To access the Month-End Closing service tool, go to Accounting > Service Tools > Month-End Closing.
The month-end closing is a process used to automatically generate specific documents, verify and adjust the balances of GL accounts at the end of the selected period. The tool is also used to close the financial year.
On the form, you can view statuses of the current year's periods. For each month, you can view which processes were selected for execution and whether these processes were executed successfully.
Green circles (
) mark the closed months, that is, the months for which the process of month closing had been executed successfully.
Yellow warning triangles (
) mark the months for which the month closing process was not performed successfully and might need manual adjustments.
Note. If the process ends with errors, you may need to run the Trial Balance for Account report and review the documents related to the period, making sure that they are posted and corresponding tax documents are generated and posted too.
The Month-End Closing form
The form provides all the available options for the month-end closing service tool. Using this form, you can select the year for period closing by using the "earlier year (<<)" button to the left and the "later year (>>)" button to the right. The figure in the center designates the selected year.
In the For the Entity field, you can select the entity for which you want to run the closing process.
In the left column (grey background color) you can select the month for processing.
Note. In FirstBIT ERP, if needed, you can open any of previously closed months—for this, click the Cancel Month-End Closing button and make necessary changes to the period-related documents. Then, you must again perform month-end closing for that month and each of the later months.
For the selected month (indicated by white background), you can view which of the available processes you must run (
) and which are not required.
The following options (processes) are available.
Process | Description |
Calculate Depreciation | Available if the Enable Depreciation of Non-Current Assets option is selected on the Administration > Settings > Asset Management form. If this option is selected, the Fixed Asset Depreciation documents are generated according to the depreciation methods assigned to fixed assets. For more information, refer to Overview of Depreciation of Fixed Assets. |
Calculate Current Revenue for Deferrals | Available if the Enable Deferred Revenues option is selected on the Administration > Settings > General Settings form. If this option is selected, the Revenue Recognition document is generated for deferrals with the By Month and By Calendar Days calculation methods. The generated document lists the deferred revenues for which the specific amounts calculated by these methods should be recognized as actual revenues in the month to be closed. For more information, see Deferrals. |
Calculate Current Expenses for Deferrals | Available if the Enable Deferred Expenses option is selected on the Administration > Settings > General Settings form. If this option is selected, the Expenses Recognition document is generated for deferrals with the By Month and By Calendar Days calculation methods. The generated document lists the deferred expenses for which the specific amounts calculated by these methods should be recognized as actual expenses in the current month. For more information, see Deferrals. |
Calculate Monthly Interest on Loans | Available if the Enable Long-Term Credits and Loans option is selected on the Administration > Settings > General Settings form. If this option is selected, the Processing of Current Loans document is generated for the loans received and issued. The generated document lists each loan with the monthly interest and fee amounts that will be posted as expenses or incomes incurred in the current month. For more information, see Processing of Current Loans. |
Calculate End-of-Service Benefits | Available if the Enable End-of-Service Benefits Calculation option is selected on the Administration > Settings > HR and Payroll form. If this option is selected, the End-of-Service Benefit Calculation documents are generated; each document lists the employees who are not listed in any EoSB document for which the Manual Processing option is selected. For more information, see Overview of End-of-Service Benefit Processing. |
| Calculate Accumulated Vacation Pay | The Calculations of Accumulated Vacation Pay documents are automatically generated by the Month-End Closing service tool if there is at least one employee with a vacation for which the Accumulate Vacation Pay option is selected in the HR and Payroll > HR Documents > Employment Contract or Employment Contract Change document. If this option is selected, the amounts corresponding to vacation days earned each month will be accrued in specific GL account until paid to the employee as a vacation payout or loan repayment. The employees listed in any document for which the Manual Processing option is selected are not included in the automatically generated document for the same period. For more information, see Overview of Vacations. |
Calculate Exchange Rate Differences | If this option is selected, the system calculates the realized and unrealized gains and losses (exchange rate differences) due to fluctuations of exchange rates of foreign currencies with respect to the national currency. If the Calculate Exchange Rate Differences only on Month Closing option is selected on the Administration > Settings > Service Settings form, the exchange rate differences will be calculated only during the month-end closing process. Otherwise, they will be calculated on posting of any new foreign-currency document and adjusted on the date of the month end. For more details on this calculation, refer to Overview of Calculation of Exchange Rate Differences. |
Calculate Direct Costs | If this option is selected, the system calculates the weighted average costs of the ending inventory based on the inventory beginning balances, production and purchases during the period and then adjusts the costs of sold goods for each transaction recorded and posted during the period including customer returns. For more details, refer to Overview of Cost Calculation. |
Allocate Costs | Allocates specific expenses to the Cost of Goods/Services account. Also, if the Production module is enabled and appropriate cost allocation settings are defined, the system allocates specific indirect costs and work-in-progress amounts to costs of finished goods by using the available cost allocation methods. For details, refer to Overview of Cost Allocations. |
Calculate Actual Costs | If this option is selected, the system adjusts the costs of the inventory and finished goods based on the direct costs and allocated costs; recalculates the costs of sold goods and services for each transaction recorded and posted during the period. For more details, refer to Overview of Cost Calculation. |
Calculate Vacation Days | Calculates vacation days available for the employees based on the vacation types and vacation settings in corresponding Employment Contracts. For details, refer to Overview of Vacations. |
Calculate Financial Result | Executes allocations of the Profit and Loss type and calculates the financial result, that is a profit or loss made by the company during the month, after all the allocations are executed. For details, refer to Overview of Cost Allocations. |
Note. The generated documents are posted automatically. For each month, there can be only one automatically created document of each type. If the month closing process is run repeatedly, the automatically created document will be overwritten.
The toolbar buttons
The form toolbar contains the following buttons:
- Execute Month-End Closing: Click this button to run the month-end process and generate the related documents (for which the corresponding options are selected).
- Cancel Month-End Closing: Click this button if you want to cancel the month-end closing process.
- Report: Click this button to generate the Month-End Closing report which shows the details of the process and the errors incurred if any.
Links to Related Documents
Documents of the following types are generated in the process of month-end closing:
- Main: Opens the Month-End Closing form (this form) so that you can run the closing process again after you manually corrected the errors if any.
- Month-End Closing Documents: Opens the list of documents of this type generated during each execution of the month-end closing process.
- Fixed Asset Depreciation Documents: Opens the list of documents generated for the closing process with the Calculate Depreciation option selected.
- Revenue Recognition Documents: Opens the list of documents of the corresponding type, generated with Calculate Current Revenue for Deferrals option selected.
- Expense Recognition Documents: Opens the list of documents of the corresponding type, generated if the Calculate Current Expenses for Deferrals option was selected.
- End-of-Service Benefit Calculation Documents: Opens the list of documents of the corresponding type, generated if the Calculate End-of-Service Benefits option was selected.
See also