Type filter.
3. Click on View Combined Ledger of all Accounts

Step 6 : In the View Combined Ledger of All Accounts screen, select the same date range that you have for book closure. You can then see the totals and the transactions.

Step 7 : Once you have verified the numbers for the selected date range. You will then have to check all the checkboxes to confirm that you have verified the numbers and transactions that you are about to close.

Step 8 : In the confirm screen, enter the text and click on Yes to confirm.

Step 9 : Once you have ticked ON all the checkboxes, click on Complete Book Closure to close the books. You will have to select a date for the book closure transaction date.

Once you close the books, the system creates a financial transactions for Retained Earnings. The transactions are created on the date you select here while closing the books.

Step 10 : Once you save the book closure document, you will see the document in the Book Closure manager.

You will see the financial transactions system had created for the date you had selected while saving. Here system creates 2 new financial accounts ‘Book Closure Processing Account‘ and ‘Retained Earnings‘.

After the books are closed, and then when you try to create a backdated document or try to modify/delete a document that has financial transactions and it is within the date range that you have already closed, then the systems throw an error.

You can delete the Book Closure document from the 3 dots option and then click on Delete. This will also delete the financial transactions of Book Closure and you can then make changes to the older transactions.

After you have closed your books and when you again create a new book closure, the system will consider the start date as the last closing date of last book closure document. You will also see the Retained Earnings total.