How to continue to work in ParishSOFT Ledgers & Payables without closing the period
Closing the accounting period in a timely manner adheres to Accounting Best Practices. We recommend closing the period between the 20th of the next month and the end of that month.
Benefits of closing a period:
- To ensure that transactions are not added or changed in error
- Fraud protection: transactions cannot be edited or added in closed months with the exception of journal entries if permissions allow.
- To ensure bank reconciliations are not altered:
- If you add a new transaction after a bank reconciliation is completed it can make the bank reconciliation out of balance
- To ensure printed reports from a prior period are not made obsolete with transactions later added or changed in error
- Allow report to be run using the preset date ranges. The preset date ranges go by the open period, not the calendar date. It is easier to select dates using the Current Month, Next Month, or Previous month options.
- Your finance council can have confidence in the reports they have for a closed period.
- Prevent the annoying (but helpful) message that the transaction is beyond the specified number of months
- Keeps you in line with Standard Accounting Practices (normally close a month before the end of the following month)
Drawbacks of not closing a period:
- Entries may be entered in prior calendar months that are still open.
- Changes to prior periods may not be easily found.
- If you need to run a report that uses the Fiscal Period Ended date range You will not be able to run reports if your fiscal year is not the prior or current year. Only reports that allow custom date ranges will allow you to go forward more than one year.
- Forms such as the 1099 and W-2s will not allow you to go forward more than one year.