Work with accounting periods and fiscal years

Accounting periods, also known as reporting periods, are periods of time for which a company or organization reports financial performance by generating, for example, their income statement or balance sheet. Typically, accounting periods refer to the company's fiscal year, which can contain several accounting periods, such as months or quarters.

For many companies the fiscal year doesn't align with the calendar year, for instance when the fiscal year ends on June 30 rather than December 31. For newly created companies, the fiscal year might even actually be longer than 12 months.

Business Central only requires accounting periods if you want to close an income statement, or run data compression tasks.

You can use accounting periods in reporting such as when you're reviewing posted entries on the Balance/Budget page where the reporting interval is specified. One of the options you might specify is to report by accounting period. You can also build a financial report that compares results for different accounting periods.

Creating a new fiscal year

You can create accounting periods in bulk by using the Create Fiscal Year batch job, or by doing so manually.

How to create accounting periods in bulk

Use the Create Fiscal Year batch job to divide a fiscal year into periods of equal length.

Choose the icon, enter Accounting Periods, then choose the related link.
Choose the Create Year action.
In the Starting Date field, enter the date on which the fiscal year starts.
In the No. of Periods field, enter the number of accounting periods to divide the fiscal year into. There can be up to 365 periods in a year.
In the Period Length field, enter a duration for each period. Duration identifiers include 1M for one month, 1Q for one quarter, and 1Y for one year.
Choose OK.

How to create accounting periods manually

If the accounting periods in your fiscal year have different durations, such as the 4-4-5 calendar used in retail, you can manually set it up.

Choose the icon, enter Accounting Periods, then choose the related link.
In the Starting Date field, enter the date on which the fiscal year starts. The Name field will show the name of the month.
Choose the New Fiscal Year check box to indicate that this is the first period in the year. Business Central will use this period to determine which periods to close at year-end.
Repeat steps 2 and 3 for each remaining period.

Closing a fiscal year

Closing the fiscal year is one of the tasks for closing the books. After you close a fiscal year, the Closed and Date Locked check boxes are selected for all periods in the year. You can't reopen a year or clear the check boxes.

Note

Note:
You must always have at least one open fiscal year. When closing a year, ensure that a new year has been created. Also, note that after you close one year, you cannot change the starting date of the following year.

Choose the icon, enter Accounting Periods, and then choose the related link.
Choose the Close Year action.

Posting entries to a closed fiscal year

Although a fiscal year is closed, you can still post general ledger entries to it. When you do, the entries are marked as posted to a closed fiscal year and the Prior Year Entry check box is selected. By default, the check box isn't displayed on the page, but you can add it. The next steps are to close the income statement accounts and transfer the year's results to an account in the balance sheet. Repeat these steps each time you post entries to a closed fiscal year.

Search Results for