I did my year end close of the General Ledger and discovered that two of my P&L accounts were classified as Balance Sheet and did not close out to Retained Earnings.
How can I correct this error?
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WennSoft,
We do our level best to prevent this situation from happening in the first place by creating a couple of SmartLists in the Financial > Account SmartList Folder. Add the Main Account Segment column and Posting Type. Search these columns for account numbers greater than 3999 (or your highest Equity/Balance Sheet Account), with Posting Type of Balance Sheet. Then save this SmartList with a Reminder, when it has a greater than zero results.
It is most common for new expense accounts being created to be classified erroneously as Balance Sheet posting type accounts, because this is the default. To be thorough, you can do the same things for Balance Sheet accounts that might be incorrectly classified as Income Statement accounts by searching for accounts less than 4000 (or your lowest Revenue/Income Statement Account), with a Posting Type of Income Statement.
By setting these SmartLists to have reminders, problem accounts should pop up, as they are added. You should also add a step to your year-end close procedure to check these SmartLists to be sure.
As a user I have stumbled into this several times. Follow the KB article as suggested and you'll be fine.
One thing we do as part of the system close process. After the final closing JEs are posted from the auditors. We run a GL Account report that shows which accounts are B/S and which are P & L. A bit tedious if you have a large COA or a number of companies. If you see an account flagged wrong just change it on the Card. In the long run it is well worth the time.
The last client I helped through this problem with the referenced KB Article was on GP 2010, and had closed the year with multiple PNL accounts, which were classified as Balance Sheet accounts. It worked as anticipated. Make sure you take a back up, and try the process in your test company.
That is very unfortunate - so I have to agree with Harry - the best solution will be to follow the guidance in the link he has attached.
We have over the years been very happy with the results of this fix. New method of course is way better - but no use crying over spilled milk.
Hope this helps.
They are on Dynamics GP 2010.
I have helped clients in the past using the approach laid out in the following KB article. This is your best bet, if you're not on the latest release of Dynamics GP.
I agree with bill, Yes this feature is available from GP2013 R2. Now users will have the ability to reverse the GL Year End Close Process in order to open the previous fiscal year.
Note: Take a proper backup prior to performing the reversal process.
What version of GP are you running?
There is a new option to GP that allows you to 'reverse the year end close' and this is a case that I might consider worthy of using the tools provided by Microsoft.
Once you have reversed the Year End Close - which effect GL only - then make the necessary changes to the accounts and 'reclose' the year.
Hope this helps.
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