Closing an Accounting Year

The year-end closing process involves several steps to move the closing balances of balance sheet accounts from one year to the opening balances of the next year.

Before closing the accounting year on IFS Cloud, you can do a preliminary transfer of balances in order, for example, to make sure the transfer process is accurate or to begin planning the new year.

Then, once the accounting records have been reviewed and validated by an auditor, you can do the final transfer.

Doing the Preliminary Transfer of Balances

Note:
You can transfer a preliminary opening balance to the next accounting year as many times as needed. This action does not create an actual transaction in your accounting records.
  1. Go to the Preliminary Year End page.
  2. Fill in the following fields:
    • Company
    • Ledger ID: select 00 - General Ledger
    • Accounting year period
    • Turn on the Preview/Print toggle to have a PDF report summarizing the preliminary transfer once you validated the page.


  3. Click OK. The following message should appear:
  4. Check the result of the preliminary transfer:
    1. Go to the GL Balance Analysis page.
    2. Search for the Period 0 of your new year (see Consulting the General Ledger Balance for guidelines).

Doing the Final Transfer of Balances

Important:
Do this procedure only once the accounting year is over, with no further changes to the financial records. This process is definitive and must be done after the auditors' approval.
Transfer the final balances from one accounting year to the new accounting year:
  • as balances only,
  • or, as one voucher for the closing balance and one voucher for the opening balance.
  1. Go to the Clear Revenue/Cost Balances page.
  2. Fill in the following fields and click OK:
    • Company
    • Ledger ID: select 00 - General Ledger
    • Accounting Year
    • User Group: select YE
    • Voucher Type: select YE2
    • Select all code parts used in the company


You now need to update the general ledger to update the voucher. This will balance both the balance sheet and the profit and loss statement.
  1. Close all the periods of the accounting year on the Accounting Periods page: see Opening and Closing Accounting Periods.
  2. Transfer the opening balances from one accounting year to the next accounting year:
    1. Go to the Final Year End page.
    2. Fill in the following fields:
      • Company
      • Ledger ID: select 00 - General Ledger
      • Select Create Year End Vouchers
      • Accounting year period
      • User Group: select YE
      • Voucher Type: select YE


    3. Click OK to do the final transfer.
Now that the final transfer of balances is completed, the accounting year is closed. A manual voucher is posted to the first period in the new year. This voucher removes the amount from the Net Profit/Loss account and replace it with, for example, either the Accumulated Profit/Loss or Profit/Loss from last year accounts.
Note:
IFS Cloud gives the possibility to reopen a closed accounting year from the Accounting Periods page, by clicking Open Up Closed Accounting Year. However, this will erase the final transfer of balance. You will need to do the final transfer again.