Year end close in Dynamics GP
November 14, 2008 32 Comments
Every year we get a slew of phone calls about closing the year in GP. Usually these start in December and I thought I would beat the rush this year. Here are some resources and notes I have compiled over the years on the year end close. I will add to this post as I find more resources or if I get additional questions, so you can always find updated information here.
GP KnowledgeBase Articles
Microsoft publishes and updates articles that explain in great detail how the year end close should be done and all the implications and timing issues. Here is order that the modules should be closed in and the related articles:
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Receivables Management – KB 857444
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Payables Management – KB 875169
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Fixed Assets – KB 865653
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General Ledger – KB 888003
Other Resources
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Mark Polino’s Dynamics Sherpa Year End Close video
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Accolade Publications Year/Period End Procedures (click on Great Plains on the bottom, then Year/Period End Procedures on the right)
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Information about performing the year-end closing procedure in Receivables Management in Microsoft Dynamics GP after December 31 – KB 851140
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Each Dynamics GP manual will all have a section on the year end close if it is applicable for that particular module
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GP 9.0 – 2008 US Payroll Year End Update
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GP 10.0 – 2008 US Payroll Year End Update
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Mariano Gomez: 2008 Year End Update and Microsoft Great Plains 8.0
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Christina Phillips of Dynamics GP Land: Year End 2008 Tips and Tricks
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Doug Pitcher of Rose Business Solutons: 2008 Payroll year end close update Dynamics 10.0
General Ledger – Common Questions
When? The biggest question we get on the General Ledger close is when to do it. On one hand you don’t want to close the GL before all your adjustments are in and/or the audit is done. On the other hand, you hate not being able to see beginning balances for the GL accounts and having to use alternate FRx reports to add in last year’s numbers. Since you can post to the last fiscal year even if it is closed there is no harm in closing the fiscal year sooner than later. However, make sure that you won’t need to post to years prior to the last closed year, since you won’t be able to do it. (In other words, once you close 2008, you can still update 2008, but 2007 is done at that point.)
I said I won’t need to, but how do I post to 2005? If you absolutely positively have to post to more than one prior year, it is possible, but it will cost you. The Microsoft Professional Services team has a procedure they can run on your system that will re-open prior years. The cost will depend on the size of your data, how many companies and years you need to open and when you need to do this. We have used this service a number of times and have never had an issue, so it definitely works. To get more information on this, contact your GP Partner and show them this link.
How do I actually post to the last closed year? Here are the steps:
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Go to Tools > Setup > Company > Fiscal Periods and make sure the period you want to post to is open (unchecked).
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Go to Tools > Setup > Financial > General Ledger and make sure Allow Posting to History is checked.
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Enter and post your transaction. Read this before you look at your posting journal: the entry will look like it is posted twice. It’s showing up on the report twice because it’s updating last year’s balances and then updating this year’s beginning balances. This is ok.
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Go to Tools > Setup > Financial > General Ledger and uncheck Allow Posting to History. While it is ok to leave this checked, I recommend disallowing posting to history to avoid mistakes.
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Go to Tools > Setup > Company > Fiscal Periods and close (check) the period you opened in step 1. Again, you can leave the period open if you want.
What if one of my Balance Sheet accounts was set up as a P&L account? If one of your accounts was set up with the wrong Posting Type and you did not catch this before performing the year close, you can use KB article 864913 to correct the problem.
Other Common Questions / My 2 Cents
Payables and Receivables – to close or not to close? Most companies we work with do not close the Payables and Receivables modules anymore. Since it is virtually impossible to have a clean cut off between transactions for 2 years, it really does not add any value to perform the year end close for these modules.
Backups – do we really need them? As far as I am concerned, one of the most important parts of the year end close is making a backup before starting. I have only actually needed this backup twice, but we were sure glad we had it those two times.
What is the close procedure for other modules, like Bank Rec or SOP? Other modules do not have a ‘year end close’ process, however, prior to performing the year end close on the modules that do make sure that everything for that year is posted.
Updates:
01.08.2009: added link to Doug Pitcher’s blog post under Other Resources
01.07.2009: added link to Dynamicd GP Land blog under Other Resources
12.24.2008: added links to Mariano Gomez’s blog posts under Other Resources
11.17.2008: added links to the year end payroll updates under Other Resources
08.04.2010: added link to the GL Year End Open Service from Microsoft
How do we close period in GP 10.0?
Angela,
Can you please clarify what you mean by ‘close period’?
-Victoria
Hi Victoria, I am in need of your help. I have closed the Fixed Asset Module but I need to undo it. Is there anyway to undo it?
Please help! Thanks!
Hi Chen,
I am not aware of any way to undo a Fixed Assets year end close. I have not done this myself, but there may be ways to do this directly in SQL. However this is not something that I would advocate doing without help from your GP Partner or the GP Support team.
-Victoria
Hi Victoria, how about going back to back up and restore previous data? Is there a way to restore only the Fixed Assets Module?
Your help will be much appreciated
Chen,
There is no easy way to restore only Fixed Assets data. And depending on what has been done since the backup, that may not work anyway. What is the reason that you want to re-open the year? Perhaps there is another way to accomplish what you need.
-Victoria
I made a mistake by doing a Year End Close for the current Fiscal Year so now it appears for year 2011 and I can’t do depreciation for the current Fiscal Year. so I want to find a way to undo this so I can post depreciation for the current Fiscal year…
Chen,
I would recommend talking to GP Support to have them help you with this.
-Victoria
Hi all,
My accounting department told me about a problem with the retained earnings. It is not updating across. The income statement updated just fine but the retained earnings did not. Is there some steps that I can do to see what is causing this to happen? I appreciate any help and assistance.
VC,
Can you be more specific as to what ‘not updating across’ means? Where specifically are you looking to see this?
What should happen is this: the total of the income or loss from the previous year should be added to the beginning balance of the Retained Earnings account of the new year. For example: Retained Earnings account balance at the end of 2009 is ($50,000). Income for 2009 is $25,000. If you look at the Summary Inquiry of the Retained Earnings account (Inquiry > Financial > Summary) the Period Balance on the Beginning Balance line should be ($75,000).
-Victoria
Okay, now on the retained earnings, I got some details. My CFO went back to 2002, where we have an offset account, 99-99999-98 which had been updating the balances correctly until 2008 where it did not. The balance sheet for 2008 is blank with no totals when there was a balance coming forward from 2007. 2008 is when the company upgraded to Great Plains 9. Before this upgrade they were using the 99-99999-98 to send the retained earnings to, but now we are using the 00-39000-00 account. The income statement updated just fine whereas the retained earnings didn’t. Any ideas on how to fix this?
VC,
I am sorry, I am still not understanding exactly where you are looking for your balances and what you’re seeing. If you suspect something is not right with your year end close, I would strongly recommend getting your GP Partner or Dynamics GP support involved so they can help you determine if there is an issue and find a fix.
-Victoria
We have “closed” the 2009 fiscal year ONLY for the Payables module so that if we have to re-do a 1099, we will be able. Can we close the GL for 2009 without closing the CALENDER year for the Payables module?
BAT,
Re-printing 1099′s is possible no matter whether you have closed the year for payables or GL or not. Don’t take my word for it – test this in a test company. If that is your only reason for waiting to close, go ahead and close.
-Victoria
Hi Victoria Yudin,
Do you have SQL query that will show the actual effect after year end.
I need to know what will happend to all accounts transactions (PL, BS and Retain earnings) before actual year end.
It is something like before year end SQL query will tell me how my data will look like in system.
Regards,
Santosh
Santosh,
I do not have a SQL query like this, nor would it be trivial to put together. I would typically create this kind of report in FRx, where it would be a lot easier.
But in basic accounting terms, here is what would happen:
- All Balance Sheet account ending balances would get brought over to the beginning balances of the following year.
- All P&L account balances would get totalled up and the net result of them would be added to the beginning balance of the Retained Earnings account in the following year.
-Victoria
Hi, I’ve come across a question that I hope you can answer related to posting to a closed year. I re-opened 2008 and posted audit adjustments. However, Why does “inquiry/financial/history summary” now not reflect the same net change for a closed year as “inquiry/financial/history detail”? The difference is the amount of my audit adjustment.
Why would the balance sheet audit adjustments posted after ye close not show up in the history detail inquiry?
Thanks!
Susan
Hi Susan,
While I recall having seen this in the past (and not having it be an issue with any financial reports), I am not able to find any example of this in our data (running on GP 9.0 SP 3) or to duplicate it in a test.
What version of GP are you on? Have you tried running reconcile on the financial series?
-Victoria
It’s not an issue as far as our FRx balance sheet goes, everything is correct. It’s just that the AAs don’t show up in the history detail inquiry. We are on 9.0 and I’ll try financial reconcile tonight if you think it would clear the problem.
Susan,
I can’t say for sure that it will help, but it’s worth a try. I am on GP 9.0 SP 3 and am not able to duplicate this issue. But like I said, I have definitely seen it in the past. If reconcile (or check links) does not help and it is important, you might want to talk to GP support to see if they can help. Sorry not to be of more help.
-Victoria
If you start posting inventory to new year before you close previous year. What areas get affected
Hazvi,
Take a look at the list of items under Step 6 of the GP KnowledgeBase article on the year end closing procedures for the Inventory module. Basically all the stuff that’s listed there will not happen at the proper time. Nothing earth shattering, but if you are relying on some of these numbers, they may not be accurate.
-Victoria
Thanks. By not closing Payables, will it affect 1099s in any way? I setup the new fiscal year 2009 and it gave a message about balances are affected and reconcile should be run. Is that normal?
Hope,
Not closing the Payables module has no effect on the 1099′s. Typically the only time you would get a message about reconciling in the Fiscal Period Setup window is if system thinks (whether rightly or not) that you made a change to an existing fiscal period. I would recommend double checking all your years just to make sure they are all as they should be.
-Victoria
Payables isn’t done with their 1099′s and we are no where near finishing our 2008 GL entry adjustments. Receivables wants to post to 2009. It’s our first year on GP and we are on GP10. Do I close GL for 2008 and leave all the other modules open so then we can post to 2009? or is there some other way to handle this?
Hope,
You can have an unlimited number of years open in GP. So I would recommend keeping the 2008 GL open until (at the very least) you have entered all your adjustments. My personal 2 cents is not to even bother closing the Payables and Receivables modules, so you’re ok there. Just create the 2009 year and start posting to it as needed, and you can still post to 2008 with no problem.
-Victoria
tTPE20 Thanks for good post
I really appreciate you compiling all of this info. One question though on the year end payroll checklist. Microsoft specifically says to finish all payruns for the year and then apply the year end tax update which includes the most recent service pack. Having to install a service pack in between holidays at the end of the year isn’t something most people want to do. Can’t that year end update be applied anytime prior to year end? This would allow people to schedule this work before the holidays. Disregarding the service pack, it’s only changing W2 and 1099 forms. Thanks again!
Darren,
That is a great question. As a disclaimer – I do not have too much experience with GP Payroll myself – we are in an area where payroll taxes are very complex and most of our customers choose to outsource payroll. However, my understanding is that you can install the year-end update at any time, but you must wait to install the 2009 Payroll tax updates until after the Year-End Wage file has been created.
–Victoria
Great post. I was just going to do something like this but will save some time and reference your eloquent words.
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Mark Polino just posted links to the year end payroll updates on his blog: http://msdynamicsgp.blogspot.com/2008/11/year-end-payroll-updates.html.
I have added these under the Other Resources section above, but wanted to give Mark proper credit. Thanks Mark!!