Year End Activities

Hello everyone! In today’s session, we’ll learn about year end activities related to the finance domain. Now we have learned about month end activities in our previous session. In month end activities, it consists of finalizing financial accounting postings, then settlements of CWIPs and internal orders, then we have to update the  exchange rates, display document journals at month end, then we have to close all the settled process orders, month end period, and finance posting periods. So, these were the activities, which were carried out during month end process.

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Now, in year end activities, we need to take care of how to carry forward the vendor and customer balance to the next financial year as opening balance, then we have to take care of carrying forwarding the asset balance, carry forward the general ledger balance. Then we have to copy no range intervals for the next financial year. Then open the posting period for the next year, like to open the special periods. So, these are some of the activities which needs to be carried out during the year end.

Let us see the course content for this particular session, which was the year end activities. So under year end activities, we need to do some activities, like Fiscal Year Change based on asset accounting, Capital Work in Process Closing, then Customer Vendor Balance Carry forward and lastly, we’ll see Year-End Close general ledger activities. So these are the cost content for this year end activities. Now here, year end closing has to take into consideration the activities, like fiscal year change for financial accounting and asset accounting. Then year end closing will be done for asset accounting, accounts receivable, accounts payable, and general ledger. So these are some activities which are to be performed under year end activities. 

Fiscal Year Change: Financial Accounting

What is fiscal year change financial accounting? Now here to open up periods to allow postings in the following year, the procedure is similar to that of described in the slides for open and close periods needs to be added to. Now here, please note that this step will only allow postings to the new financial year, the closing of the previous year’s profit and loss balances to the retained earnings account, and the transfer of balance sheet values to the new fiscal year only occurs by performing a fiscal year close. So here, fiscal year change related to financial accounting relates to new financial year, that is, it has profit and loss balances to be retained for each earning account. Fiscal year change, they have to transfer the balance sheet values to the new fiscal year then they have to take a to consideration the open and close periods for the new fiscal year. So this is the financial accounting activities related to fiscal year change. Now after this, we’ll see financial year activities that is related to asset accounting. Now initially, we have seen about financial accounting. For asset accounting, we need to use a transaction code AJRW. 

So here, as with the GL account postings, to allow postings to the new fiscal year for asset accounting transaction, we need to change the fiscal year. So one thing you should note that this step will not carry forward asset balances from the old to the new year. So to change the fiscal year in asset accounting, we’ll go to the transaction code AJRW, or we can use a menu path that is accounting, financial accounting, then fixed assets, then periodic processing. Under that, we’ll click on fiscal year change. So this is the screen for the asset fiscal year change. 

1. Now here, we’ll have to mention the company code, the new fiscal year, and we’ll have to click that checkbox text to run if it is a test run-in any of the systems. And if it is done in the production system, then we have to remove this test run checkbox. So this is the fiscal year change for asset accounting. Now here, if this is done in the production mode, then we’ll have to use the menu path like program, and then we’ll have to go to executing background. Now once we click on that, we’ll get a screen where we have to perform some steps based on the execution in background. Now, since we are doing in test run mode, that is the test mode, we’ll get the output as shown in this screen.

Now, this is the output. Here we’ll get the fiscal year change statistics. So here it will give the details of the company code. Then the data which is read from the already changed data and changed to data, if there are any incorrect values, it will print the number of the incorrect values. Then all the other details, like without values, are already deactivated. So this is the statistics for the fiscal year change, which we get for asset accounting.

Next something called as year end closing of asset accounting. Now this is required to transfer the depreciation expense to accumulated depreciation and recalculate book values for assets in the balance sheet.

Now we use the year end closing program to close the fiscal year for one or more company goals from an accounting perspective. Once the fiscal year is closed, we can no longer post or change values within the asset accounting. The fiscal year that is closed is always the year follow the last closed fiscal year. We cannot close the current fiscal year. So, like, if we have closed the fiscal year 2013, then we cannot post any values under that period and we cannot close the current fiscal year, that is the current year is 2014. So this is the example of year end closing for asset accounting.