38 Close Annual Account Balances
This chapter contains the topic:
The purpose of the annual close is to create new records for your new fiscal year with a new balance forward amount. It uses the amount in the Balance Forward field from your current fiscal year F1202 record and adds to it the value for each Net Posting field. Then, it creates a new F1202 record for the new fiscal year and updates the Balance Forward field with the new amount.
38.1 Closing Annual Account Balances
From Fixed Assets (G12), choose Year End Process
From Year End Process (G1225), choose Asset Account Balance Close
When you run the close, new balance records are created in the Item Balances table (F1202) for each of the following:
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Asset
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Fiscal year
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Ledger type
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Subledger
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Account (business unit/object/subsidiary)
You can use Asset Account Balance Close to do the following:
| Task | Description |
|---|---|
| Close fixed assets | You can run the annual close program to close fixed assets any time, before or after you close the general ledger. |
| Rerun the annual close | The main reason to rerun the annual close is to update information that wasn't posted to G/L or F/A at the time the close was run initially. You can run the Asset Account Balance Close as many times as you need to. The first time that you run the annual close, the program creates Item Balances records for the next year. If you rerun the close, the program only creates records if they do not already exist in the system. If the records do exist, the program updates balance information to reflect any new information.
Net posting (period) activity is not affected and as such, may require you to rerun depreciation if it has already been computed for periods in the new fiscal year. This will allow the system to correct changes for over or under depreciation. Rerunning the close does not update depreciation information. For example, after you close fixed assets, you might find that you have more transactions to enter. You can enter those transactions and run the close again. The system processes only those transactions that you enter since the previous close. |
| Close more than one year at a time | You can close a specific company, range of companies, or all companies during the same annual close. You can also close a specific ledger or any other data selection field that is in the Item Balances table. |
The asset account balance close is separate from the general ledger annual close. When you run Asset Account Balance Close:
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The program carries forward fixed asset beginning balance records for the next year by updating the amounts in the following Item Balance fields:
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Prior Year Net Postings
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Prior Year End Balance
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The program creates depreciation information records for the next year. You cannot run depreciation for the next fiscal year until you run the annual close.
Caution:
Be sure to specify a century and year when you run the Asset Account Balance Close program.The following graphic shows how the program creates depreciation information records for the next year:
Figure 38-1 Next Year Depreciation Records
Description of "Figure 38-1 Next Year Depreciation Records"
38.1.1 Before You Begin
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Verify that all transactions are posted to G/L and F/A for accounts shared by the two systems (including depreciation for all ledger types).
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Verify that no one accesses the fixed asset tables while you run the Asset Account Balance Close. The program is unable to close records that are locked by other system applications. Records that a user accesses elsewhere in the system are not affected by the close.
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Run all F/A integrity reports and verify that balances are correct.
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Verify all assets, which are to be retired by year-end, are disposed.
38.1.2 What You Should Know About
38.1.3 Running the Close
Only one processing option exists for the annual close which allows for assets which were disposed in the current year to have their expense and revenue balances carried forward. This feature is used sparingly by clients who have projects and/or jobs associated with these assets and track expenses and revenues that go into the next year.
The key component to running the annual close is the Data Selection field for Fiscal Year. This field must be set to match the fiscal year in your fiscal date pattern(s). Other Data Selection fields can be used to selectively close accounts. Check with your company's general policy for grouping accounts and assets for processing. Also, make sure that tax books not only have been run, but are also closed at some point. The most common issue that occurs, aside from having unposted transactions, is when the AA ledger type is closed separately from tax books (ledger types D1- D5) and the tax books never get closed.
The program does not generate any report, and will not give any indication that it has completed. The easiest way to determine whether or not it is finished is to view the Depreciation and Accounting Values screen and see if records have been created for the new fiscal year. You will not have F1202 records for assets disposed in the previous year (the Date Disposed field will be completed in the Item Master) or for assets with zero costs. Also, tax books for disposed assets will not roll forward since AA cost is zeroed out.