Step 1: Complete All Transactions
Before closing a fiscal year, all transactions must be completed for that year. For example, if you intend to close the 2008 fiscal year, complete all transactions dated 1/1/08 to 12/31/08 (assuming the fiscal year structure matches the calendar year) before closing the year.
Step 2: Fixed Assets Year-End Procedures
The following information applies only if you are using FAS for Peachtree with Peachtree Complete Accounting.
Installing the Latest Peachtree Fixed Assets Tax Update Service
Occasionally, the IRS will change or modify fixed asset regulations and depreciation limits for the calendar (tax) year. The FAS for Peachtree Tax Service includes such changes to ensure compliance with the IRS.
Please refer to the tax bulletin that accompanies your FAS Tax Update Service for detailed information on these changes. Only members of the FAS for Peachtree Tax Update Service will receive a Fixed Asset update. Subscribing to the FAS Tax Update Service is necessary for regulatory compliance.
For more information on subscribing to the service and loading updates, see page 2.
Closing Fixed Assets
There are certain procedures that must be completed at the end of a tax year in FAS for Peachtree.
Calculate and Post Fixed Asset Depreciation Amounts for Each Accounting Period before Closing the Current Fiscal Year
All Fixed Asset deprecations must be calculated and posted to the General Ledger before closing the fiscal year in Peachtree. Final depreciation amounts for the current tax year must be included in the Peachtree General Ledger and financial statements before closing the fiscal year. Depreciation should be calculated in Fixed Assets every accounting period.
1 Open FAS for Peachtree (if it is not already open).
2 Make all necessary additions, changes, deletions, and dispositions of assets you have set up.
Any changes to the asset master file relative to adding new assets, changing existing assets, erasing asset records, or disposing of assets for current tax year must be completed at this point.
3 Verify that the Month Fiscal Year-End is accurate. In FAS for Peachtree, this field is on the Book Defaults page (File menu, Edit Company).
General Ledger Year-End Checklist
Closing Fixed Assets
4 If you subscribe to the FAS for Peachtree Tax UpdateService and received an update, it must be installed before calculating the final Fixed Asset depreciation for the current tax year. Please refer to the FAS Tax UpdateService bulletin that accompanies your Tax Update for detailed information on government changes to depreciation calculations and asset limits.
5 Calculate and post the depreciation to Peachtree General Ledger for each month through the end of the tax year. For example, you must calculate each month in 2008 before posting to the Peachtree General Ledger and closing the 2008 fiscal year.
Peachtree highly recommends that each month be calculated and posted to the General Ledger separately.
• In Peachtree Complete, Premium, or Quantum, change accounting periods to the first accounting period of the current tax year. From the Peachtree Tasks menu, select System, then Change Accounting Period.
• In your fixed assets program, calculate depreciation for the first month of the tax year and post. In FAS for Peachtree, select Depreciate (and after that, Post Depreciation) from the Depreciation menu.
• Calculate Fixed Asset depreciation for the payroll and fiscal year you are about to close. This is needed to ensure accuracy of depreciation calculations for both the current and new calendar years. Please refer to the Help file in FAS.
• Repeat the above steps for each accounting period through the end of the tax year.
6 From the Fixed Assets Reports menu, select and print all reports needed for 2008 or the year you are ending or about to close in Peachtree.
7 Make a separate and complete backup of your company data files.
Depreciation for the first period of the new tax year can now be calculated and posted to the Peachtree General Ledger.
Step 3: Reconcile G/L Accounts
You cannot reconcile accounts (for example, checking or credit card accounts) whose bank statements are dated in a closed fiscal year.
Therefore, we recommend that you reconcile these accounts before closing the fiscal year.
If you choose to not reconcile accounts using previous bank statements, the items will be available to clear in the new fiscal year. However, the account reconciliation will be difficult to manage and audit.
For more information on reconciling accounts and using account reconciliation reports, refer to the “General Journal and Banking Tasks” chapter of the Peachtree User’s Guide.
Step 4: Printing Year-End Reports Checklist
The following is a list of reports Peachtree recommends that you print prior to closing the fiscal year. Keep these reports in a secure location.
These reports will act as a hard copy of your historical Peachtree information; they can be helpful during audits. Place a check mark next to each completed task (if applicable).
________ Accounts Receivable—Print reports such as Sales Journal, Cash Receipts Journal, Customer Ledgers, Customer Statements, Aged Receivables, Taxable/Exempt Sales, and the Invoice Register.
________ Accounts Payable—Print reports such as Check Register, Aged Payables, and 1099 Forms.
________ General Ledger—Print reports such as G/L Trial Balance and General Ledger report.
________ Financial Statements—Print reports such as Balance Sheet, Cash Flow, and Income Statement.
________ Payroll—Print reports such as Payroll Check Register, Quarterly Earnings Report, Yearly Earnings Report, Payroll Tax Reports, State Quarterly Report Forms and Federal Forms (940, 941, W-2, and W-3).
________ Inventory—Print reports such as Inventory Valuation Report, Item Costing Report, Inventory Unit Activity Report, and the Inventory Profitability Report.
General Ledger Year-End Checklist
Step 5: Audit Reports and Make Adjustments
________ Jobs—Print reports such as Job Ledgers, Job Profitability Report, and Job Register.
The General Ledger, Financial Statements, and Payroll Reports cannot be printed for a closed payroll or fiscal year.
For more information on printing reports or forms, refer to the Peachtree User’s Guide.
Step 5: Audit Reports and Make Adjustments
Usually in the last accounting period of a fiscal year you need to make adjusting entries. These might include the following:
• Write off customer bad debts
• Record old outstanding checks re-entered back into the bank account as miscellaneous income
• Verify that fixed asset purchases and dispositions have been properly recorded
• Record depreciation expenses
• Record a physical inventory count and compare to Peachtree's quantity on hand
• Manage outstanding notes payable and receivable items and recording or adjusting interest expense or income
Once the above adjustments have been made (if necessary), you are ready to begin closing the fiscal year. The type of adjustment required depends on where in Peachtree the correction needs to be made.
• General Ledger adjustments are entered in the General Journal.
• Inventory adjustments are entered in the Inventory Adjustments Journal.
• Payroll adjustments can be made through Payroll Entry.
• Accounts Receivable adjustments can be made through Sales/
Invoicing or Receipts.
• Accounts Payable adjustments can be made through Purchases or Payments.
After you have made the necessary adjustments, reprint any affected reports so that you have a correct copy. You can run the Internal Accounting Review to help you identify potential discrepancies and items that might be audited. To run this feature, select Reports, then Internal Accounting
Note
Step 6: Close Fiscal Year
Peachtree refers to the fiscal year as the year in which General Ledger transactions take place. Peachtree keeps two years of General Ledger transaction activity open at one time. Each fiscal year has the same number of accounting periods, which you establish when initially setting up your company. Normally, you change accounting periods as you enter transactions. Fiscal years do not have to start at the beginning of the calendar year. For example, some companies may start their fiscal year July 1 and end it June 30.
Peachtree refers to the payroll year as the calendar year in which payroll transactions (earnings) take place. If your fiscal year is operated based on the calendar year (starts January 1 and ends December 31), then you should close the payroll year first before closing the fiscal year.
Before Closing the Fiscal Year
Before you close the fiscal year, if you are using batch posting mode, you need to post and print all journals and the Yearly General Ledger report. Also, you need to print all open invoices, vendor and payroll checks, and back up all of your data. The program will prompt you to perform these functions. If you are using batch mode, the program will not let you continue a fiscal year close until all transactions are posted.
Usually in the last accounting period of a fiscal year you need to make adjusting entries. Once the adjustments have been made (if necessary), you are ready to begin closing the fiscal year.
Close the Fiscal Year
After closing a fiscal year, all transactions posted to the General Ledger in that year cannot be edited. However, these transactions can be viewed if they have not been purged. In addition, ending balances and some limited historic information are available in reports, when requested.
General Ledger Year-End Checklist
Purge Unnecessary Data
Closing the First of the Two Open Fiscal Years
Before you close the fiscal year, you will need to post and print all journals and the Yearly General Ledger report. You should also print all open invoices, vendor and payroll checks, and then back up all of your data. The program will prompt you to perform these functions when you use the Year End Wizard. If you are using batch mode, the program won't let you continue a fiscal year close until all transactions are posted.
1 From the Tasks menu, select System, then Year-End Wizard.
It is important that you never shut off your
computer during the close-year procedure. Also, the process may take some time, depending on your computer system, memory, and size of data. Peachtree recommends that you begin the process at the end of the day so it will not interfere with your regular workday. If your company has data in excess of 50MB, you should begin the close prior to leaving for a weekend or holiday.
2 Peachtree may show several warnings before beginning the close process if your company data meets certain conditions. These could include
• You may get a message that if Payroll or vendor 1099s are being used, you must close the payroll year first. Select No or Cancel if you haven't closed the payroll year and you need to.
• You may get a message saying you should print invoices or checks before closing the year. This means you have paychecks or customer invoices that do not have reference numbers assigned in the year that is about to close.
3 Follow the wizard screens to continue closing your fiscal year. Refer to “The Wizard Windows” on page 40 for more about using the Year-End Wizard.
Purge Unnecessary Data
Purging is the process of removing inactive customers, vendors, employees, quotes, invoices, purchases, and so on, from the records of a company. Purging reduces the size of the files of a company and frees valuable disk space for current and active data. This is usually recommended after closing a fiscal year, to save disk space and to improve system responsiveness and speed. For each type of transaction
Warning
For more information about purging, look up Purge wizard, overview in the Peachtree Help index.
Troubleshooting Fiscal Year End
Here are some common error messages you could receive during fiscal year-end procedures, and how to correct them.
You Must Post and Print Before Closing
If you are using Batch posting, go to the Tasks menu and select System, and then select Post. From the Post window, choose All Journals, and then click OK.
If you are using Real-time or SmartPosting (Peachtree Quantum only) posting, go to the Maintain menu and select Company
Information. Click the Posting Method arrow button, select the Batch posting method, and click OK. Select OK to close the Maintain Company Information window. From the Tasks menu, select System, and then select Post. From the Post window, choose All Journals, and then click OK.
If posting All Journals does not work, try posting each individual journal.
If you have posted all journals and the problem persists, follow the steps below:
1 Make sure that Peachtree is closed on your machine.
2 Start Peachtree with Integrity Check:
You should be on the latest batch update of Peachtree before running integrity checks. You can verify this by using the Online Update feature or by visiting www.peachtree.com on the Web.
For the procedure for running the online update, see “Checking for and Installing Online Tax Updates” on page 19. The procedure is the same for other types of product updates.
➤ In Windows 2000, XP, or Vista: Click once on the Peachtree Icon.
Next right click to Properties. On the Shortcut tab and then target path line, click the cursor behind the last character then type (space) -i.
This will load Peachtree with two new options under the FILE menu.
Never choose these options without being instructed to do so by a Peachtree Technical Support representative.
Troubleshooting Fiscal Year End
Purge Unnecessary Data
3 Change to Period 1.
4 Choose File, and then select Integrity Check.
5 Choose to make a backup.
6 In the Integrity Check window, run these tests:
• Select Reindex Files on the left. Choose Chart on the right, and then click OK.
• Go back to the File menu and select Integrity Check. Click Continue.
The journal file is divided into two files— jrnlheader and jrnlrow.
Each of these files should be reindexed.
• Select Reindex Files on the left, choose Jrnl Header, and click OK. Repeat the process, selecting Jrnl Rows.
• Return to the File menu and choose Integrity Check. Select Continue.
• Select Chart of Accounts/Journal under the Data Synchronization Tests, and then click OK.
If this still did not help, it’s possible that Beginning Balances were not posted correctly. Follow the steps below. This may be a lengthy procedure. Do not interrupt the process.
1 Make sure you are using the batch posting method.
From the Maintain menu, select Company Information. Click the Posting Method arrow button, select the Batch posting method, and then click OK. Select OK to close the Maintain Company Information window.
2 Change your accounting period to Period 1.
From the Tasks menu, select System, and then select Change Accounting Period. Select Period 1 from the Open Accounting Periods box and then click OK.
3 From the Tasks menu, select System, and then select Unpost.
4 Clear the All Journals checkbox, and then select each individual journal box.
Each journal should have a checkmark beside it, (except for the All Journals option).
5 Click OK.
This will unpost each journal, one at a time.
6 When the unposting is completed, go to the Maintain menu and select Chart of Accounts. Click the Beginning Balances arrow button.
7 Select the period in which you entered Beginning Balances, and then click OK.
8 In the Beginning Balance screen, press and hold down the Enter key.
Keep holding down the Enter key to scroll through the accounts.
9 When you reach the end, release the Enter key. Answer Yes to save the beginning balances.
10 When finished, go to the Tasks menu and select System, Post, and then OK. When completed, try closing again.
Periods Not Updating When Closing Fiscal Year
This error message indicates that the closing of the fiscal year is encountering a problem assigning new period numbers to each transaction in the system. Follow the steps below to resolve the problem.
1 Restore the backup made before you attempted to close the fiscal year.
2 From the Help menu, select Help, Customer Support and Service, and File Statistics.
3 The title bar of this window will say, “Data File Statistics for XXXX”
where XXXX is your company's folder name in Windows. Write this name down.
4 Exit Peachtree.
5 From the Start menu, select Programs, and then choose Windows Explorer.
6 Find your company folder under the Peachtree directory on the drive where your data is stored.
7 In this directory, there should only be files ending in .DAT, .PTB, .DDF, .RPT, .PWP, and .FRM, as well as a VERSION.TXT, DETAILS.INI, *.PRT, and ~PVSW~.LOC. If you see any other extensions or files, delete those files.
Troubleshooting Fiscal Year End
Purge Unnecessary Data
Tip: Other files that may cause problems and may be deleted include the following: JRNLCLS.DAT, files whose filenames include a dash or an underscore, STATUS.DAT, OPTIONS.DAT, SERIAL.DAT,ENVUSER.DAT, ENVSESS.DAT, and
PEACHTDAT.LOC.
8 Run the Data Verfication procedure. Go to File, Data Verification.
9 Choose the option to run Both Tests, and click Start.
10 Make a backup to a secure location. If you do not make a backup, the test will not complete.
11 Once the backup has finished, the Data Verification test will begin automatically.
12 Once the Data Verification is complete, close the dialog box and attempt to close your fiscal year. If it still fails, continue the steps below:
13 Follow the steps below to run a test on your data:
• Load Peachtree with Integrity Check
You should be on the latest batch update of Peachtree before running integrity checks. You can verify this by using the Online Update feature or by visiting www.peachtree.com on the Web.
➤ In Windows 2000, XP, or Vista: Click once on the Peachtree Icon.
Next right click to properties. On the Shortcut tab and then target path line, click the cursor behind the last character then type (space) -i.
This will load Peachtree with two new options under the FILE menu.
Never choose these options without being instructed to do so by a Peachtree Technical Support representative.
• From the Tasks menu, select System, and then Change Accounting Period. Change the accounting period to Period 1.
• From the File menu, select Integrity Check.
• Choose to make a backup.
The journal file is divided into two files— jrnlheader and jrnlrow.
Each of these files should be reindexed.
• Select Reindex Files on the left, choose Jrnl Header, and click OK. Repeat the process, selecting Jrnl Rows.
• Return to the File menu and choose Integrity Check. Click
• Select Inventory/Journal under the Data Synchronization Tests, and then click OK.
This test may take a while. Take note of any errors encountered.
• When finished, change back to period 13 and try closing the fiscal year.
No Transactions Under Open After Fiscal Year Close After closing the fiscal year, the transactions for each period do not show in Open/List unless you choose to show All Transactions.
Follow these instructions to fix this problem:
1 Restore the backup you made prior to closing the Fiscal Year.
2 From Windows Explorer or File Manager, open your company data folder.
If you are not sure which folder is your company data folder, open
If you are not sure which folder is your company data folder, open