Year End Processing

At the beginning of a new fiscal year, the year-to-date retained earnings from the previous year must be closed into the inception-to-date retained earning.  This can be done either automatically or manually, depending on a flag on Reference File category P01.

If the auto close retained earnings flag is set to 'Y', during the first post of the new year the program will automatically close the previous year's year-to-date retained earnings balance into the inception-to-date retained earnings account.  These amounts are posted without generating a transaction.  See the note in the Posting Transaction for Retained Earnings Account Key Concept in this manual.

If the auto close retained earnings flag is set to 'N', you must enter a manual journal in the first period of the new year to transfer the balance of the previous year's retained earnings from the year-to-date retained earnings account to the inception-to-date account.  If this transfer is not performed, your financial statements will show a rounding record as a cross check to verify that the year-to-date retained earnings account balance accurately reflects the earnings for the year.