• From: Philippines, Calabarzon
  • Registered: 07/30/2020
  • Posts: 33

Topic: Close and delete fiscal years

I created a new company without any transactions or beginning balances. I noticed there are already three past fiscal years that are still active. Another new company, also without beginning balances or transactions also showed two past fiscal years that are also active. How can different fiscal years appear for a new company that is just set up? How can those past fiscal years without any transactions be closed and deleted?

I would appreciate any guidance and help in configuring fiscal years. Thank you.

Celito

  • Registered: 04/19/2020
  • Posts: 60

Re: Close and delete fiscal years

The fiscal years are generated from the script, make sure there is no sample data (transactions).
1st, create the current fiscal year, and go to Company Setup and set the current Fiscal Year.
Then you can close and delete empty fiscal years, click on edit icon and set "Is Closed" to "Yes" and click on Update button, and then delete the fiscal year.
If transactions exist, all transactions will be deleted and converted into relevant balances.

flpages's Website

  • From: Philippines, Calabarzon
  • Registered: 07/30/2020
  • Posts: 33

Re: Close and delete fiscal years

I am getting this message when I close the prior year fiscal year:

The Retained Earnings Account should be a Balance Account or the Profit and Loss Year Account should be an Expense Account (preferred the last one in the Expense Class)

I don't know what this is all about, when the company has just been set up and no prior year transactions.

4 Reply by flpages (edited by flpages 09/04/2020 01:09:02 pm)

  • Registered: 04/19/2020
  • Posts: 60

Re: Close and delete fiscal years

Retained earnings is under Balance sheet Liabilities & equity section.
Check the Retained earnings account in Banking and General Ledger>GL Account Groups, the account Class should be Liabilities.

Year Profit/Loss is under Income Statement/Profit and Loss Statement.
Check the Year Profit/Loss account in Banking and General Ledger>GL Accounts,  Account Group should be Expenses.

You'll need to correct the Retained earnings or Profit/Loss account settings before you can close the fiscal year.

and you have to check the GL accounts generated from system, modify it to suit your company needs.

flpages's Website

  • From: Philippines, Calabarzon
  • Registered: 07/30/2020
  • Posts: 33

Re: Close and delete fiscal years

I still don't get it. There are no balances in the fiscal years prior to the current fiscal year. What specific actions should be taken in those prior years when all balances are zero. There's nothing to close or carry forward to the next fiscal year.

6 Reply by flpages (edited by flpages 09/05/2020 08:31:25 am)

  • Registered: 04/19/2020
  • Posts: 60

Re: Close and delete fiscal years

Even there's no transaction, the system still check the GL Account settings before closing, and if not setup the GL Accounts properly, you'll not getting the correct P&L figures.

flpages's Website

  • From: Philippines, Calabarzon
  • Registered: 07/30/2020
  • Posts: 33

Re: Close and delete fiscal years

Just to confirm, the account class for Retained Earnings should be Liabilities? That is strange. It is an equity account.

  • Registered: 04/19/2020
  • Posts: 60

Re: Close and delete fiscal years

Retained earning is under liabilities in the Equity section of balance sheet.
It's ok to set it under Liabilities.
However you can set it to Equity by adding a new GL Account Class "Equity".

flpages's Website

  • From: Philippines, Calabarzon
  • Registered: 07/30/2020
  • Posts: 33

Re: Close and delete fiscal years

I hope you don't mind my ignorance.'

Is it correct to say that an account belongs to a group, and a group belongs to a class? Can we set this up based on what applies to the company, or does FrontAccounting have a required setup? What does it mean that it will "check GL account settings before closing?" What will it check against what? This is still not clear to me. A simple closing entry will debit all income accounts and credit all expense accounts. The difference goes to P & L, which is then transferred to Retained Earnings.

If we just delete all fiscal year tables, will this solve my problem, and can we set up a clean fiscal year?

Thank you so much for your patience.

Celito

  • Registered: 04/19/2020
  • Posts: 60

Re: Close and delete fiscal years

1. Assets, Liabilities and Equity are Balance Sheet Accounts.
2. Income and Expenses are P&L (Income Statement) Accounts.

Like what u said, The difference goes to P&L (2).
which is then transferred to Retained Earnings (1).

This is the standard and what the follow message checking for.
The Retained Earnings Account should be a Balance Account or the Profit and Loss Year Account should be an Expense Account (preferred the last one in the Expense Class)

You can delete the empty fiscal year in MySQL table x_fiscal_year.
But you still have to check the above settings.

flpages's Website

  • From: Philippines, Calabarzon
  • Registered: 07/30/2020
  • Posts: 33

Re: Close and delete fiscal years

Okay, thank you for the confirmation.