Learn step-by-step how to create a closing period in Microsoft Dynamics 365 Finance to ensure accurate fiscal year-end reporting.
Table of Contents
Question
Contoso, Ltd. is preparing to close their fiscal year. It needs to ensure that all financial transactions are correctly accounted for in the appropriate periods. The company has a custom fiscal calendar that starts on July 1st and ends on June 30th. You need to create a closing period that will allow Contoso, Ltd. to separate general ledger transactions generated during the fiscal year-end process, ensuring accurate financial statements. What should you do?
A. Adjust the dates of the last operating period to extend through the end of the fiscal year, allowing for additional closing entries.
B. Create a new fiscal year and designate the first period as the closing period for the previous fiscal year.
C. Manually post closing entries to the last operating period without creating a separate closing period.
D. Select the last period of the fiscal year with a status of Open and use the ‘Create closing period’ function to establish a new closing period with the same start and end dates.
Answer
D. Select the last period of the fiscal year with a status of Open and use the ‘Create closing period’ function to establish a new closing period with the same start and end dates.
Explanation
The correct answer is to select the last open period of the fiscal year and use the ‘Create closing period’ function to establish a new closing period with the same dates, which allows for proper separation of closing entries. Creating a new fiscal year or adjusting the dates of the last operating period does not address the need for a separate closing period. Manually posting entries without creating a separate closing period can lead to errors and does not follow best practices.
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