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Managing Accounting Periods

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AVAILABLE FROM CRM.COM R10.0.0

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Table of Contents

Navigating to Accounting Periods

 CONFIGURATION > FINANCE APPLICATION > ACCOUNTING PERIODS > MANAGE ACCOUNTING PERIODS

Using Accounting Periods

An Accounting Period is defined as the time frame in which Financial Transactions are posted. An Accounting Period in CRM.COM can cover either a month or a year (according to set up in Accounting Period Settings) and can be either 'Open' or 'Closed'.  However, only one Accounting Period can be 'Open' at a time and it will always be the latest one. 

The first Accounting Period is automatically created by the system on specifying Accounting Period Settings.   The following Accounting Periods are created once the current Accounting Period is closed (via Closing Period process). Once an Accounting Period is closed it cannot be reopened and no more Financial Transactions can be posted against it, as Financial Transactions can only be posted against 'Open' Accounting Periods and can only be related to a single Accounting Period. 

Before closing a Period, you have the option to find all Financial Transactions that have been created during the 'Open' period and have them posted so that they will be included in the period you are about to close. This is done via the Accounting Period Posting process.

A utility is available to identify and correct incorrect data, such as Financial Transactions with wrong Periods. It is recommended to execute the utility before closing the Period as any errors found while closing will interrupt the process.

In case the closing period is interrupted, you can use the Correction process (i.e. if for any reason the scheduler, responsible for executing the process is is stopped, and there are still open transactions, use the Correction Process)

The closing of an Accounting Period will also trigger the calculation of the account's Opening Balance which is used in the balance calculation. 

Validations & Restrictions Table

Action
Restrictions
Validations
Additional Information
Create
  • Not Applicable

 

Close
  •  You can only close Open Accounting Periods
  • Accounting Period Settings  are defined
  • If Accounting Periods already exist, then
    • There must be at least one Accounting Period registered in the system and it is in 'Open' Life Cycle State. The process cannot be performed for already closed Accounting Periods.
    • The open Accounting Period's end date is before the process run's performed date.
  • The Closing process will be executed by the scheduler and will either take place right away or be scheduled for the future, but it cannot be scheduled to be executed repeatedly.
  • 'Terminated' Accounts Receivables will also be considered during the closing, as long as posted Financial Transactions were submitted against these Accounts Receivables and are not yet related to any Accounting Period. 
    The Financial Transactions in question might have been submitted against the Accounts Receivable prior to its termination but still have to be related to an Accounting Period.
  • An Error Log is available to register all Accounts Receivables or Financial Transactions that could not be processed.
Modify
  • Accounting Periods cannot be modified
  • Not Applicable
  • Not Applicable
Open
  • Closed Accounting Periods cannot be re-opened
  • Not Applicable
  • Not Applicable
Delete
  • Accounting Periods cannot be deleted
  • Not Applicable
  • Not Applicable

 

Attributes Table

 An * indicates a field is mandatory

Name

Description

Main Information
Number  The Accounting Period's number which consists of the Accounting Period's month and year (e.g. 201601 for January 2016 if the Accounting Period is monthly, or 2016 if it is annual).
NameThe Accounting Period's name which consists of the Accounting Period's month and year (e.g. January 2016).
From dateThe first day of the Accounting Period's month
To dateThe last day of the Accounting Period's month
Life Cycle State

The Accounting Period's Life Cycle State. Its two values are:

  • 'Open'
  • 'Closed'
Closed dateThe date on which the Accounting Period was closed, available only if the Accounting Period's Life Cycle State is set to 'Closed'.
Closed by Accounting PeriodThe Accounting Period which follows the current Accounting Period. This information is mandatory as long as the current Accounting Period's Life Cycle State is set to 'Closed'.
Period closing performed by user

The name/number of the User who initiated the Accounting Period Closing process that triggered this Accounting Period's update to a 'Closed' Life Cycle State.

This information is available only if the Accounting Period's Life Cycle State is set to 'Closed'.

Accounting Period Totals

Section with all the related information

  • Total Amount of Debits
  • Total Amount of Credits
  • Total Amount of Period
  • Total Number of Debit Transactions
  • Total Number of Credit Transactions
  • Total Number of Financial Transactions
Period Transactions
Lists all Financial Transactions which were considered during the Accounting Period's closing process (i.e. related to the Accounting Period) is displayed in 'Read-only' mode
Section is only visible for 'Closed' periods 
Financial Transactions
  • Number
  • Reference Number
  • Account Information
  • Type
  • Issue Date
  • Posted Date
  • Total Amount

Draft Transactions

Lists all Financial Transactions created during the period's time frame that are still in 'Draft' state, in 'Read-only' mode.

Section is only visible for 'Open' periods 

Financial Transactions
  • Reference Number
  • Account Information
  • Type
  • Life Cycle State
  • Issue Date
  • Total Amount
Accounting Period Error Logs
Accounting Period Closing Error LogsA list of Αccounts Receivable which were not successfully processed during the Accounting Period Closing process run
This list includes Accounts Receivables which have posted Financial Transactions, with posting date within the Accounting Period's time frame which are not related to the Accounting Period.
Log Information
Log Information

The standard set of Log Details information available in all entities  

Posting Financial Transactions to include in Current Period

All Financial Transactions that should be included in the period must be posted before it closes, or will not be considered.

Once the period is closed, transactions against that period can no longer be posted

Draft Financial Transactions created within the time frame of a specific period can be accessed, selected and posted via the Accounting Period view of an 'Open' period.

  1. Navigate to the Accounting Period screen
  2. Search for the 'Open' Period and go to its data entry screen
  3. Go to the Draft Transactions Section
    All the eligible transactions will be available
  4. Select the ones you want to include by placing a check in the checkbox
  5. Click on Actions > Post from the Actions menu

OPEN PERIODS DATA ENTRY SCREEN

Correcting data before closing an Accounting Period 

Once the transactions to be included in the period are posted, the Financial Transactions and Accounts Receivable which will be considered by the Closing process can be checked. This is done through the Accounting Period's Closing Validation Process which is responsible for retrieving and fixing incorrect information that affect an Accounting Period's Closing process. This incorrect information might be related to either Financial Transactions and/or Accounts Receivable and can be found in the table below.

It is recommended to skip this step and proceed directly to the Closing of the period. The system will run a check, and if necessary will notify the user to run the Correction step.

It is not mandatory to execute the Accounting Period's Closing Validation Process before closing a period. However, if any errors are identified while closing the period the system will stop until the process is explicitly executed.

  1. Navigate to the Accounting Period screen
  2. Search for the 'Open' Period and go to its data entry screen
  3. Click on Actions > Period Closing Corrections from the Actions menu
    The process will run and you will be notified once it is completed so that you can proceed to the closing of the period 

Accounting Period's Closing Validation Process

Identified ErrorsCorrections
  • Find all Financial Transactions which are:
    • Not Posted and 
    • Have an Accounting Period
  • Their Accounting Period is set to empty
  • Find all Financial Transactions which are:
    • Not related to an Accounting Period and
    • are Posted and 
    • have a posting date before the Accounting Period's start date (exclusive)
  • The appropriate Accounting Period is set on the Financial Transaction
  • The opening balance of the account is recalculated to include the Financial Transaction's amount 
    • If the Financial Transaction is a Debit, the Accounts Receivable Balance is increased by the same amount as the Financial Transaction's total
    • If the Financial Transaction is a Credit, the Accounts Receivable Balance is decreased by the same amount as the Financial Transaction's total
  • Find all Financial Transactions which are:
    • Posted and
    • have a posting date that does not fall within their related Accounting Period's time frame (including the related Accounting Period's start/end date) and
    • Their posting date is before the start date (exclusive) of the Accounting Period which is being closed
  • The appropriate Accounting Period is set on the Financial Transaction
  • Find all Accounts Receivable which are:
    • Not related to the Accounting Period being closed and
    • Have a creation date before the Accounting Period's start date (exclusive) and
    • Have at least one posted financial transaction with a posting date before the accounting period's start date (exclusive)
  • The opening balance for the Accounting Period which is about to close is recalculated by using the following formula:
    • (Sum up all posted debit transactions) - (Sum of all posted credit transactions) which were submitted against the Accounts Receivable and have a posting date before the Accounting Period's start date (exclusive)
    • Set the opening balance, opening balance calculation date and Accounting Period on these Financial Transactions

 

Closing an Accounting Period 

Given that Financial Transactions and Accounts Receivable are correct then you can proceed with closing the Accounting Period.

  1. Navigate to the Accounting Period screen
  2. Search for the 'Open' Period and go to its data entry screen
  3. Click on Actions > Close Period from the Actions menu
    CLOSE PERIOD ACTION
    1. From the modal window select whether you would like to execute the process now or schedule it for some time in the future
    2. Click on Submit.  Once submitted, the process will run as scheduled. 
  4. When the process is completed:
    1. The Accounting Period Totals tab is populated
    2. The Current Period is closed
    3. The period is copied on all Financial Transactions posted within this period
    4. A New Period is created
    5. The opening Balance of all Accounts Receivable is calculated

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