taken from the
As in the case of a hand system, after processing all your
daily transactions for a specific year, you have to check the results and ensure
that certain actions have been performed before the Year-end procedure can be
performed. It is important to develop a checklist to meet your specific
requirements. This will ensure that you generate useful reports and that you
evaluate your business performance and financial position for a specific period
on correct information. The following represent a basic list and may vary
according to your circumstances.
These adjustments are normally done in the general journal and not in the specific journals (i.e. sales journal, purchase journal, cash receipts journal, cash payments journal, etc.), and the entries are posted to the ledger accounts. Normally the description entered on the journal and / or the applicable working papers are used as the source document.
Examples of some of the adjustments based on the accrual accounting basis, are provision for bad debts, prepaid expenses, accrued expenses, provision for accrued expenses, income received in advance, and accrued income. Most of these adjustments are short-term adjustments, where these expenses or income relate to the next successive accounting period or financial year.
However, some adjustments may relate to the long term, where the income or expenses are for more than one financial year. A good example is depreciation on fixed assets where the amounts are calculated over the life span of the assets and are apportioned for more than one year.
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All batches have been updated or posted to the Ledger
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All Documents have been updated or posted to the Ledger
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Depreciation transactions have
been entered and updated or posted to the Ledger
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Bad Debts have been have written off and updated or posted to the Ledger
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Payroll (Salaries and Wages) transactions have been entered and updated or posted to the Ledger
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Repeating transactions
and Repeating Invoices have been copied
to a normal batch and are updated or posted to the Ledger
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Adjustments and Corrections have
been entered and updated or posted to the Ledger
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Bank Reconciliation is finalised
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Interest on overdue debtors accounts have been entered and updated or posted to the Ledger.
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Generate any Multiple Entries (Fixed Amounts to Debtor Accounts, Debtors with Charge Amount, and
Creditors with Charge Amount, etc.)
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Generate Reports as
necessary, e.g. Trial Balance, Income Statements and Balance Sheets and any
other reports. You may need to analyse these reports and do the necessary
adjustments or corrections, if necessary.
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Generate Debtors Statements and Creditor Remittance Advises.
- Do the sufficient Backups of your Set of Books.
These adjustments are normally done in the general journal and not in the specific journals (i.e. sales journal, purchase journal, cash receipts journal, cash payments journal, etc.), and the entries are posted to the ledger accounts. Normally the description entered on the journal and / or the applicable working papers are used as the source document.
Examples of some of the adjustments based on the accrual accounting basis, are provision for bad debts, prepaid expenses, accrued expenses, provision for accrued expenses, income received in advance, and accrued income. Most of these adjustments are short-term adjustments, where these expenses or income relate to the next successive accounting period or financial year.
However, some adjustments may relate to the long term, where the income or expenses are for more than one financial year. A good example is depreciation on fixed assets where the amounts are calculated over the life span of the assets and are apportioned for more than one year.
