How to perform a ‘Year End’ process in Sage 50 Accounts

How to perform a ‘Year End’ process in Sage 50 Accounts

When it comes to the financial year end, all registered businesses must officially close their current year, generate final reports, and open a new financial year. Although the end of the financial year falls differently for each company, most businesses will follow the same process. If you are performing your Year End processes in  Sage 50cloud Accounts software we have listed the steps you’ll need to follow below.

What is a Financial Year End?

The term ‘Year End’ in accounting refers to the closure of a business’ financial year. The end of your financial year depends on when the company was founded and must cover at least 12 months of accounts (it can’t be any longer than 12 months)

A Year End processes consists of checking your data for accuracy and generating the right accounting reports. There are usually four main statements; The Statement of Financial Position (Balance Sheet), the Profit & Loss Statement (Income Statement), the Statement of Changes in Equity, and the Cash Flow Statement.

How do you prepare for a Financial Year End?

Before you run your Year End processes, you’ll need to ensure you’re working with accurate data.

Enter all transactions for the year

Before you begin your end of year process, you’ll need to ensure that all transactions for the financial year have posted. This includes;

  • Any adjustments from your accountant (normally posted as a journal)
  • Month end postings – including automatic depreciation, prepayments and accruals.
  • Opening and closing stock postings
  • All other outstanding transactions for the financial year

Chart of Accounts

The chart of accounts is used to allocate categories to each nominal code. This means that when you run your year end, the chart of accounts decides which nominal codes clear down and which balances are carried forward into your new financial year. To check your chart of accounts, follow the steps below.

  • Click ‘nominal codes’ and ‘chart of accounts’
  • Select the cart of accounts you want to view and choose ‘edit
  • Click ‘check’ to find any duplicated or missing nominal codes
  • If a message reading ‘No errors found in this chart of accounts’ appears, the chart is complete.
  • If you’re prompted to print a ‘Chart of Accounts Errors’ report then you have errors that need to be fixed.

Check and archive your data

Before you begin to process your Year End, we always recommend checking your data for any errors or corruption. It’s always good practice to get into the habit of archiving your data at regular intervals too. So, doing this at a time like the end of your financial year will help you get into the habit of data archiving.

How do you process a Year End in Sage 50cloud Accounts?

Once you’ve completed your data checks and archived your data, you’re ready to run your Year End processes. To do this, follow the steps below (taken from Sage)

  • Click ‘Tools’ – ‘Period End’ – ‘Year End’
  • Click ‘Check Data’ (correct any errors) and click close
  • Click onto ‘Check COA’ – click ‘Ok’ – click ‘Backup’- click ‘Ok’ then click ‘Ok
  • If you want to archive your data at this point, make sure the ‘Archive’ check box is selected
  • Confirm the details on the Archive Company window
  • To set up budgets for your new financial year, select the Budgets check box and choose your budget options.
  • Make sure that the date is the year you’re closing and if required, enter a Lock date
  • Click ‘Run Year End’ then click ‘Yes’ and click ‘Ok
  • Select how you want to output the report, click OK, then click Ok

That’s everything you need to do to run your financial Year End in Sage 50cloud and Sage 50 Accounts.

If you’d like to improve your skills using Sage software, we offer training courses that cover everything you need to know. You can view all of our training options below.

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