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Running the year end close process in Dynamics GP

Here's a short primer on how to run the Dynamics GP year end close process.    Microsoft's longer, more official guidance can be found here:    http://support.microsoft.com/kb/850151.    But this document contains some key tips and advice.

1.    Make a backup of your Dynamics GP databases before running the process.

This is critical.   The year end close process dramatically changes the SQL Server database.    A lot of data is moved from one database table (the GL20000 table that contains the current year general ledger) to another database table (the GL30000 table that contains your historical year general ledger table).     Therefore, things can go wrong when you are making that many changes to the database.     If something goes wrong, it is not easy to fix so it may be necessary to revert to a database backup.

2.    Check your general ledger account setups.

The number #1 thing that goes wrong when you run the year end close process in Dynamics GP is the amount that is posted to your retained earnings account is incorrect because you have some general ledger accounts set up with the wrong "posting type".   When you set up a new general ledger account, you must specify a "posting type":    balance sheet or profit and loss.     The year end close process relies on this setting.     If you incorrectly set up an account as a balance sheet account, even though it should be an income statement account, the amount that is posted to retained earnings when you run the year end close will not be correct.

Please perform the following to double check your settings:   Go to SMARTLIST.   Go to Financial.   Then Accounts.    Run the * smartlist.   It will show you your chart of accounts.   Take a few minutes to scan this list to check for any accounts that appear to have the wrong posting type.

3.   Double check if you are setup to use multiple retained earnings accounts.

Do you have more than 1 retained earnings account?   Do you want to have the system automatically close to multiple retained earnings accounts?   If so, double check that you are setup to use the "close to divisional account segments" feature.    

Go to Tools > Setup > Financial > General ledger.   Is the "close to divisional account segments" box checked?   Have you pointed to the right segment in this screen that defines your "divisions"?

4.   If using the "close to divisional account segments" feature, do you have configured a retained earnings account for every division?   

When you attempt to run the close process, it will error out if it finds that you have a division (i.e. segment) setup but not a retained earnings account for that segment.

5.   Run the year end close processes for accounts receivable, inventory and accounts payable first.

6.   If you use the Project accounting module, you could run the optional year end close processes for project accounting.

See Microsoft's kbase for the optional year end close process for the project accounting module here:  http://support.microsoft.com/kb/875116

7.   Run the general ledger year end close process last.