Running a year end involves many processes including producing and reconciling your reports and posting adjustments to your accounts.This article contains the following sections:

• What happens when you run the Year End option – When you run the Year End option, Sage Accounts checks all of your data and, where relevant, amends the information in readiness for your new financial year.
  
• To prepare to run the Year End option – Mandatory Procedures – Before running the Year End option there are certain mandatory and optional procedures to consider. This section explains the mandatory procedures.
  
• To prepare to run the Year End option – Optional Procedures
  - Before running the Year End option there are certain mandatory and optional procedures to consider. This section explains the optional procedures.
  
• To run the Year End option – Once you have completed the pre year end mandatory and optional procedures, and have posted all of the transactions possible for the year, you are ready to run the Year End option.
  
• To prepare for the new financial year – Mandatory Procedures – After running the Year End option there are certain procedures that should be carried out. They are split into mandatory and optional procedures. This section explains the mandatory procedures.
  
• To prepare for the new financial year – Optional Procedures – Before you start to process data for your new financial year, there are a number of optional procedures that you may want to complete.
  

What happens when you run the Year End option

Profit and loss balances are cleared

When the Year End option is run, Sage Accounts checks all of the Chart of Accounts to establish which nominal codes are profit and loss codes. The balances, up to the end of the current financial year, on these profit and loss nominal codes are transferred to the Profit and Loss Account nominal code. This is 3200 by default and is in the Capital and Reserves section of the Chart of Accounts.

Any balances remaining on profit and loss nominal codes relate to transactions posted for the new financial year. The balance on the Profit and Loss Account nominal code is adjusted by the profit or loss from the financial year you have just closed.

Note: The Profit and Loss Account nominal code is a control account. This means that the year end postings are automatically sent to this account. To check the Control Accounts, open the Settings menu, then choose Control Accounts. In the Control Accounts settings, the Profit and Loss Control Account is called Retained Earnings

Balance sheet balances are brought forward to the new financial year

The balance sheet nominal code balances are carried forward into the new financial year. These balances are transferred to the brought forward boxes on the Nominal Records, and are included in the Year To Date values on the Balance Sheet report when calculated for a date in the new financial year.

Audit trail updated

The journals posted to clear the balances from the profit and loss nominal codes are added to the audit trail. The Year End option creates a report that lists these journals and can be printed or output to file to be printed later.

Nominal Records updated

On the Nominal Record Details tab, the value of any future dated transactions is transferred from the future bucket to the relevant month on the Actual column. The Actual monthly balances for the financial year that you are closing are transferred to the Prior Year columns on the Nominal Record. This enables you to print comparison reports in the new financial year. If you select, in the Year End window, to Transfer / Copy Actuals to Budgets, the Actual monthly balances are also transferred as the Budget values for your profit and loss nominal codes for the new financial year. If specified, a percentage increase is applied. This is an optional feature of the year end.

Product Records

Sage 50 Accounts, Sage Instant Accounts Plus v8.2 and above – The Actual Sales Value and Actual Quantity Sold values in each Product Record are transferred to the Prior Year columns. Any future dated transactions are transferred to the relevant monthly field in each Product Record.

Customer and Supplier Records

The values in the YTD (Year To Date) turnover box in all Customer and Supplier Records are transferred to the Prior YTD field. Any future dated transactions are transferred to the relevant monthly field in each Customer / Supplier Record.

Financial Year Start Date

To prepare to run the Year End option- Mandatory Procedures

Run Check Data

The Year End option calculates balances based on your transactions and the information held in your software records. It is therefore essential that your data is error free. Before running the Year End option, you should use the Check Data option to check the validity of your data files and, if necessary, correct any data corruption.

Note: If you have a multi-user licence, this is an exclusive program request area. This means that you must log all other users out before you can access this option.

Check your Chart of Accounts

During the Year End procedure Sage Accounts uses all layouts in the Chart of Accounts to establish which are the profit and loss nominal codes. The balances from the profit and loss nominal codes are then transferred to the Profit and Loss nominal code which is by default 3200.

To ensure that all profit and loss codes are represented it is important to check your Chart of Accounts, otherwise their balance is not cleared at the year end. and correct errors in your Chart of Accounts.

Take two backups

Before running the Year End option, you should take two backups of your data and keep these in a safe place. Once the year end is run, the only way to go back to a pre year end position is to restore from one of these backups. You may need to do this to run reports, check accounts, or even run the Year End option again. We advise taking two backups as a precaution against loss or damage to your pre year end backup. For further information about backing up your data, please refer to Ask Sage – Detailed Article 11592 How to back up and restore your data files.

To prepare to run the Year End option – Optional Procedures

Run the Month End

If you usually run the Month End option, before running the Year End option, you should run the month 12 month end.

Change Program Date

The Year End option posts journals to clear the balances on your profit and loss nominal codes. These journals must be dated on the last day of your financial year. Sage Accounts stores this date and automatically enters it in the Year End window. You can run either the Year End option with your program date set to the current date, or change the program date to be the last day of the financial year.

• If you run the Year End option with the program date set to a date beyond the year end, the following message appears:
  

‘The current program date is outside your financial year. If you continue it may cause discrepancies in your accounts. Do you want to continue?’

To run the Year End option, click Yes, or to exit without running the Year End option, click No.

This message is a warning against running certain year end routines to the wrong date, for example running the clear audit trail into the new year or running the month end for month 12 with the wrong date.

• If you run the Year End option with the program date set to be the last day of the financial year the following message appears:
  

  ‘You are about to process a Year End whilst in your current financial year.
  Are you sure you wish to continue?’
  

  To run the Year End option, click Yes, or to exit without running the Year End option, click No.

  This message is aimed at preventing you from running your Year End before you are ready.

Print Reports – If required, print the following reports:

• Trial Balance
  
• Profit and Loss
  
• Balance Sheet
  
• Aged analysis reports for debtors and creditors
  
• Statements for customers and banks
  
• Bank Report, un-reconciled
  
• Day Books for customers, suppliers, banks and nominal
  
• Activity reports on all ledgers
  
• Audit trail
  
• Budget Analysis report
  
• Prior Year Analysis report
  
• Sage 50 Accounts Plus/Sage Line 50 Accountant Plus and Sage 50 Accounts Professional/Financial Controller – Stock Valuation
  
• Sage 50 Accounts Plus/Sage Line 50 Accountant Plus and Sage 50 Accounts Professional/Financial Controller – Product Profit Reports
  

Note: If you are unsure which reports to print, please check with your Accountant.

To run the Year End option

1. Open the Tools menu, choose Period End then choose Year End.
   

   The Year End window appears.
   

2. Complete the Year End window as follows:
   

• Year End Date – Displays the last day in the current financial year.
  
• Current Date – Displays the current program date.
  
• Transfer Actuals to Budgets / Copy Current Actuals – To automatically set budgets based on income and expenditure during the year for profit and loss nominal codes, select this option. These values are transferred as monthly figures.
  
• Percentage Increase – If you want to set a target for the following year, enter the percentage increase you want to apply to your budgets here.
  
• Year End Journals – Automatically displays the year end date. This is the date Sage Accounts uses to post the journals which clear your profit and loss nominal codes.Note: This date must be within the year you are about to complete, otherwise there will be discrepancies on your Profit and Loss report in the new financial year.

• Output to – Displays the output options for the Year End report. This report details the journals automatically posted at the year end. You can choose one of the following:
  

Print – Select this option to output the report direct to your printer.
File – Select this option to file the report to print later.

Tip: If you need to rrun this report again, you can run the Day Book: Nominal Ledger report as this report only picks up journals. Simply enter the appropriate transaction number range.

• Sage Line 50 v9.xx and above, including Sage 50 Accounts – Archive Company Data before Year End – This option allows you to take a copy of your data at the pre year end point. You can then refer back to the archived data, either to run reports or analyse your previous year’s data.
  

  Note: Archived data is read only and cannot be amended in any way.
  

1. To run the Year End option, click OK.
   

   Tip: If required, to cancel the routine, click Cancel.
   

   When the year-end postings have been made, the software desktop appears.
   

To prepare for the new financial year – Mandatory Procedures

To check the financial year start date

1. Open the Settings menu then choose Financial Year.
   

If the financial year start date is a year in advance, you have either run the Year End option twice, or have used the incorrect financial year start date during the previous year. To check this, you must restore from a backup taken before you ran the Year End option and check the financial year start date.

To check that the profit and loss nominal codes have cleared correctly

To produce a Trial Balance report for the brought forward period and ensure that there are no profit and loss nominal codes included, please refer to the steps below.

• Open the Company module, from the Links pane click Financials then click Trial.
  

  For Sage Accounts v11.xx and below – Open the Financials module then click Trial.
  

  The Trial Balance window appears.
  

• Complete the Criteria as follows:
  
  • In the Print Output window, select Printer
    
  • From the Period drop-down list, choose Brought Forward.
    

• To print the report, click OK, then complete the Print window as required.
  
  A trial balance prints displaying any nominal codes with a brought forward balance.

  To prepare for the new financial year – Optional Procedures
  

  Clearing Stock
  

  Sage 50 Accounts and Sage Instant Accounts Plus v8.2 and above, and Sage Line 50 Accountant Plus and Financial Controller v8.1 and below, allows you to clear stock transactions from your product activity up to a specified date. The In Stock quantity is unaffected by this procedure. All transactions up to the date specified are removed except the following transaction types which remain if there is a quantity unused:
  

  AI	Adjustment In
  MI	Movement In
  GI	Goods In

  Note: Clearing stock transactions affects any transactional product reports.
  

  Clear the audit trail
  

  Clearing the audit trail removes fully paid and fully reconciled transactions from your audit trail up to a specified date. This means that you have fewer transactions to work with, making tasks, for example, printing reports and taking a backup quicker. Fully paid and reconciled transactions appear on the audit trail with Y in the paid column and either – (not applicable) or R (reconciled) in the Bank and VAT columns. Transactions that do not meet this criteria are not removed from the audit trail.
  

  When transactions are removed, Sage Accounts posts opening balance journals to the nominal codes which have been cleared to ensure that the balances on these accounts are the same before and after clearing the audit trail. The date used for these journals is the date up to which you selected to clear.
  

  Note: Removing transactions may affect transactional reports and statements that are run either for the period prior to the clear audit trail date, or for the current period and include a balance brought forward from the previous period.
  

  Remove Customer, Supplier, Nominal or Bank Records
  

  After running the Year End option and clearing the audit trail, you may want to remove old, or unused, accounts from your Customers, Suppliers, Nominal or Bank Account modules. To be able to remove an account there must not be any transactions on the activity, including deleted transactions
  

  Remove unwanted invoices, sales orders or purchase orders
  

  After running the Year End option you may want to delete old invoices, or in the case of Sage 50 Accounts Professional, sales orders or purchase orders. After deletion, if the data is compressed you will regain disk space taken by this old data saving you time backing up and running reports.
  

  Compress the data files
  

  If you have deleted records from within Sage Accounts, the relevant data file is not reduced in size until the Compress option is run on the selected data file. For example, if you delete one record from your Customers list, the size of the Sales.dta file which stores the Customer Records is not reduced until the Sales Ledger file is compressed.
  

  You have successfully completed the Year End procedure in Sage Accounts.
  

  by: Vanashree Pillay
  

  This document was prepared by Vanashree Pillay from Sage pastel South Africa. This document has been reproduced as it is with their permission. www.pastel.com
  

   

 

 

Tags: Sage Line 50, Sage Line 50 KB