This is one of the regular tasks in the production environment. The period end closing activities are defined as the regular periodical tasks to be executed at predetermined period intervals. In each application component or activity this period end closing activity is a routine process. The period end closing can be done by manual or by automatically through the help of Schedule Manager. I would like to give the gist of activities which can be considered a s period end closing activities.
Daily period end closing activities:
- Verification of cash balance;
- Ensure the daily postings are accounted for properly
- Payment of due bill of exchanges and follow up for due receivables and bill of exchanges.
- Verification of vouchers with the generated reports.
- Executing the automatic payment programme if it is the payment day.
Monthly period end closing activities:
- Open and close of posting period in the beginning of the month.
- Posting of Recurring entries at the defined period intervals.
- Accrual/deferral of postings at the predetermined as per the project.
- Depreciation in Asset accounting component (if it is monthly selection)
- Interest postings for GL accounts and open items.
- Auc settlement
- List of open items and list of bill of exchanges account statements for customers and vendors.
- Execution of automatic payment programme if required.
- Generating dunning notices for the vendor and customer balances if pre determined.
- Monthly evaluation of Business area reporting; if followed
- Foreign currency valuations
- Tax payments and reporting for the month
- Final reporting for generating financial statements.
- Internal reports for the management for strategic decision making.
MONTH END CLOSING ACTIVITIES:
- Month end preliminary reports
- Month end allocations, distribution of expenses for cost centers, through various methods if defined.
- Settlement of internal orders
- Locking of business transactions if required.
- Cost center profitability analysis and Allocations based on activity based costing.
- Monthly allocation of planning figures if planned like that.
- Follow-up postings to reconciliation ledger in controlling.
- Posting of periodic transfer of balances to Profit center accounting if followed.
Other Modules: in HR: pay rolls postings
In MM module: closing of material master and Maintain Gr/Ir clearing accounts.
In SD module: verification of Goods issue and Invoice issue postings are exactly generated in respect of all events for the month.
YEAR END CLOSING ACTIVITIES:
- Open and close of new fiscal year.
- If number range is year specific transport the new number ranges for the next year.
- Balance carries forward open items, assets as opening balances;
- Balance confirmations form vendors, customers, and bank balances,.
- Inventory valuations and defining new material cost estimates.
- Asset depreciation for the year. And valuations if required
- GR/IR account reconciliation.
- Regrouping of receivable and payables,
- Making provisions for doubtful receivables and payables.
- Verify the asset history sheets.
- Verify the Balance audit trail and
- Final adjustments for balance sheet.
- Final tax adjustments and CENVAT adjustments
- Misc settlements, allocations, apportionment’s, and so on.