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NetSuiteYear-End Close Manual 2018
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Contact FMT Consultants
FMT Consultants, LLC 2310 Camino Vida Roble
Carlsbad, CA 92011 www.fmtconsultants.com [email protected]
Marketing/Events [email protected]
(760) 930-6400
Sales(844) 369-4594
NetSuite Division Martin Jahn
Practice [email protected]
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Table of Contents Contact FMT Consultants ....................................................................................................................................................... 2
Year-End Closing Guide .......................................................................................................................................................... 4
1) Accounts Receivables Year-end Closing ............................................................................................................................ 4
1.1) Post all transactions for the closing period ............................................................................................................... 4
1.2) Reporting ..................................................................................................................................................................... 5
1.3) Customer Record Management .................................................................................................................................. 5
1.4) Aging Management ..................................................................................................................................................... 5
1.5) Period end close checklist for Accounts Receivable activity. .................................................................................... 5
2) Accounts Payables Year-End Closing ................................................................................................................................ 7
2.1) Post all transactions for closing period. ..................................................................................................................... 7
2.2) Reporting ..................................................................................................................................................................... 8
2.3) Vendor Record Management ...................................................................................................................................... 8
2.4) 1099 Reporting ............................................................................................................................................................ 9
2.4.1) Reconcile 1099 Amounts ...................................................................................................................................... 9
2.4.2) 1099 Saved Search.............................................................................................................................................. 10
2.5) Period end close checklist for Accounts Payable activity. ...................................................................................... 10
3) Fixed Asset Year-End Closing ........................................................................................................................................... 11
3.1) Post all transactions for closing period. ................................................................................................................... 11
3.2) Process Period-end Fixed Asset Report .................................................................................................................... 12
4) Lock All Period Close Task ............................................................................................................................................... 12
5) Resolve Transaction Date/Period Mismatches ............................................................................................................... 13
6) Inventory Year-End Closing .............................................................................................................................................. 14
6.1) Post All Transactions for the Period ......................................................................................................................... 14
6.2) Reconciling Inventory ............................................................................................................................................... 14
6.3) Inventory Counts and Adjustments .......................................................................................................................... 14
6.4) Inventory Reports ...................................................................................................................................................... 14
6.5) Inventory Record Management ................................................................................................................................ 15
6.6) Period end close checklist for inventory activity ..................................................................................................... 15
6.6.1) Review Negative Inventory ................................................................................................................................ 15
6.6.2) Review Inventory Cost Accounting .................................................................................................................... 15
6.6.3 Review Inventory Activity .................................................................................................................................... 16
7) General Ledger Year-End Closing .................................................................................................................................... 16
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7.1) Period end close checklist for G/L activity. .............................................................................................................. 16
7.1.1) Revalue Open Foreign Currency Balances ........................................................................................................ 17
7.1.2) Calculate Consolidated Exchange Rates ........................................................................................................... 18
7.1.3) Eliminate Intercompany Transactions .............................................................................................................. 18
7.1.4) G/L Audit Numbering .......................................................................................................................................... 19
7.1.5) Close.................................................................................................................................................................... 20
8) Accounting Period Management ..................................................................................................................................... 21
8.1) New Period Setup ...................................................................................................................................................... 21
8.2) Reopening close periods ........................................................................................................................................... 21
8.3) Quick Close Functionality: ........................................................................................................................................ 22
9) Period end close checklist ............................................................................................................................................... 22
10) FAQ .................................................................................................................................................................................. 29
Year-End Closing Guide The purpose of this document is to provide additional information for both the period close functionality in NetSuite and the accounting best practices related to year-end close tasks.
1) Accounts Receivables Year-end ClosingThis section includes tasks related to closing the Accounts Receivable module for a particular period. These tasks include posting all transactions for the closing period, processing Accounts Receivable related reports, customer record management, customer aging management and locking the Accounts Receivable module for the period.
1.1) Post all transactions for the closing period ▶ Prior to locking and closing the period, all transactions occurring within the period should be posted to
the applicable period. It is important to consider the concept of period cutoff to ensure that thetransactions are posted to the correct period.
▶ Review and post all Revenue Recognition journal entries that are applicable to this period. You cannotpost revenue recognition journal entries in closed periods or in periods that are locked for A/R.
▶ Transaction Date vs. Posting Period - For each Accounts Receivable transaction, a transaction date fieldand a posting period field are available. The transaction will post to the GL in the Posting Period. As such,it is important to correctly select the transaction date and the posting period as these fields will impactreporting results in NetSuite.
Note: If you have enabled any of the following new features please contact us as this document does not cover the changes in the close process associated with the newly released functionality available as part of the 2018.2 release.
• Period End Journal Entries
• In Transit Payments
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Accounting Preferences. After you check the “Enable Accounting Period Window” you will be able todetermine how NetSuite will handle posting of transactions outside of the current open period.
▶ To generate and send statements to customers at the end of an accounting period, the user will need tonavigate to the “Generate Statements” page. This is accessed by navigating to TransactionsCustomer Generate Statements. Lastly, the user is able to select various preferences for creating thestatements and select the method of transmittal (print, fax, or email). This task can be scheduled to occurautomatically at period ends.
1.2) Reporting ▶ To access the Accounts Receivable reports from the Administrator role:
o Navigate to reports “Customers/Receivables” to access the following reports: Accounts Receivable Aging (Summary and Detail) AR Register
1.3) Customer Record Management ▶ An important component of the year-end close process is customer record management, which entails
updating the information associated with each customer record. In order to perform edits to thecustomer record, a user’s role will require specific permissions (customer list edit or higher permission).
▶ Further, at period end, the customer records should be reviewed for recent activity. If the customer hasnot had any activity for the period, the customer record can be made inactive if desired. This is performedby editing the customer record, navigating to the system information subtab, checking the inactivecheckbox, and saving the record. This is usually done for customers that have not been active with a fullfiscal year or more so no audit reports are affected. Saved searches and reports may need to be flaggedto include inactive customers.
1.4) Aging Management ▶ Consider performing maintenance on the accounts receivable records that may be uncollectible as of the
close process. This performed as a two-part process that includes creating of a journal entry to record thewrite off and then applying that journal entry to the accounts receivable transaction.
1.5) Period end close checklist for Accounts Receivable activity ▶ After completing the Accounts Receivable tasks discussed above, the next step is to update the period
close checklist for Accounts Receivable related items.▶ To perform the update to the period close checklist, navigate as Administrator to Setup Accounting
Manage Accounting Periods.
▶ NetSuite can be configured to limit the extent to which transactions can be posted in open and futureperiods. To access the settings controlling this functionality, navigate to Setup Accounting
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▶ The Manage Accounting Periods screen will appear (below). This provides a listing of close tasks to becompleted in the order listed. From this screen you can see if a period is open or closed and what
accounting areas are locked for each period. Click on the icon to progress forward.
▶ From the image above, you can see that for the period of January 2017, we are currently able to lock A/R,A/P, and All as signified by the green arrows under the “go to task”. Additionally, please take note of the“Status” column below on the right-hand side for which there are multiple statuses including not started
, partially complete , and completed .
Lock A/R (single subsidiary):
▶ Click on the green arrow next to Lock A/R. Click on the “Lock” button. After you click the lock button thestatus column will have a green check mark.
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Lock A/R (OneWorld):
▶ In a NetSuite OneWorld environment, we are able to perform the Lock AR task for each subsidiary as seenin the image below.
2) Accounts Payables Year-End ClosingTasks to close the Accounts Payable module for a particular period include posting all transactions for the closing period, processing the Accounts Payable related reports, vendor record management, and locking the Accounts Payable module for the period.
2.1) Post all transactions for closing period. ▶ Prior to locking and closing the period, all transactions occurring within the period should be posted to
the applicable period. It is important to consider the concept of period cutoff to ensure that thetransactions are posted to the correct period.
▶ Transaction Date vs. Posting Period - For each Accounts Payable transaction, a transaction date field anda posting period field are available. The transaction will post to the GL in the Posting Period. As such, it isimportant to correctly select the transaction date and the posting period as these fields will impactreporting results in NetSuite.
▶ Run all applicable amortization schedules for the period. These must be run and the journal entriesposted prior to closing the AP module for the period.
▶ NetSuite can be configured to limit the extent in which transactions can be posted in open, includingfuture, periods. To access the settings controlling this functionality, navigate to Setup Accounting Accounting Preferences. After you check the “Enable Accounting Period Window”, you will be able toconfigure how NetSuite should handle posting of transactions outside of the current open period.
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▶ While posting the transactions relevant to the period being closed, it is important for the AccountingDepartment to consider the accruals that have been created or should be created. There are twomethods to generate accruals in NetSuite:
o Automation in NetSuite – NetSuite can be configured to perform and post accruals upongeneration of item receipts. The reversal/variance transaction can be performed upon theposting of the vendor bill by using the native NetSuite functionality (some configuration will berequired). To review this functionality and configuration requirements in more detail, pleasereview the “Match Bill to Receipt” functionality in NetSuite Help.
o Manual Creation – This method requires no configuration in NetSuite. The user can enter ajournal entry to manually capture the substance of the accrual. Further, the accrualreversal/variance would be manually calculated and performed.
2.2) Reporting ▶ To access the Accounts Payable reports from the Administrator role:
o Navigate to reports and then select: Vendor/Payables to access the following reports:
• Accounts Payable Aging (Summary and Detail)• AP Register
Sales Tax US to access the following reports:• Sales Tax Liability by Tax Agency• Sales Tax Liability by Tax Item (i.e. locality)• Sales Tax on Sales• Sales Tax Analysis
VAT/GST (if applicable) to view the applicable reports. Purchases to access the following reports:
• Purchases by Vendor – this report could be used at year end to negotiate volumediscounts with suppliers/vendors for the upcoming periods.
2.3) Vendor Record Management ▶ An important component of the year-end close is vendor record management, which entails updating the
information associated with each vendor record. In order to perform edits to the vendor record, theuser’s role will require specific permission (vendor list edit or higher permission).
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▶ Further, at period end, the vendor records should be reviewed for recent activity. If the vendor has nothad any activity for the period, the vendor record can be made inactive if desired. This is performed byediting the vendor record, navigating to the system information subtab, checking the inactive checkbox,and saving the record. This is usually done for vendors that have not been active with a full fiscal year ormore so no audit reports are affected. Saved searches and reports may need to be flagged to includeinactive vendors.
2.4) 1099 Reporting 2.4.1) Reconcile 1099 Amounts ▶ A 1099 reconciliation process should be performed after all the applicable accounts payable transactions
and cash receipts have been posted in the correct period. This will ensure accuracy of the information reported to the applicable vendors and the Internal Revenue Service.
▶ The 1099 reporting process should be performed prior to the IRS deadline. By using activities and tasks functionality in NetSuite, users can set a reminder to prompt the end user to reconcile and submit the1099’s. To create these tasks, the user will navigate to Activities SchedulingTask New. After the task has been created, they will need to setup as a reminder. To setup this task for a reminder, the user will navigate to the home screen, locate the reminders portlet, hover over the reminders portlet menu areand select “Set Up” (image below).
Then click on or drag over the Current Selections List to add the following reminders: o Tasks due todayo Tasks that are overdueo Tasks to complete
2.4.2) 1099 Saved Search ▶ NetSuite requires some initial configuration in order to utilize the 1099 functionality. The vendor record
must have the 1099 Eligible field marked and the EIN tax ID must be populated. Additionally, the 1099 configured chart of accounts must be setup and used in the appropriate transactions, as the dollar amounts will flow through on checks, but will not flow through for journal entries.
▶ NetSuite provides customized saved searches to help you export 1099–MISC vendor payments to a third-party provider, such as Yearli by Greatland, Sovos, and Track1099. You can edit the saved search for your particular needs. For example, if you want to include payments made by checks in the savedsearch, you might need to replace the Date Closed field with the Date field.
Important: You are responsible for the information that you report to the Internal Revenue Service (IRS). The saved search provided by NetSuite might not include all of the information that you need to report. Review the output of the saved search for accuracy before you export the data to a provider.
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▶ To use the 1099 saved searches to report vendor payments:• Go to Customization > SuiteBundler > Search & Install Bundles (Administrator)• In the Keywords field, enter 1099 Vendor Payment Report.• Click the name of the bundle for your third-party provider, and then click Install.• Click Install Bundle.• After the saved search is installed, go to Reports > Saved Searches > 1099 Vendor Payment
Report – Yearli > Edit.• Edit the search according to your needs.• Export the search to a CSV or Excel file.• Open the file, and then do the following:
o Find and remove any instances of the word – None –.o Remove the last row in the file that starts with the word Total.
2.5) Period end close checklist for Accounts Payable activity. ▶ After completion of the Accounts Payable tasks discussed above, the next step is to update the period
close checklist for Accounts Payable related items.▶ To perform the update to the period close checklist, navigate as Administrator to Setup Accounting
Manage Accounting Periods.▶ The Manage Accounting Periods screen will appear (below). This provides a listing of close tasks to be
completed in the order listed. From this screen you can see if the period is open or closed and what
accounting areas are locked for each period. Click on the icon to progress forward.
Lock A/P (Single Subsidiary):
▶ Click on the green arrow next to Lock A/P.
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▶ Click on the “Lock” button. After you click the lock button, the status column will have a green checkmark.
Lock A/P (OneWorld):
▶ In a NetSuite OneWorld environment, we are able to perform the Lock AP task for each subsidiary as seenin the image below.
3) Fixed Asset Year-End Closing▶ If applicable, the Fixed Asset module maintenance tasks should be incorporated into your company’s
period close processes. This includes posting all the transactions in the applicable period, processingdepreciation, and processing the fixed asset reports.
3.1) Post all transactions for closing period. ▶ The following transactions should be posted to the correct period:
o Additionso Depreciation
Both GAAP basis depreciation and tax basis depreciation (if applicable) should beperformed at year end.
o Transferso Disposals (Write off and sale type)o Revaluation
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▶ The above transactions are separate from any accounts receivable and accounts payable transactionspreviously addressed, as these transactions should all take place in the fixed asset module. To performthis, navigate to Fixed Assets Transactions and select the various transactions.
3.2) Process Period-end Fixed Asset Report ▶ To access the fixed asset reports, navigate to Fixed Assets Reports and view the various reports.
o Reports will need to be generatedo To access the fixed asset saved searches navigate to Fixed Assets Saved Searches to view the
various saved searches.o A recommended saved search is the “Fixed Asset Register Saved Search” as a roll forward report.
As this is a saved search, the criteria can be adjusted as deemed fit for roll forward reporting.
4) Lock All Period Close Task▶ After the A/R and the A/P tasks have been completed, NetSuite requires completion of the “Lock All” task
to proceed forward with closing the period. This is essentially another layer of locking down the A/R, A/P,and Payroll modules (not discussed in document).
▶ Click on the green arrow next to Lock All.
Click on the “Lock” button. After you click the lock button, the status column will have a green check mark.
Lock All (OneWorld):
▶ In a NetSuite OneWorld environment, we are able to perform the Lock All task for each subsidiary as seenin the image below.
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5) Resolve Transaction Date/Period Mismatches▶ After the AR, AP, and ALL tasks have been locked, you will be able to progress forward to the subsequent
close tasks, the first one being “Resolve Date/Period Mismatch”.
▶ This step identifies transactions where the date on the transaction does not align with the posting periodassociated with the transaction. For example - the date of a cash sale is 5/1/2017, but the posting periodis March 2017 (Mar 2017). With this mismatch, users may encounter differences in reporting amountsbased on if the reports are based on date or posting period.
▶ To prevent this from occurring in the future, set the “Allow Transaction Date Outside of Posting Period”field in accounting preferences to “disallow” or “warn”. With this, when transactions is entered with adate and period mismatch, the user will either receive a warning message or be prevented from saving thetransaction.
▶ Click on the green arrow next to Resolve Date/Period Mismatches. Click on the “Resolve Date/PeriodMismatches” button. If applicable, this will provide a list of transactions where the date of the transactiondoes not align with the posting period of the transaction. The user will be able to review and correct thesetransactions, if necessary.
▶ After completing the review of the transactions with any potential date/period mismatches, click the
button. Next, click the button to complete the task.
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6) Inventory Year-End ClosingTasks to close inventory for a particular period include posting all transactions for the period, reconciling inventory, performing inventory counts and posting necessary adjustments, processing inventory reports, inventory record management, and performing the period end close checklist for inventory activity.
6.1) Post All Transactions for the Period ▶ Prior to locking and closing the period, all transactions occurring within the period should be posted to
the applicable period. It is important to consider the concept of period cutoff to ensure that transactionsare posted to the correct period. These transactions include sale orders, item fulfillments, invoices,purchase orders, item receipts, and vendor bills.
▶ Transaction Date vs. Posting Period - For each inventory related transaction, a transaction date field and aposting period field are available. The transaction will post to the GL in the Posting Period. As such, it isimportant to correctly select the transaction date and the posting period as these fields will impactreporting results in NetSuite.
▶ NetSuite can be configured to limit the extent to which transactions can be posted in open, includingfuture, periods. To access the settings controlling this functionality, navigate to Setup Accounting Accounting preferences. After you check the “Enable Accounting Period Window” you will be able toconfigure how NetSuite should handle posting of transactions outside of the current open period.
6.2) Reconciling Inventory ▶ Following the completion of the preliminary close tasks discussed above, the next steps involve inventory
review and reconciliations.
▶ This reconciliation process will involve performing a physical inventory count and comparing thosefigures to the inventory quantities in NetSuite.
6.3) Inventory Counts and Adjustments ▶ To perform a physical inventory count, navigate to Transactions Inventory Enter Inventory Count.
The inventory count team will have the ability to perform inventory variance postings directly in thecount. If necessary, the inventory counts can also be edited following entry.
6.4) Inventory Reports ▶ To access reports related to inventory, navigate to Reports Inventory/Items. The following reports are
particularly important for period end close:o Inventory Valuation
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o Physical Inventory Worksheeto Trial Balance or Balance Sheet
6.5) Inventory Record Management ▶ An important component of the year-end close is item record management, which entails updating
information contained in the item records. In order to perform edits to the item record, a user’s role willrequire specific permissions.
▶ At period end, item records should be reviewed for recent activity. If an item has not had any activity forthe period, the item record can be made inactive if desired. This is performed by editing the item record,navigating to the system information subtab, checking the inactive checkbox, and saving the record.
▶ A final note on inventory management – Prior to making any items inactive, the user should considerwhether the items are a component of a kit, group, or assembly.
6.6) Period end close checklist for inventory activity ▶ Now that inventory has been reviewed, the next step is to update the period close checklist for inventory
related items.
6.6.1) Review Negative Inventory ▶ Prior to performing the review of negative inventory checklist task, the organization should perform an
inventory count at the end of the period being closed. Once the count is completed, the user will be ableto review negative inventory values and if necessary, adjust accordingly to align with the inventory count.
▶ To perform this checklist task, click the green arrow next to the review negative inventory task. Next, clickon the “Review Negative Inventory” button. If applicable, this will provide a listing of inventory items witha negative inventory value for the period. The user will review and correct where necessary. Theinventory count steps performed prior to this stage should limit the adjustments required in this task. Theresults can be filtered for a specific location within the environment.
▶ After reviewing these items, click on the Back to Period Close button to mark the task complete (both ofthese steps mirror resolve date/period mismatch process above).
6.6.2) Review Inventory Cost Accounting ▶ After the Review Negative Inventory task has been locked, you will be able to progress forward to the
subsequent close task - “Review Inventory Cost Accounting”.
▶ This task is necessary to ensure maintenance of correct inventory cost accounting when transactions(purchasing, sales, or adjustments) have been inserted or removed from an existing series of transactions.
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▶ Click the green arrow next to the Review Inventory Cost Accounting task. Next, click the Review InventoryCost Accounting button.
▶ On this screen, the user can review the transactions in the period and ensure that there are no costingitems to be corrected and that the automated system inventory costing calculations have been fullyprocessed.
▶ To run inventory costing calculations, there must be no items on the Review Inventory Cost Accounting page in the
list of outstanding items to be corrected. If any items show on the list, you must wait until they are resolved.
6.6.3 Review Inventory Activity ▶ This task is only applicable to OneWorld accounts. It is used to review inventory values for each
subsidiary.▶ Navigate to the checklist task and click “Review Inventory Activities”.
▶ Next, you will see the inventory activity detail report. Review for each subsidiary using the filter at thebottom of the page and customize as desired with the customize button at the bottom of the page.
▶ Next, click the back button on your browser and mark the task complete.
7) General Ledger Year-End Closing7.1) Period end close checklist for G/L activity.
▶ Revalue Open Foreign Currency Balances▶ Calculate Consolidated Exchange Rates▶ Eliminate Intercompany Transactions▶ GL Audit Numbering▶ Close Period
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7.1.1) Revalue Open Foreign Currency Balances ▶ This task allows users to revalue any open transactions in foreign currencies to the base/functional
currency of the company as of period end. This will drive posting of unrealized gain/loss for foreign currency revaluation. The unrealized gain or loss will impact accounts receivable, accounts payable, and any bank accounts in a foreign currency other than that of the entities functional currency.
▶ Foreign Currency revaluation is an important concept to ensure that financial statements are provide an accurate depiction of the company’s financial position. This task must be performed at period end, but can additionally be performed at any point in time by navigating to Transactions Financial Revalue Open Currency Balances.
▶ This task requires access to a role with the Currency permission and the Override Period Restrictions permission.
▶ Click the green arrow next to the Revalue Open Foreign Currency Balances task. Next, click the Currency Revaluation button at the top of the page to begin revaluing the transactions with open balances as of period end.
▶ The Month End Currency Revaluation screen will appear (below). At the top of the month end currency revaluation screen, the user will be able to select the foreign currency requiring revaluation to the base currency. On the left-hand side of the Month End Currency Revaluation screen, the user will be able to select specific accounts to be revalued. Once the fields have been populated as desired, click save to generate the revaluations. The user can view various reports for details on the unrealized gain or loss on exchange by navigating to Reports -> Financial -> Unrealized exchange rate gain/loss.
• Lastly, mark the task complete using the mark task complete button.
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7.1.2) Calculate Consolidated Exchange Rates ▶ It is important to note that consolidated exchange rates differ from transaction exchange rates.
▶ Consolidated exchange rates are used for consolidated reporting for subsidiaries with different
functional/base currencies, where the child subsidiaries will be reporting in consolidation with the parent subsidiary. This involves translation of child subsidiary financial statements (using the consolidated exchange rates) into the reporting parent’s functional/base currency:
o Current = Asset (except fixed assets) and Liability Accounts o Historical = Equity account and Fixed Assets o Average = Income Statement Accounts
▶ This checklist task is used to confirm the period close consolidated exchange rates used in the
consolidation process. • Click the green arrow next to the Calculate Consolidated Exchange Rates task and click the calculate
exchange rates button.
• The consolidated exchange rates table will appear allowing users to use the auto calculate feature
(button) or manually enter various exchange rates (if the inline edit feature is enabled). Click Back to Period Close and mark task complete to complete the task.
7.1.3) Eliminate Intercompany Transactions ▶ This feature can be performed in OneWorld multi-subsidiary environments. This feature will
automatically generate the necessary elimination journal entries in the elimination subsidiary – this is a great feature as other ERP systems may require these entries to be performed manually. A common scenario where this is performed is in the intercompany sales order and purchase order process, where the related revenue, cost of goods sold, accounts receivable, and accounts payable balances will need to be eliminated.
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▶ In order to perform the elimination, the desired accounts must be marked to perform the “Eliminate Intercompany Transactions” on the GL account record setup screen.
▶ To begin the elimination process, click the green arrow next to “Eliminate Intercompany Transactions”.
▶ Next, click the “Run Intercompany Eliminations” button.
▶ Next, the user can perform the intercompany eliminations based on various segment combinations (Class, Department, Location). Click save.
▶ Next, review the elimination journal entries performed in the listing of the task screen.
▶ Lastly, after all journal entries created have been reviewed, click the Mark Task Complete button.
7.1.4) G/L Audit Numbering ▶ The GL audit numbering function applies a gapless numbering sequence to all G/L posting transactions.
▶ To use this feature, it must be enabled under Setup -> Company -> Enable Features -> Accounting.
▶ Next, under Accounting Preferences, the organization will need to determine the frequency in which the
GL audit numbering is applied. This is determined in the GL audit numbering method field and the options are base period, quarterly, or annually.
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▶ To perform this process, click on the green arrow next to the GL Audit Numbering task.
▶ Next, click the GL Audit Numbering button.
▶ Next, the user can enter the following details related to the GL numbering sequenceo Name - enter a name for the sequence.
o If you use NetSuite OneWorld, select the subsidiaries whose transactions you want to include in thesequence.
o Prefix and suffix – enter the prefix and suffix you want to apply to the transaction numbers for thissequence.
o Minimum Digits - the minimum number of digits permitted for each number.
o Initial Number - enter the first number to assign in this sequence.
o Order By - choose how you want to order the transactions for numbering. Options are transactiondate or transaction creation date.
▶ Click save and then mark the task complete.
7.1.5) Close ▶ After all the preceding close tasks have been completed, the user will be able to close the period.
▶ Click on the green arrow next to the close task.
▶ Click on the Close Period button.
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8) Accounting Period Management8.1) New Period Setup ▶ Additional periods can be set up at Setup Accounting Manage Accounting Periods.
▶ Click the and you will be directed to the “Accounting Periods for Full Year” page.
▶ Enter the fields to align with your business requirements. The “One-Day Year-End Adj. Period” checkbox isa particularly important field. By marking this field, there will be a standalone adjustment period for thelast day of the fiscal year where all adjustments for year-end can be performed.
8.2) Reopening closed periods ▶ Accounting periods can be reopened as needed.▶ Please note that NetSuite functionality can be configured to allow creation of non-G/L changes in a closed
period without reopening the period. This requires the following:1) The Role has the permission (Setup Sublist) for “Allow Non G/L Changes”.2) The accounting period must be configured to allow non G/L changes.
a. On the Manage Accounting Periods page, click the “Period Name” text in the periodname column.
b. In the popup window that appears, check the “Allow Non G/L Changes” checkbox.
▶ If a period that has been closed requires G/L changes at a later date, the period must be reopened beforethese changes can be completed.
The ability to reopen closed periods requires “Override Period Restrictions” permissions.
The navigation path to reopen an accounting period is Setup -> Accounting -> ManageAccounting Periods.
Click the Checklist icon ( ) for the period. On the Period Close Checklist page, click the green arrow icon for the Close task row. On the Close Accounting Period page, click Reopen Period. Enter text in the Justification field to explain why you are reopening the period, click
Reopen Period again, and review the warning text to make sure you understand that ifyou reopen the period, you may need to redo checklist tasks to close the period. Note -any subsequent closed periods are automatically reopened and you may need to redochecklist tasks for those periods as well before you can close them.
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8.3) Quick Close Functionality: ▶ A new feature available for the month-end close process is the “Quick Close” function. This function
allows the user to close multiple periods with the click of a button. Prerequisites include:o The user must have the “Period Closing Management” permission.o The Allow Quick Close of Account Periods preference must be enabled in accounting
preferences.
▶ Quick Close is performed by navigating to Setup -> Accounting -> Manage Accounting Periods and clicking“Close Multiple Periods”
▶ Once that button is clicked, the following screen appears and the user can close a single or multipleperiods by simply clicking the Submit button.
9) Period end close checklistThis section serves to provide an overview of the steps to close a period in NetSuite and does not provide any accounting best practices as discussed above.
In order to close a period in NetSuite, the system must first be locked for AP, AR, and All. Once those tasks on the period close checklist are locked, it is a best practice for those areas to be reconciled and adjusted, if necessary.
To lock those areas, first navigate to Setup AccountingManage Accounting Periods. The Manage Accounting Periods screen will appear (below). This provides a listing of close task to be completed in the order listed. From this screen you can see if the period is open or closed and what accounting areas are locked for each period. Click on the
icon to progress forward.
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From the image above you can see that for the period of January 2017, we are able to lock A/R, A/P, and All as signified by the green arrows under the “Go To Task”. Additionally, please take note of the “Status” column below on
the right-hand side for which there are multiple statuses including not started , Partially complete , and
completed .
Lock A/R:
▶ Click on the green arrow next to Lock A/R. Click on the “Lock” button. After you click the lock button thestatus column will have a green check mark.
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Lock A/P:
▶ Click on the green arrow next to Lock A/P. Click on the “Lock” button. After you click the lock button thestatus column will have a green check mark.
Lock All:
▶ Click on the green arrow next to Lock A/P. Click on the “Lock” button. After you click the lock button, thestatus column will have a green check mark.
Resolve Transaction Date/Period Mismatches:
▶ After the AR, AP, and ALL tasks have been locked, you will be able to progress forward to the subsequentclose task, the first one being Resolve Date/Period Mismatch.
▶ Click on the green arrow next to Resolve Date/Period Mismatch. Click on the “Resolve Date/PeriodMismatches” button. If applicable, this will provide a list of transactions where the date of the transactiondoes not align with the posting period of the transaction.
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After completing the review of the transactions with any potential date/period mismatches, click the
button. Next click the button to complete the task.
Review Negative Inventory:
▶ After the Resolve Date/Period Mismatch task has been locked, you will be able to progress forward to thesubsequent close tasks, such as the Review Negative Inventory task.
▶ Click the green arrow next to the Review Negative inventory task. Next, click on the Review NegativeInventory button. If applicable, this will provide a listing of inventory items with a negative inventoryvalue for the period.
▶ After the review, click on the Back to Period Close button to mark the task complete (both of these stepsmirror resolve date/period mismatch process above).
Review Inventory Cost Accounting:
▶ After the Review Negative Inventory task has been locked, you will be able to progress forward to thesubsequent close task, the next being the Review Inventory Cost Accounting task.
▶ Click the green arrow next to the Review Inventory Cost Accounting task. Next click the Review InventoryCost Accounting button.
▶ This will bring you to the screen where the user can review the transactions in the period and ensure thatthere are no costing items to be corrected and that inventory costing calculations are not alreadycurrently running.
▶ To run inventory costing calculations, there must be no items on the Review Inventory Cost Accountingpage in the list of outstanding items to be corrected. If any items show on the list, you must wait until theyare resolved.
Revalue Open Foreign Currency Balances:
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▶ This task allows users to revalue open transactions in foreign currencies to the base currency as of period end. This will initiate posting of unrealized gain/loss for foreign currency revaluation.
▶ Foreign Currency revaluation is an important concept to ensure that financial statements are provide an accurate depiction of the company’s financial position. This task must be performed at period end, but can additionally be performed at any point in time by navigating to Transactions Financial Revalue Open Currency Balances.
▶ This task requires access to a role with the Currency permission and the Override Period Restrictions permission.
▶ After the Review Inventory Cost Accounting task has been locked you will be able to progress forward to the subsequent close task, the next being the Revalue Open Foreign Currency Balances.
▶ Click the green arrow next to Revalue Open Foreign Currency Balances task. Next click the Currency Revaluation button to begin revaluing the transactions with open balances as of period end.
▶ The Month End Currency Revaluation screen will appear (below). At the top of the month end currency revaluation screen, the user will be able to select the foreign currency(s) requiring revaluation to the base currency. On the left-hand side of the Month End Currency Revaluation screen, the user will be able to select specific accounts to be revalued. When the fields have been populated as desired, click Save to generate the revaluations.
▶ Example: A USD base currency company enters a vendor bill in Euros on the 1st of the month. The exchange rate at that point in time was .8554. During the accounting period close on the 31st, the open vendor bill will need to be to be revalued for the exchange rate on the 31st. In this example, on the 31st the Euro to US dollar exchange rate is .9554. Upon booking the foreign currency revaluation, the transaction will have an unrealized loss on revaluation.
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▶ Lastly mark the task complete using the Mark Task Complete button.
Calculate Consolidated Exchange Rates
▶ This checklist task is used to confirm the period close consolidated exchange rates used in theconsolidation process.
▶ Click the green arrow next to view the calculate consolidated exchange rates task and click the calculateexchange rates button.
▶ Next you will see the consolidated exchange rates table and be able to use the auto calculate feature(button) or manually enter various exchange rates (if the inline edit feature is enabled). Click Back toPeriod close and Mark Task Complete to complete the task.
Eliminate Intercompany Transactions
▶ To begin the elimination process, click the green arrow next to “Eliminate Intercompany Transactions”.
▶ Next, click the “Run Intercompany Eliminations” button.
▶ Next, the user can perform the intercompany eliminations based on various segment combinations(Class, Department, Location). Click save.
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▶ Next, review the elimination journal entries created in the listing of the task screen.▶ Lastly, after all journal entries created have been reviewed, click the Mark Task Complete button.
G/L Audit Numbering
▶ To perform this process, click on the green arrow next to the GL Audit Numbering task.▶ Next, click the GL Audit Numbering button.
▶ Next the user can enter the following details related to the GL numbering sequence:o Name - enter a name for the sequence.
o If you use NetSuite OneWorld, select the subsidiaries whose transactions you want to include in thesequence.
o Prefix and suffix – enter the prefix and suffix you want to apply to the transaction numbers for thissequence.
o Minimum Digits - the minimum number of digits permitted for each number.
o Initial Number - enter the first number to assign in this sequence.
o Order By - choose how you want to order the transactions for numbering. Options are transactiondate or transaction creation date.
▶ Click save and then mark the task complete.
Close:
▶ After all the preceding close task have been completed the user will be able to close the period.▶ Click on the green arrow next to the close task.▶ Click on the close period button
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10) FAQ▶ If I need to reopen a closed period that has multiple closed periods before it, do I have to reopen each
period?o Answer: No, you can simply unlock the period you want to adjust and then close each period.o For example, you are in January 2016 and need to reopen September2015. If you reopen September
2015, then December, November, and October will be reopened as well.
▶ Do all transaction edits require the periods to be reopened?o Answer: No. In NetSuite there is a setting that allows the user to determine if they would like to
allow non-G/L impacting changes to be allowed in a closed period. This setting is in each specificperiod on the period close checklist.
▶ Can FMT help with NetSuite month-end and year-end training for my accounting team?o Answer: Yes.
▶ Accrual Creation and Reversal Questions:o How does the posting of variances work within NetSuite?o Answer: This is dependent upon the item type being used in the transaction. From the highest
level, in order to post variances the user will have to navigate to Transactions Payables PostSupplier Bill Variances. Contact FMT to discuss additional configuration required to optimize thisprocess.
