Initialization of the Next Accounting Period Function

Initialization of the Next Accounting Period
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For the application to function correctly in the new accounting period, closing and initialization operations must be performed. How to close a period is described below; additional information is available in the chapter Year-End Closing and Creating a New Accounting Period. One of the key steps is:

Accounting – Initialize Next Accounting Period (can be repeated)

The form closes the given accounting period and carries the account balances forward to the next accounting period as opening balances. The initialization must be repeated whenever a change is made in the given period — for example, when correcting an issued invoice for 2019.

This option transfers the required balances to the new year while still allowing you to make corrections in the previous period. You can run this option repeatedly as needed. There is no risk of duplicate closing operations being created.

Accounting period closing wizard.
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After selecting the "Initialize Next Accounting Period" option in the "Accounting" module, the application displays a dialog for defining the required parameters.

Accounting Closing Operations

Define the accounts for the following operations:

Inventory Transfer

If you want to initialize opening inventory balances in the new accounting period, check this option. The application will make the following parameters available for the initialization.

Skip Cards with Zero Balance

Cards with a zero balance in both unit quantity and monetary value will not be transferred.

Number of Days Without Movement for Exclusion

This option is related to the previous parameter. It sets the minimum "age" of unused cards. This prevents a situation where a goods/material card is "emptied" a week before the period closes and the application would then not carry it forward for further use.

Confirm Exclusion of Card

This option allows you to "monitor" the transfer process and individually control which cards should be skipped. This transfer method is not suitable when the inventory contains thousands of items.

Remove Unused Old Cards in the New Accounting Period

This option allows you to remove cards from the new accounting period that were transferred there by mistake. An example would be transferring the entire inventory without excluding old slow-moving items, and then needing to correct that error.

Leasing

Lease installment liabilities are generated separately for each accounting period.

Document Type for Generating Lease Installment Liabilities

The liability document type allows you to define, for each accounting period, the posting parameters and the method for generating the internal document number.

Transferring Inventory Status to the Next Accounting Period
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The current inventory status (inventory cards) is maintained in a file that has a separate table for each accounting period. The opening balances of individual cards serve as the starting point for the card's current status within the period. To begin updating cards in the next accounting period, you must activate the Transfer Inventory Status to Next Accounting Period function. This function transfers cards from the current accounting period (AP) to the card file in the following AP.

The closing balances of cards in the current AP are written as opening balances in the new AP. After the transfer to the new AP, situations may arise where you need to make additions or corrections in the old AP. If you do so, you must activate the Transfer Inventory Status to Next Accounting Period function again. The application will transfer the updated card balances to the new AP and, if movements already exist on certain cards in the new AP, it will recalculate their current balances. This means the Year-End function can be run repeatedly, allowing you to update both the old and the new year simultaneously.

Transfer All Cards

The application transfers all cards regardless of their balance and the date of the last movement.

Skip Unused Cards (Zero Balance, No Movement for a Long Time)

There will inevitably be situations where certain items "drop out" of your product range, causing some cards to fall out of use. If you do not want these cards to appear in the new accounting period, use this option.

Number of Days Without Movement

The user enters the number of days without movement (since the last issue slip or transfer). This date is calculated relative to the last day of the accounting period being transferred.

Confirm Skipped Cards

If you enable confirmation, you must individually confirm each card that will not be transferred.

Remove Cards in the New Year That Do Not Exist in the Old Year and Have No Movement

It is possible that you transferred all cards to the new AP and then realized you did not want to transfer cards that had been inactive for a long time. You repeat the transfer and check Skip Unused Cards. By checking the option "Remove unused old cards in the new AP", the application will clean up so-called redundant cards (cards with no movement and no balance).

Closing Operations
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The following operations are performed when closing an accounting period:

Invoice Revaluation

At the end of the accounting period, internal documents must be generated to revalue received and issued invoices in foreign currencies. The Company Parameters settings (see below) specify the internal document types used to "handle" this action. The option can be found under "Company Settings – Accounting – Document type for: Exchange rate differences – income and Document type for: Exchange rate differences – expense".

If any of the required data is missing, the closing operation will report this fact but will not stop. Internal documents will simply not be generated, and the error will be recorded against the accounting period.

It is possible that after the closing a user may change the status of a document or add a new document to the period in question. This makes it necessary to repeat the revaluation and therefore the accounting closing as well.

Closing the Ledger in the Current Period

The application generates turnovers in the closing month (numbered 99) that transfer the closing balances of balance sheet and off-balance sheet accounts to the "Account for Closing the Ledger". Income statement accounts are transferred to the "Account for Transferring Profit/Loss".

Opening the Ledger in the New Period

The application generates turnovers in the opening month (numbered 0) that transfer the opening balances of balance sheet and off-balance sheet accounts from the "Account for Opening the Ledger". The "Account for Transferring Profit/Loss" is carried forward to the "Account for Profit/Loss Under Approval Proceedings".

Creating Inventory Cards for the Next Accounting Period

Inventory balances are tracked separately for each accounting period. It is therefore necessary to set the opening inventory balances for the new accounting period. As a standard practice, work is carried out in two accounting periods simultaneously after the year-end. Changes may occur in the previous period. By repeating the closing, you transfer those changes to the new period.

Initialization of Asset Posting

The application populates the posting date in depreciation entries that fall within the next accounting period. This update results in the depreciation amounts being reflected in the account balances of the new period.

Initialization of Lease Posting

The application populates the posting date in the repayment schedule and tax expense entries that fall within the next accounting period. It also generates other liabilities for installments due in the new accounting period.

The application accepts changes to the end date of an accounting period. It adjusts tax depreciation in accordance with applicable legal regulations. If the accounting period is shortened to less than 12 months, tax depreciation older than one year is reduced by half.