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1987-02-23
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There are two "close the books" functions: Periodic Close, and Year End
Balances Forward. Both functions remind you of preliminary steps, but do not
insist that you actually do them -- be careful!
REMEMBER: So far as the IRS is concerned, your Audit Trail is ON PAPER, so
you should NOT run either of the close routines unless you have also printed
out your General Journal and Detail General Ledger, and put them away safe.
Periodic Close
--------------
Of the two, only Periodic Close is an actual "close". A periodic close
would normally be done at the end of every month. The only purpose of a
periodic close is to zero out your Revenue & Expense accounts, and post the
difference between them to your Retained Earnings account.
Notice that you can STILL get a detailed Statement of Account for any Revenue
or Expense account after a Periodic Close. Its balance will be zero, if you
have just run Periodic Close. Statement of Account is the printed version of
Query Accounts, on your Reports Menu.
After you do a Periodic Close for the first time, you will be able to get a
detailed Statement of Account for your Retained Earnings account (399), also.
Year End Balances Forward
-------------------------
The Year End Balances Forward function is only useful in two circumstances:
a) Setting up a new General Ledger's chart of accounts with beginning
balances. See Chart documentation.
b) Whenever you would like (or need) to recover disk space.
Year End Balances Forward SHOULD be run only after you have also run Periodic
Close, but that good rule is not strictly enforced. This function completely
REMOVES previous account detail, and writes a single Balance Forward entry for
each account into a NEW, BLANK LEDGER. You will be warned that this function
is unusual when you run it.