# Business Central Year-End Close Checklist > Source: https://netray.co/tools/business-central-year-end-close-checklist > Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems. > Section: Free Tools ## Short answer Work through preparation, subledger, inventory, closing and post-close steps for a clean Business Central fiscal year end. ## Category microsoft-dynamics ## Erp Microsoft Dynamics 365 Business Central ## Audience - Controller - Finance manager - BC administrator ## Tool **Kind:** checklist **Groups:** #### Before you start **Items:** **Text:** Take a database backup or confirm a recent environment copy exists **Critical:** true **Text:** Confirm the next fiscal year and its accounting periods are created **Critical:** true Set the allowed posting date range in General Ledger Setup and User Setup Agree the close calendar and owners with finance and operations Check that there are no open batch jobs or job queue entries posting in the background Document any manual adjustments planned for the close #### Subledgers and transactions **Items:** **Text:** Post or delete all open sales and purchase documents dated in the old year **Critical:** true Post unposted general journal batches and recurring journals **Text:** Reconcile accounts receivable to the customer ledger and the control account **Critical:** true **Text:** Reconcile accounts payable to the vendor ledger and the control account **Critical:** true Run bank account reconciliations and clear outstanding items Post depreciation for fixed assets for the final period Review prepayments, accruals and deferrals for the year Run foreign currency Adjust Exchange Rates for open ledger entries #### Inventory and manufacturing **Items:** **Text:** Finish or review all production orders that should close in the year **Critical:** true **Text:** Run Adjust Cost - Item Entries for all items **Critical:** true **Text:** Run Post Inventory Cost to G/L and reconcile inventory to the G/L accounts **Critical:** true Perform and post the physical inventory count and revaluation if required Review negative inventory and items with unapplied entries Check WIP accounts and capacity ledger values against the G/L Verify intercompany and consignment stock balances #### Closing the year **Items:** **Text:** Run Close Income Statement batch job and review the preview **Critical:** true Check that the retained earnings account and the closing dimensions are set as intended Post the closing entries and verify the income statement accounts net to zero **Text:** Run the trial balance for the year and compare to the pre-close version **Critical:** true **Text:** Close the fiscal year in Accounting Periods once all checks pass **Critical:** true Post any audit adjustments to the proper period using allowed posting ranges Run VAT or sales tax settlement and reconcile to the return #### After the close **Items:** **Text:** Lock prior period posting dates for normal users **Critical:** true Archive reports: trial balance, aged receivables and payables, inventory valuation Set up budgets and number series for the new year if needed Review and clean up user permissions and job queue entries Write down issues for next year and update this checklist Run a final backup after the close is signed off **Scoring Note:** Items marked critical should be complete before you close the fiscal year, because closing prevents posting into the year without changing posting ranges. Steps and page names may differ by version and localisation, so confirm with your partner and local statutory requirements. ## Content **Intro:** Closing a fiscal year in Business Central is mostly about sequence: post what is unposted, reconcile subledgers, adjust inventory cost, then run the closing batch job and close the year. This checklist groups the work into five phases and marks the steps you should not skip. **Sections:** #### How to use the checklist **Body:** Tick items as they are completed, keep it open during the close meeting and assign an owner per group. Critical items are highlighted because a mistake there is hard to undo after the year is closed. Export the finished list to PDF or Excel as evidence for your auditors and as the starting point for next year. #### The core sequence **Body:** First finish operational posting: documents, journals, depreciation and exchange rate adjustments. Then reconcile accounts receivable, accounts payable, bank and inventory to the general ledger. For manufacturers, run Adjust Cost - Item Entries and Post Inventory Cost to G/L before looking at the final numbers. Only then run the Close Income Statement batch job, which transfers income statement balances to retained earnings, and close the year in Accounting Periods. **Bullets:** - Subledgers reconciled before closing - Inventory costs adjusted and posted to G/L - Closing entries reviewed in preview - Fiscal year closed last #### Handling late adjustments **Body:** Auditors often propose adjustments after the close. Business Central allows posting into a closed year only if the posting date range permits it, so adjust the allowed posting dates for a named user, post the entries, then restore the range. Run the closing batch again only if needed and keep a clear record of the changes. Do not reopen periods casually, because comparatives and reports then change. #### Common mistakes **Body:** Closing the income statement before inventory cost adjustment, which shifts profit after the books are closed. Leaving documents unposted in the old year, forgetting the next year accounting periods, and running the batch job without checking the preview and the dimension settings are the typical issues. **Cta:** If your close takes too long because of reconciliations, Netray can help automate reconciliation checks over your Business Central data. **Faq:** #### What does Close Income Statement do in Business Central? **Answer:** It creates closing entries that move income statement account balances to the retained earnings account for the fiscal year, so the new year starts with zero balances on those accounts. #### Can I post to a closed year? **Answer:** Yes, if the posting date falls within the allowed posting range in General Ledger Setup or User Setup. Widen the range for a specific user, post, then restore the range. #### Why run Adjust Cost before closing? **Answer:** Costs of inventory and cost of goods sold change as costs are adjusted. Running the adjustment first makes sure the closing figures include the final values. #### Do I need to close each accounting period too? **Answer:** Closing the fiscal year closes its accounting periods. Many companies restrict posting dates monthly using the allowed posting range even if periods stay open during the year. ## Search terms business central year end close, business central close income statement, business central close accounting period, business central year end checklist, business central adjust cost item entries year end, business central fiscal year close, business central closing process finance --- Talk to an engineer: https://netray.co/contact?intent=erp_ai | Machine catalog: https://netray.co/agent/catalog.json