Period Closing Voucher
A Period Closing Voucher indicates that the profit/loss for an accounting period has been balanced and the books can start fresh.
At the conclusion of each year, quarter, or possibly even month, following the completion of auditing procedures, you have the option to finalize your books of accounts. This involves processing all your special entries such as:
- Depreciation
- Change in value of Assets
- Defer taxes and liabilities
- Update bad debts
Then book your Profit or Loss.
This action ensures that the balances in your Income and Expense Accounts are reset to zero. It marks the commencement of a new Fiscal Year (or period), characterized by a balanced Balance Sheet and a new Profit and Loss account. In BizCentric, after completing all the special entries through Journal Entry for the current fiscal year, you should reset all your Income and Expense accounts to zero using a Period Closing Voucher.
To access the Period Closing Voucher list, go to:
Home > Accounting > Opening and Closing > Period Closing Voucher
1. How to create a Period Closing Voucher
- Go to the Period Closing Voucher list and click on New.
- Set a posting date.
- Select the account, usually this is the ‘Reserves and Surplus’ account.
- Enter any remarks.
- Save and Submit.
1.2 The fields explained
- The Transaction Date will correspond to the creation date of the Period Closing Voucher.
- The Posting Date should be selected as the date when this entry is intended to be executed. For instance, if your Fiscal Year concludes on December 31st, that date should be chosen as the Posting Date in the Period Closing Voucher.
- The Closing Fiscal Year refers to the year for which you are finalizing your financial statement.
- The Book Cost Center Wise Profit/Loss function will record closing entries according to the cost center of income and expense accounting entries.
1.3 What happens on submitting?
Note: If accounting entries are made in a closing Fiscal Year, even after Period Closing Voucher was created for that Fiscal Year, you should create another Period Closing Voucher. Later voucher will only transfer the pending P&L balance into Closing Account Head.