Running the Audit File Close
You must run the Audit File Close program (P04514CMP) prior to building the audit file for the current 1099 reporting year. If you ran this program at the end of the last 1099 reporting year, you do not need to run it again. If you did not run the program or you cannot verify that you ran the program, you should run the program again before you run the Create 1099 Audit File program (P045144).
You run the Audit File Close program to mark the audit records from the prior year as processed so you can retain them for IRS audit purposes. The system selects only the Type 1 and Type 2 records from the 1099 Audit File (F045144) that have a blank in the Closed Item field (FNLP), and then updates this field to 1 to signify that the records are processed. Because the Create 1099 Audit File program clears any unprocessed records from the 1099 Audit File, updating the prior year records as processed prevents you from unintentionally deleting prior year transactions when you run the Create 1099 Audit File program.
If you run the Create 1099 Audit File program for the current 1099 reporting year before you run the Audit File Close program to close the prior year's records, the program deletes all of the prior year records. If this occurs, the audit trail is lost. Although you can rebuild the audit file for the prior year and then close the records before building the audit file again for the current 1099 reporting year, there is no guarantee that the system will create the records exactly as they were when you built the audit file originally, since the original data could be changed due to voids of payments.
If you close the Audit File records in error (for example, for the current 1099 reporting year), you can reset the records, which removes the value from the Closed Item field.
To reset the records:
Verify that you have the correct year in the Calendar Year processing option for the 1099 Processing Options Setup program (P04510STUP).
If you did not set this processing option to the current 1099 reporting year, the system returns an error because it locates records from the prior year.
Enter 1 in the Close Year or Reset Flag processing option for the Audit File Close program.
Run the Audit File Close program again to change the value of the Closed Item field from 1 to blank on the current 1099 reporting year records.
Run the Create 1099 Audit File program.
Navigation
From Annual 1099 Setup(G0442), choose Audit File Close