Year End process in Dynamics NAV 2013

There are three steps required for doing the year end process in Dynamic NAV 2016.

1. Open an Accounting period in Window:-

a. Department – Financial Management – Setup-Administration-Accounting Periods
b. Create a New Fiscal Year – Under Accounting Period – Home- Create Year
c. Options will come – Starting Date (Year Start Date
No. of Periods (12)
Period Length (1M)

2. After Created the new fiscal year, close previous fiscal year. For closing the previous
fiscal year click on “Close Year” under the home tap in Accounting period
window and click “yes”.

3. Go for close the income Statement Accounts.

a. Department-Financial Management-Periodic Activities-Fiscal Year-Close Income
Statement
b. Close Income Statement window will open:-
i. Fiscal Year Ending Date – Last date of fiscal year
ii. General Journal Template – Select the template In which batch you want to
put the entry
iii. General Journal Batch – Select the template in which batch you want to put
the entry
iv. Document No. – Will come automatically from number series
v. Retain Earning A/c – Balance Sheet liabilities account
vi. Posting Description – Close Income Statement.

4. After the above steps, the system will create year end entries in the general template
which you have selected under 3-b-ii step, check the entries and post the same.
 FAQs: Year-End Closing in Dynamics NAV

9 FAQs for Year-End Closing in NAV:

1: Does closing accounting periods restrict users from posting into those “closed” periods?

Actually, no. Closing the accounting periods is a way of letting NAV know that you are ready to
run the “Close Income Statement” routine for the most recently closed year. Closing accounting
periods in no way restricts users from making postings into these closed periods. Instead, use the
general ledger setup and/or user setup’s posting date restrictions to restrict users from posting
into the closed fiscal year.

2: Do I close accounting periods one month at a time?

No. In NAV, all periods within the fiscal year are closed at the same time when you run the
“Close Year” function from the “Accounting Periods” page. Periods in NAV are not closed per
month.

3: What do I do if I need to make additional back-postings to a closed year?

Open the posting date restriction up for your user setup record so that you are allowed to post
into the closed year. Next, make the necessary back-postings. If any of these postings hit income
statement accounts, you’ll need to re-run the “Close Income Statement” routine again to wash
these back-postings into retained earnings. Note that all G/L entries posted into a closed year will
have a checkmark in the “Prior-Year Entry” field so that you can later run a report filtered to
only back-posted entries.

4: Why does NAV put a “C” in front of the posting date it assigns to the closing journal?
NAV posts the closing entries with a fictitious date that resides one day after your fiscal year
ending date and one day before your next fiscal year starting date. For example, if you operate
under a calendar year, NAV will post the closing entries on C12/31/XX rather than 12/31/XX.
NAV posts the closing entries on this “C” date so that you can utilize a setting that can be found
throughout NAV called “Include Closing Entries”. This feature allows you to be able to
include/exclude closing date postings when running reports and pages that display financial
data. So, for example, you could run an income statement as of 12/31 or C12/31 to get a
“before” and “after” snapshot of the data pre and post close.

5: Should I close by dimension?

Closing by dimensions allows you the ability to close your income statement accounts into
retained earnings more granularly (by dimension). Closing by dimension can result in a
dramatically larger closing journal, especially if your company utilizes many dimensions.
However, the upside of closing by dimension is that the posting will not only result in closing of
the income statement by G/L account balance, but it will also do the same for each G/L
Account/Dimension combination. For example, a company that closes by dimension can later
run an income statement for a single department (dimension) and show a zero dollar balance per
income statement account per the single department.

6: Why didn’t NAV close out all of my income statement accounts?

NAV will close out all G/L accounts that have an “Income/Balance” value of “Income
Statement”. Prior to starting the closing process, it is very important to check the entire chart to
make sure that all income statement accounts are marked as “Income Statement” and all balance
sheet accounts are marked as “Balance Sheet”. Failure to do so can result in income statement
accounts that NAV doesn’t close or worse yet, balance sheet accounts that get washed into
retained earnings.

7: NAV seemed to have double closed my income statement accounts.

Double closing of the income statement occurs when the “Close Income Statement” function is
run twice by accident. In such cases, the general journal’s closing entries are repeated a second
time in the closing journal. Failure to notice these duplicate entries (and remove them) will
result in a double set of closing entries being posted.

8: Why do my account schedules stop working when I run financial reports in the new fiscal
year?
NAV’s account schedules count on there being accounting periods setup in the “Accounting
Periods” page so that they can, for example, translate “period 1” = 01/01/15..01/31/15. So, as a
general rule, each year when running the “Close Accounting Periods” function, you should also
run the “Create Year” function as well (to create next year’s periods).

9: Will I be able to review the closing general journal prior to posting it?

In most cases, the answer is “yes.” Most of the accountants I work with like to review the
closing general journal batch prior to posting it. It’s a good idea to check the posting dates and
dimension values within the journal (see number 4 and 5 above). I’d also advise confirmation
that all of your income statements are accounted for within the batch (see number 6).

However, if your company happens to be maintaining an additional reporting currency, NAV

will go ahead and post the closing batch automatically and you won’t have a chance to review
the journal prior to posting. If you are unsure of whether or not your organization is using an
additional reporting currency, you can check the “General Ledger Setup” page which holds the
“Additional Reporting Currency” field. Depending on what version of NAV you are running, if
you are using an additional reporting currency, you may have to temporarily remove any
dimension value posting rules you have in place on your retained earnings G/L account until
after the closing posting is complete.
Since the “General Ledger Setup” page is unique per NAV company, keep in mind that your
organization may be tracking an additional reporting currency in some companies but not in
others. Thus you may see different results when closing across different companies.