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Small and medium business | Business Central, N...
Answered

Closing Accounting Periods to restrict postings

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Posted on by 1,165

Hi All,

We notice that even after closing accounting periods users can still post to closed periods as long as date range is allowed in General Ledger setup (or under user).  So my question, What's the point of closing accounting periods? What benefits do we get by having accounting periods and closing them? 

Thanks

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  • Suggested answer
    CarlHead Profile Picture
    95 on at

    Closing accounting periods is for closing years. Postings into closed periods will be marked as "prior period" postings for audit purposes.

  • Anita75 Profile Picture
    1,165 on at

    Thanks So is this the only useful benefit from closing process or is there any other validations or warnings. Reason behind this question is that the period setting in BC is rather different to many other accounting systems I have used and want to understand better

  • Verified answer
    CarlHead Profile Picture
    95 on at

    Yes it is different to other accounting systems, as you have much better flexibility in terms of posting audit journals and the like. Best practice is to close your financial years in line with posting your income statement closing journals.

    Also, as a side note; if you are using inventory, you should be closing your inventory periods aligned with your periodic (usually monthly) reporting periods, so BC doesn't update your Cost of Sales in the old period.

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