MONTH END ACCOUNTING

You are not required to do anything at month end in order to begin transactions in the next period.  There is no monthly Close like there is with many accounting systems.  There are, however, a set of monthly procedures that are recommended as sound accounting practices, detailed in this section.

GL Close Date

Unlike many accounting systems, there is no formal monthly closing required.  You can freely post to any period in the current year or up to six years past.

The system does have a Open Period  Start Date, however, that will not allow posing to any period prior to that date.  The Open Period Start Date is set using AM-A Reset General Ledger Close Date and serves to Close prior periods to other users.  With the Open Period  Start Date capability the system is closed when you consider it closed, not due to any requirement within the program itself.  The Accounting Open Period Start Date can be used to close a period for all users but leave it open for accounting to make Journal Entries, AP Voucher entry and optionally AR Customer payments.

If for some reason you need to make entries to what you consider to be a closed period, you can temporarily remove or change the Open Period Start Date using AM-A Reset General Ledger Close Date make your entries, then restore the date.

Recommended Month End Procedures

Make a complete system backup

Perform a complete backup of your entire system (programs and data files) and archive it in a safe place.  This way you can restore your company exactly as it was should there ever be a need to do so.

Print control reports

A good accounting practice at month end is to print a series of  control reports so that the amounts on them are reconciled with certain critical General Ledger account balances to ensure the accuracy and reliability of your General Ledger data.

All the following control reports can be run at any time as of your month end date and are therefore not required to be printed prior to entering any transactions in the new month.

Print IN-F  Print Inventory Value as of month end and compare value(s) to your inventory GL account(s).  If necessary, run UT-K-G  Recalc Inventory Book Value and make any needed journal entries.  Be aware that if there have been items received into QC, the total value in IN-F does not include them and you should also run PO-J-B  Print Inventory in QC to get the total value of all inventory.  If you run   IN-F  Print Inventory Value as of a prior date, it takes the current inventory value and backs out transactions back to the as-of date to arrive at the value.

Print PO-I-F  Print Received not Invoiced and PO-J-B  Print Inventory in QC as of month end.  The total of the two reports should agree with your PO's Received not Invoiced GL account.

Print AR-F  Print Aging  as of the month end date in Accounts Receivable answering N to include Deposits.  The report total should agree with your Accounts Receivable GL account.

Print AR-F  Print Aging  as of the month end date in Accounts Receivable answering O (Only) to include Deposits.  The report total should agree with your Customer Deposits GL account.

Run JC-M  Print WIP Summary as of the month end date.  Once you enter the as-of date, the transaction date, Work Order Status and Actual Finish Date fields on the right side of the screen will be populated.  DO NOT change those values.  The As-Of Date report will include all transactions through the designated date to work orders still open and to work orders currently closed or canceled but that were open on the as-of date.

Print AP-I  Print Aging  as of the month end date in Accounts Payable answering N to include Deposits. The report total should agree  with your Accounts Payable GL account.

Print AP-I  Print Aging  as of the month end date in Accounts Payable answering O to include Deposits. The report total should agree  with your Purchase Order Deposits GL account.

Run GL-I  Print Check Register. Uncleared Only, Checks and Deposits through the month end date after reconciling to the bank statement. The report totals should agree with the GL account balances for each of your checking accounts.

Perform typical month end activities

The following activities are typically performed at month end.

Charge interest on past due invoices, if applicable (AR-D  Charge Interest on Invoices).

Print and mail customer statements (AR-E  Print Statements).

Generate recurring and/or reversing monthly journal entries, if applicable (GL-B  Enter/Print General Journal Trxns) and post them to the General Ledger (GL-O  Print/Post General Ledger Batches).

Generate recurring monthly sales orders, if applicable (SO-K  Generate Recurring Sales Orders), and print and post invoices (SO-F  Print Invoices, SO-G  Post Invoices).

Generate recurring monthly AP vouchers, if applicable (AP-P  Generate Recurring Vouchers).

Transfer sales taxes due to Accounts Payable AR-L  Transfer Sales Taxes).

Transfer sales commissions due to payroll and Accounts Payable (CS-D  Transfer Sales Commissions).

Run SM-J-C  Reconcile Inventory On-Hand to insure accuracy of stock status fields.

Run UT-K-G  Recalc Inventory Book Value and make any necessary journal entries.

Make journal entries for any month end adjustments such as depreciation (GL-B  Enter/Print General Journal Trxns) and post them to the General Ledger (GL-O  Print/Post General Ledger Batches).

Optionally purge the following files: AP History (AM-J Archive/Purge AP History), AR History (AM-K Archive/Purge AR History), closed sales orders (SM-J-J  Archive/Purge Closed Sales Orders).

Reconcile the check register with your bank statement (GL-J  Reconcile Check Register).

Make month end manufacturing adjustments

To complete your month end manufacturing accounting, three variances should be evaluated to review the accuracy of labor and overhead rates.  Journal entries reflecting these variances can be entered through GL-B  Enter/Print General Journal Trxns and are posted to the General Ledger via GL-O  Print/Post General Ledger Batches.

Calculate your monthly Labor Variance by comparing actual direct labor with your Absorbed Labor account and post appropriate adjusting entries to your WIP Variance (expense - adjacent to Cost-of-Goods-Sold account) and Labor Variance (expense - adjacent to Cost-of-Goods-Sold account) GL accounts.

Calculate your monthly Fixed Overhead Variance by comparing your actual fixed overhead with your Absorbed Fixed Overhead account and post appropriate adjusting entries to your WIP Variance (expense - adjacent to Cost-of-Goods-Sold account) and Fixed Overhead Variance (expense - following Labor Variance account in Cost-of-Goods-Sold section) GL accounts.

Calculate your monthly Variable Overhead Variance by comparing your actual variable overhead with your Absorbed Variable Overhead account and post appropriate adjusting entries to your WIP Variance (expense - adjacent to Cost-of-Goods-Sold account) and Variable Overhead Variance (expense - following Fixed Overhead Variance account in Cost-of-Goods-Sold section) GL accounts.

Set GL close date and print financial statements

Reset General Ledger Open Period Start & End Date using AM-A Reset General Ledger Close Date, if desired

Print financial statements (GL-F  Print Financial Statements or GL-N  Print Custom Statements).