MICROSOFT DYNAMICS GP

YEAR-END CLOSING PROCEDURES

MICROSOFT DYNAMICS GP USERS GROUP MEETING

December 2012

Contents TIPS FOR A SUCCESSFUL YEAR-END ........................................................................ 4

INVENTORY ................................................................................................................... 6

What the Inventory Year-End Close Process Does ...................................................... 6

Summary Steps ........................................................................................................... 6

Detailed Steps ............................................................................................................. 6

ABC Analysis ............................................................................................................. 14

Inventory Year-End Closing Tips ............................................................................... 21

Inventory Year-End Q & A ......................................................................................... 21

ACCOUNTS RECEIVABLE ........................................................................................... 23

Closing a Year ........................................................................................................... 23

Receivables Management CALENDAR Year-End Closing Overview ......................... 23

Detailed Receivables Management CALENDAR Year-End Closing Checklist ........... 24

Receivables Management FISCAL Year-End Closing Overview ................................ 25

Detailed Receivables Management FISCAL Year-End Closing Checklist .................. 25

Receivables Management Year-End Closing Tips ..................................................... 26

ACCOUNTS PAYABLE ................................................................................................. 29

Changes in the Year-End Update that Affect Payables .............................................. 29

Calendar-Year Closing Procedures ........................................................................... 29

Using Checklists to Perform Year-End Procedures .................................................... 29

Printing 1099 Statements........................................................................................... 30

Closing a Calendar Year ............................................................................................ 31

Closing a Fiscal Year ................................................................................................. 32

Option ........................................................................................................................ 33

FIXED ASSETS ............................................................................................................ 34

Changes in the Year-End Update .............................................................................. 34

Year-End Processing ................................................................................................. 34

Fixed Assets Year-End Closing Steps ....................................................................... 34

MULTICURRENCY ....................................................................................................... 36

Closing a Year ........................................................................................................... 36

Multicurrency Management Receivables – Period-End .............................................. 36

Multicurrency Management – Year-End ..................................................................... 38

GENERAL LEDGER ..................................................................................................... 39

Closing a Year in General Ledger .............................................................................. 39

Year-End Closing Procedures.................................................................................... 39

Year-End Closing Procedures (Summary) ................................................................. 40

General Ledger Year-End Closing Tips ..................................................................... 45

General Ledger Year-End Questions & Answers ....................................................... 47

PAYROLL ..................................................................................................................... 51

Period- & Year-End Procedures ................................................................................. 51

Period-End Procedures (Monthly, Period End or Quarterly) ....................................... 52

Quarter-End Procedures ............................................................................................ 55

Payroll Year-End Procedures .................................................................................... 56

Closing a Year........................................................................................................ 56

Updates Included in the Year-End Update ............................................................. 57

Editing W-2 Information Procedures .......................................................................... 60

Printing W-2 Statement Procedures ........................................................................... 62

Electronic Filing Not Provided by GP ......................................................................... 64

Editing 1099-R Information Procedures ..................................................................... 65

Printing 1099-R Statements Procedures .................................................................... 67

Processing 2013 Pay Runs Before Printing 2012 Year-End Statements Checklist .... 69

Employee Self Service Update for W4 ....................................................................... 70

APPENDIX .................................................................................................................... 71

Common Questions Support May Ask when Troubleshooting an Issue ..................... 71

Dynamics GP Application Information ........................................................................ 71

Hardware/System Information ................................................................................... 72

Questions Support Engineer May Ask to Resolve the Issue ...................................... 72

BKD Support Center...................................................................................................... 74

Online Support ........................................................................................................... 74

Contact Us ................................................................................................................. 74

Training & Meetings ................................................................................................... 74

Connect With BKD ........................................................................................................ 75

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TIPS FOR A SUCCESSFUL YEAR-END

Year-end is a very hectic time for you, as well as for us. We want to make sure that you get the best support possible during this time. So, we have listed the following tips to help you prepare for year-end. While we strive to have complete and accurate information, your best referral

sources for year-end issues will be CustomerSource located at http://www.microsoft.com/en-us/dynamics/default.aspx and the Microsoft Support Blog at http://blogs.msdn.com/b/dynamicsgp/default.aspx?wa=wsignin1.0. The items listed in the Appendix are just a sample of what is located on the CustomerSource web site. CustomerSource is available to you if you are enrolled in an enhancement plan. Please check CustomerSource for up-to-the-minute information for your year-end closing. Pay special attention to Knowledge Base and Support Hot Topics.

Also, review CustomerSource for your payroll tax update status. These updates are

only available on the internet. DO NOT WAIT UNTIL THE LAST MINUTE!!! After your update is loaded, verify that the tax tables are updated. You can do this by comparing the tax schedules in the system (Setup >> System >> Payroll Tax) to those listed in the IRS publication (Circular E). Please make sure to use the Annual table for the comparison to the FED tax code. You will also need to verify the FICA tax cutoff for the Social Security portion in the FICAS tax code. This extra step will provide assurance that the update affected the files correctly and that employee checks will have the proper amounts withheld for taxes. Please note that no tax or form updates for 9.x or below are available from Microsoft.

Screenshots and directions in this manual are based on Dynamics GP version 2010.

Although the windows will be different if you are using an earlier version, most procedures will be the same. (Let us know if you need earlier version procedures.)

STEPS FOR YOUR PLANNING STAGE

SELECT AN OPTIMAL TIME to do the year-end closing. Plan for adequate time before the next critical task needs to be performed.

DEVELOP A WORK PLAN – a detailed and step by step work plan for your

year-end closing will help to ensure that no vital steps of the closing are left out. DEVELOP A CONTINGENCY PLAN!! There can be instance where things

might not proceed as planned. Please have a contingency plan established if such a situation should arise. This contingency plan MUST include having a complete backup of Dynamics GP and data that can be easily restored if it is necessary to get up and running again.

STEPS TO COMPLETE BEFORE YEAR-END

Back up all existing data and code. Be sure this backup can be restored if necessary.

Perform Check Links procedures on all tables. This will ensure that data is at the highest integrity before you perform the year-end closing.

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Make a second backup after the year-end close. If you need to restore from a

backup, you will have a backup after the year-end close that can be restored. If you do not make this backup, you would be forced to restore a backup from before your year-end closing and then redo the year-end closing again.

Please note that the following modules do not have a year-end closing routine:

Sales Order Processing Purchase Order Processing Bank Reconciliation Multicurrency Human Resources Project Accounting

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INVENTORY

Before you close the Inventory Control module for the year, there are several preliminary tasks to complete. Use the procedures described in this section to close the year and prepare your Inventory records for the new fiscal year.

What the Inventory Year-End Close Process Does

Transfers all of your summarized current-year quantities, costs, and sales amounts to last year. The item must be flagged for tracking history.

Updates each item’s Beginning Quantity, from the Quantity on Hand, for each site

Zeros the Quantity Sold for each item/site combination

Optionally (at your discretion) performs the following updates

o Remove discontinued items

o Remove sold purchase receipts

o Remove sold lot attributes

o Update items’ standard cost if using FIFO Periodic or LIFO Periodic

Closing a year transfers all summarized current-year Quantity, Cost and Sales amounts to transaction history for the Items with summarized Sales History. This closing procedure also updates each Item's Beginning Quantity to the Quantity on Hand at each Site.

Summary Steps 1. Post all transactions for the year. 2. Reconcile Inventory Quantities. 3. Complete a Physical Inventory count and post any adjustments. 4. Print additional reports. 5. Make a backup. 6. Close the year. 7. Close the fiscal periods for the Inventory series (optional). 8. Make a final backup.

Detailed Steps

1. (Required) Enter and post all 2012 transactions for Sales Order Processing, Invoicing, Purchase Order Processing, Inventory Control, Manufacturing, and Bill of Materials.

You must complete this step to ensure that historical information is accurate and that year-to-date amounts are updated correctly.

You can enter transactions for a new year before closing the previous year by entering them in separate batches; however, you should not post these batches until you have closed the year.

2. Reconcile Inventory Quantities.

a) Reconcile Sales Order Processing and Purchase Order Processing, in that order, if you are using one or more of those modules.

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b) Reconcile Quantities for all Inventory Items using the Reconcile Inventory Quantities window (Utilities >> Inventory >> Reconcile) to ensure that your Inventory Control data has not become damaged over the course of the year.

c) Enter or select the range of item numbers to reconcile.

d) Include Item History (Optional).

e) Process – the reconcile report automatically is printed.

If any discrepancies are found during the Reconcile process, the Quantities will be adjusted. If adjustments are made, they will be reflected on the Reconcile Report, along with any Serial Numbers and Lot Numbers that were added for the adjusted Items. If you want to edit these Serial and Lot Numbers, you can use the Item Transaction Entry window (Transactions >> Inventory >> Transaction Entry) to do so by making adjustment transactions.

3. Complete a Physical Inventory count and post any adjustments.

a) Use the Stock Calendar Maintenance window (Setup >> Inventory >> Stock Calendar) to set up and maintain information about when stock counts can be performed and which days will be “counted” when the system calculates suggested dates for the next stock count for a specific item-site combination.

b) The Stock Count Cycle Assignment window (Cards >> Inventory >> Count Cycle Assign.) can be used if desired to assign one stock count frequency to many items.

c) Create a Stock Count Schedule (Transactions >> Inventory >> Stock Count Schedule) — a list of the specific items at a specific site that will be counted during a specific count. When you start a stock count schedule, the quantity on hand for each line in the stock count schedule is captured. Later, the actual count number quantities will be compared to the captured values to

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create default variance transactions. Stock Count Forms can be printed during this process.

1. Enter or select a stock count ID.

2. Enter a description and select a default site ID. (The default site ID can be left blank for all locations.)

3. To create a reusable stock schedule, mark the Reuse option.

4. Decide how items listed in the stock count schedule should be sorted. (To add many items to a stock count schedule – choose Mass ADD to open the Stock County Mass Add window.)

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Select the first and last item from inventory to add inventory to the Stock Count Mass Add.

5. Select Start Count

6. The Stock Count Print Options window appears.

Determine how to sort the report.

Be sure to select “Print item lot or serial numbers” if you are tracking lot or serial numbers.

Select print options for the Stock Count Forms.

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d) Use the Stock Count Entry (Transactions >> Inventory >> Stock Count Entry) window to enter information about the results of your stock counts. When you process a stock count, variance transactions are created. If the Autopost Stock Count Variances option is marked, the transactions also will be posted.

To enter stock count results:

1. Open the Stock Count Entry window. (Transactions >> Inventory >> Stock Count Entry)

2. Enter or select a stock count ID with Started or Entered status. The combinations included in the stock count are displayed in the scrolling window.

If you enter or select a stock count ID that was started when the multiple bins feature was not enabled and the feature is enabled now, an alert message is displayed. The stock count will be updated to include bin information. You must use the Stock Count Entry window to add bin information for each line in the stock count. If you have entered stock count results for the stock count ID, those results will be cleared.

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3. Accept or change the default document date.

The default document date appears in each line of the scrolling window as you enter count results. The user date is the default document date, but you can change it.

4. Accept or change the default count date.

The user date also will be the default stock count date in each line of the scrolling window. Refer to Changing the default stock count date for more information about changing stock count dates.

5. Select the sorting order for the scrolling window.

6. Enter the counted quantity for each item in the item’s base unit of measure.

To enter count results in other units of measure, refer to Entering results in a different unit of measure.

7. When you move off the field, Inventory Control automatically calculates the variance quantity, updates the date and time with the default count date and time and marks the verified option. (If no default count date and time is available, the user date and time are used.) You can accept or change the default date and time. You also can clear the Verified option if you want to check the entries before transactions are created.

8. If the item is tracked by lot or serial numbers, you must enter information about the lot or serial numbers of the items that were counted.

To enter lot number information, refer to Entering stock count lot number information.

To enter serial number information, refer to Entering stock count serial number information.

9. Continue, repeating steps 6 through 8 for each combination.

10. Once you have entered a counted quantity for an item in the scrolling window, the options for Autopost Stock Count Variances and Reuse

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Stock Count are available. You can mark or unmark those options as needed.

The default setting for the Autopost Stock Count Variances option comes from the Inventory Control Setup window. The default setting for the Reuse Stock Count option comes from the Stock Count Schedule window.

11. View distribution accounts for each combination in the scrolling window, and make changes, if needed. Refer to Changing accounts for posting a count variance.

12. View unposted transactions and transaction history to see if there is an accounting reason for a variance.

For example, suppose the count for Item A was 34 and the captured quantity for the item was 40. The default variance will be 6. If you check unposted transactions and find an unposted transaction for 6 units of item A, you probably will not want to process the default variance transaction because the difference between the count quantity and the captured quantity can be attributed to other entries in the system. Refer to Verifying variance amounts.

You should view unposted transactions and transaction history for any stock count result that has a variance.

13. Save or process the stock count information.

If you choose Process, inventory variance transactions will be created. Refer to Effects of processing a stock count for more information.

If you choose Save, no transactions will be posted now, and you will be able to enter more stock count results for this stock count schedule later.

14. When you have finished, close the window.

If you did not choose the Autopost Stock Count Variances option, you can review and edit the inventory adjustment created by the count. However, you must use the Inventory Batch Entry window to post the transactions.

To process a stock count:

1. Open the Stock Count Entry window. (Transactions >> Inventory >> Stock Count Entry)

2. Enter or select a stock count ID.

3. Choose Process.

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5. Instead of going through the Stock Count procedure listed above, you could manually create your adjusting entries. Print a Physical Inventory Checklist using the Inventory Activity Reports window (Inventory Area >> Reports >> Activity) and perform a physical count of your Inventory Items to verify that Quantity on Hand amounts are accurate for all Items. If discrepancies exist, enter the necessary adjustments in the Item Transaction Entry window (Inventory Area >> Transactions >> Transaction Entry) and post them.

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ABC Analysis

ABC analysis is a method of prioritizing items based on parameters that you specify. ABC analysis is based on the Pareto principle, a broad generalization that recognizes “predictable imbalance”—that, for example, 80 percent of the value of your inventory might come from 20 percent of the items. With ABC analysis, you can identify which items are most critical to your business, which are somewhat critical and which are least important. Then you can manage those items accordingly.

Inventory Control includes a wizard you can use to complete ABC analysis of Sales Inventory and Discontinued items.

Before beginning an ABC analysis, be sure that no one is performing any of these activities:

Using any Inventory Control utility, such as a price list wizard or removing history records

Completing year-end closing procedures

Starting a separate ABC analysis

To perform an ABC analysis of inventoried items:

1. Open the ABC analysis wizard, and then choose Next. (Tools >> Routines >> Inventory >> Item ABC Analysis)

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2. In the ABC Analysis Options window, select the type of information you want the analysis to be based on. Choose Next.

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Analysis option Usage option Calculation used

Unit cost Not applicable

If valuation method is Average Perpetual or Perpetual (LIFO or FIFO), then current cost is used. If valuation method is Periodic (LIFO or FIFO), then standard cost is used.

On-hand inventory value Not applicable

Unit cost x On-hand inventory quantity

Usage quantity Historical usage

Annual usage quantity is calculated from the last completed month or period plus all previous months or periods for the previous one year of sales and dependent usage (except current); or, all available information if a full year of information isn’t available. If no usage exists, the default value is zero.

Projected usage

Projected usage quantity is calculated from the current month or period plus all future months or periods for one year of projected usage (including current); or, all available information if a full year of projections isn’t available. If no projected usage exists, the default value is zero.

Weighted average

(Annual usage x Annual usage weight) + (Projected usage x Projected usage weight)

Usage value Usage quantity x Unit cost

3. In the ABC System Options window, determine if items with zero on hand quantities and zero usage should be assigned no ABC code. To have items with negative on-hand and usage quantities treated as if they had zero on-hand quantities, mark the second option.

Refer to ABC analysis and zero or negative item quantities for more information.

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Choose Next.

If your analysis is based on on-hand inventory value or unit cost Skip to step 7. The on-hand inventory value and unit cost methods assume that calculations will be based on historical annual usage for calendar years.

If your ABC analysis is based on usage value or quantity The ABC Calendar Option window opens. Continue with the next step.

4. In the ABC Calendar Options window, select the periods to be used to calculate ABC information. You can choose Fiscal Periods or Calendar Months. Choose Next.

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5. In the ABC Usage Quantity window, select how you want to control the calculation based on usage quantity or usage value. You can choose to use historical or projected numbers or a combination of both.

If you select Weighted Average, enter the weight percentage for historical and projected usage. Choose Next.

6. In the ABC Breakpoints window, specify if percentages, currency amounts, or quantities will be used to define breakpoints for the analysis. (Options depend on the type of analysis option you selected earlier.)

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A breakpoint is the boundary between two adjacent ABC classifications—for example, if you want A items to be those that reflect 80 percent of inventory value, 80 percent would be the breakpoint. Enter the percentages or amounts for the A and B breakpoints.

If you are using percentages to define breakpoints, be sure to enter the percentage of inventory value. For example, if you want your A items to be those that make up 75 percent of your inventory valuation, you’d enter 75 as the A Breakpoint.

7. Decide if you want to preview the results of the analysis before having item records updated with new ABC codes.

Preview suggested ABC codes

If you have a large number of item records, opening the Preview window might take some time.

Or finalize item records without previewing

Print the following reports for your permanent records. Refer to the table for information about navigating to the reports.

Report Path

Stock Status Report Reports >> Inventory >> Activity

Purchase Receipts Report Reports >> Inventory >> Activity

Turnover Report Reports >> Inventory >> Analysis

Transaction History Report Reports >> Inventory >> History

Serial Number List Reports >> Inventory >> Serial/Lots

Lot Number List Reports >> Inventory >> Serial/Lots

e) Print any additional reports you will need for planning or your permanent records. If you plan to remove sold Purchase Receipts during the year-end closing process, we recommend that you print the Purchase Receipts Report to review the receipts that will be removed.

4. Make a backup of your company data, following your company’s backup procedures.

Make a backup of all Company data. This is important to ensure that you will be able to recover quickly should a power fluctuation or other problem occur during the year-end closing procedure.

Once you have completed these preliminary steps, you are ready to close the year.

5. Close the year.

Closing a year accomplishes the following tasks:

a) Closing a year transfers all summarized current-year quantity, cost, and sales amounts to transaction history for the items that have summarized sales history. When you close a year, you also have the options to remove certain records and update standard costs.

b) Updates the Item's Beginning Quantity to the Quantity on Hand at each Site. Certain reports, such as the Turnover Report, use the Beginning Quantity field for report calculations.

c) Zeros the Quantity Sold field in Item Quantities Maintenance (Cards >> Inventory >> Item >> Qtys/Sites) for each Site.

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d) Remove Purchase Receipts for Items that have been completely sold.

e) Remove any discontinued Items from the Item records that have been completely sold.

f) Remove any Lot attributes from the records of Lot Numbered Items if they have been completely sold.

g) Updates the Standard Cost of each Item to the current Cost if you are using either the FIFO periodic or LIFO periodic Valuation Method.

Uses the Inventory Year-End Closing (Routines >> Inventory >> Year-End Close) to close the year

h) Use the following descriptions to learn more about each option:

i) Remove: Discontinued Items - If you mark the Discontinued Items option, all discontinued Items that have a zero balance will be removed during the year-end closing process. (Items can be designated as discontinued using the Item Maintenance window.) Discontinued Items that have a Quantity On Hand of zero (except for kit components) and do not have any unposted transactions will be completely removed from the Inventory module. Note - If using the Service module, verify whether any discontinued Items exist on any unposted service documents. If so, the documents must be posted before proceeding. The Sales Order Processing, Invoicing, or Purchase Order Processing reports and inquiries will still be able to pull information regarding these discontinued Items, however you will not be able to do a lookup on the Item Number since it has been removed from the Item Master. If you would like to print a report or inquire on the discontinued Item, you will need to include the Item within the Item Number Range.

j) Remove: Sold Receipts - If you mark Sold Receipts, all Sold Receipts whose Quantity Received and Quantity Sold amounts are equal will be removed. This is an optional step and may not be a procedure that is done every year-

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end. These values may be helpful when Items are returned through Invoicing so you may not want to remove the Receipts from the file.

k) Remove: Sold Lot Attributes - If you mark Sold Lot Attributes, values for completely sold Lot Numbers will be removed. For example, you can remove the value red for the Lot attribute color if you have sold all Lot Numbered Items that have been assigned the value red.

l) Update: Item's Standard Cost - If you mark Item's Standard Cost, the Standard Cost for any Items that have been assigned the FIFO periodic or LIFO periodic Valuation Method will be adjusted automatically to reflect each Item's current Cost or the amount you most recently paid for the Item.

When you have selected all the options you want, choose OK to begin the year-end closing process. While the year is being closed, you will not be able to post, reconcile Quantities, change Valuation Methods or change Decimal Places for Items

Close the fiscal periods for the Inventory series (optional).

m) You can use the Fiscal Periods Setup window (Setup >> Company >> Fiscal Periods) to close any fiscal periods that are still open for the year. This keeps transactions from accidentally being posted to the wrong period or year. Be sure you have posted all transactions for the period and year for all modules before closing fiscal periods. If you later need to post transactions to a fiscal period you have already closed, you will need to return to the Fiscal Periods Setup window to reopen the period before you can post the transaction.

6. Make a final backup.

Make a final backup of your Company's data files and keep it in safe, permanent storage. This gives you a permanent record of the Company's financial position at the time you closed the year, and can be restored later if necessary.

Inventory Year-End Closing Tips

The year-end close must be done before any transactions for the new year have been posted.

You have the option of marking Discontinued Items, Sold Receipts or Sold Lot Attributes. If marked, all Items, Sold Receipts or Sold Lot Attributes that have a zero balance will be remove during the year-end closing process.

If you mark Update Item's Standard Cost, the Standard Cost for any Items that have been assigned the FIFO periodic or LIFO periodic Valuation Method will be adjusted automatically to reflect each Item's current Cost, which is the amount you most recently paid for the Item.

There is no Year-End Closing report for Inventory.

Inventory Year-End Q & A

Q1: How is the Average Cost of an Item updated throughout the year and during the year-end closing process when using the Average Perpetual Method of Costing?

A1: If you are using the Average Perpetual Costing Method, all Receipts for each Item will be averaged to determine the Average Cost. Even if Quantities are sold, the Average does not change until another Purchase Receipt for the Item is posted to the Inventory Purchase Receipts File. The year-end closing process does not change the Average Cost, but it will remove the Purchase Receipts that have been completely sold. The next

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time a Receipt is entered, the Average Cost will be revalued with the Receipts that remain in the Inventory Purchase Receipts File.

Q2: Can the Inventory Year-End Closing window (Routines >> Inventory >> Year-End Close) be used throughout the year to update the standard Cost of Items if using the Periodic Valuation Method?

A2: This is not recommended because the Beginning Quantity field is updated during the year-end closing process. This would make that field incorrect on reports such as the Turnover Report.

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ACCOUNTS RECEIVABLE

Closing a Year

!! Before you close the year, make a backup of all company data. If you have a

current backup, information can be restored if necessary. It is not necessary to perform the Receivables Management Fiscal Year-end Close on December 31st. You do not have to wait until you close before posting Receivables batches to the New Year. However, the Calendar Year-end close is not Date Sensitive. This procedure should be done at Year-end (December 31st). The Calendar Year-end closing affects only finance charge amounts. Closing the CALENDAR Year (Sales Area >> Routines >> Sales >> Year-End Close) will clear the calendar year-to-date finance charges and move them to the Last Year calendar field in Customer Finance Charge Summary (Sales Area >> Cards >> Sales >> Summary >> Finance Charges). Closing the FISCAL Year (Sales Area >> Routines >> Sales >> Year-End Close) will transfer amounts other than the calendar year-to-date finance charge amounts to the Last Year column in Customer Summary (Sales Area >> Cards >> Sales >> Summary). It will only transfer those amounts that fall into the fiscal year being closed. Amounts entered for the new fiscal year will remain in the Year-to-date column.

Receivables Management CALENDAR Year-End Closing Overview 1. Calendar year-end close: Post all transactions for the calendar year and complete

the month-end procedures for December. 2. Make a backup that can be restored. 3. Close the year using the Receivables Year-End Closing window (Sales Area >>

Routines >> Sales >> Year-End Close >> Mark the Calendar radio button)

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a. Close the fiscal periods for the Sales series using the Fiscal Periods Setup window

(optional).

b. Close the sales tax periods for the year using the Tax Year-End Closing window (optional).

c. Make a final backup.

Detailed Receivables Management CALENDAR Year-End Closing Checklist 1. Post all transactions for the current fiscal year. We recommend that you also post all transactions for the calendar year before closing the year. 2. Make a backup of all company data. This is important to ensure that you will be able to recover quickly should a power fluctuation or other problem occur during the year-end closing procedure. 3. Close the fiscal or calendar year. Select which year you wish to close in the Receivables Year-End Closing

(Sales Area >> Routines >> Sales >> Year-End Close) window. Choose Calendar, Fiscal, or All.

Mark the Print Report box. This report will list the amounts that were transferred to last year for each customer.

The Year-End Closing Report is part of the audit trail and should be saved with your company's permanent records.

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4. Close the fiscal periods for the Sales series (optional).

(Sales Area >> Setup >> Company >> Fiscal Periods) window to close any fiscal periods that are still open for the year. This keeps transactions from accidentally being posted to the wrong period or year.

Be sure you have posted all transactions for the period and year for all modules before closing fiscal periods.

If you later need to post transactions to a fiscal period you have already closed, you will need to return to the Fiscal Periods Setup window to reopen the period before you can post the transaction.

5. Close the sales tax periods for the year (optional).

Use the Tax Year-End Closing window (Sales Area >> Routines >> Company >> Tax Year-End Close) to close the sales tax periods and to print the Tax Year-end Closing report.

This procedure should be completed only after you have completed the year-end closing procedures for all sales and purchasing modules.

6. Make a final backup of your company's data files and keep it in safe, permanent storage.

This gives you a permanent record of the company's financial position at the time you closed the year and can be restored later if necessary.

Receivables Management FISCAL Year-End Closing Overview 1. Post all transactions for the current fiscal year. 2. Make a backup that can be restored. 3. Close the year using the Receivables Year-End Closing window. 4. Close all fiscal periods for the Sales series using the Fiscal Periods Setup window

(optional). 5. Close the sales tax periods for the year using the Tax Year-End Closing window

(optional). 6. Make a final backup.

Detailed Receivables Management FISCAL Year-End Closing Checklist 1. Post all transactions for the current fiscal year before closing the year. 2. Make a backup of all company data.

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3. This is important to ensure that you will be able to recover quickly should a power fluctuation or other problem occur during the year-end closing procedure.

4. Close the fiscal year.

a. Select to close the fiscal year in the Receivables Year-End Closing window (Sales Area >> Routines >> Sales >> Year-End Close) Mark Fiscal, Calendar, or All.

b. Mark the Print Report box. This report will list the amounts that were transferred to last year for each customer.

c. The Year-End Closing Report is part of the audit trail and should be

saved with your company's permanent records. 5. Close the fiscal periods for the Sales series (optional).

a. You can use the Fiscal Periods Setup (Sales Area >> Setup >> Company

>> Fiscal Periods) window to close any fiscal periods that are still open for the year. This keeps transactions from accidentally being posted to the wrong period or year.

b. Be sure you have posted all transactions for the period and year for all modules before closing fiscal periods.

c. If you later need to post transactions to a fiscal period you have already closed, you will need to return to the Fiscal Periods Setup window to reopen the period before you can post the transaction.

6. Close the sales tax periods for the year (optional).

a. Use the Tax Year-End Closing window (Sales Area >> Routines >>

Company >> Tax Year-End Close) to close the sales tax periods and to print the Tax Year-end Closing report.

b. This procedure should be completed only after you have completed the year-end closing procedures for all sales and purchasing modules.

7. Make a final backup of your company's data files and keep it in safe, permanent storage.

8. This gives you a permanent record of the company's financial position at the time you closed the year, and can be restored later if necessary.

Receivables Management Year-End Closing Tips 1. Closing the calendar year will clear the calendar year-to-date finance charges and

move them to the last year field on the customer records. 2. This information is not date-sensitive so the Calendar Year-End close should be

done at the end of the calendar year.

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3. If you have Finance charges to post into the New Year wait until you have performed the Calendar Year-End Close so your summary information at Sales Area >> Cards >> Sales >> Summary >> Credit Summary will not be misstated for finance charges.

4. The calendar year-end close in Receivables will take place at the end of the calendar year regardless of when your fiscal year-ends. If your calendar year coincides with the fiscal year, you will close both at the end of the calendar year.

5. The YTD Finance Charges do not automatically print on the statements in December

and January. If you want them to print on the statements you must modify them using the following procedures. The procedure for getting the YTD finance charges on the December and January statements takes two different steps, one for each month. December: Create a modified version of the statement and link the Customer MSTR Summary file to the report.

a. In the Report Layout window, place the CYTD Finance Charges field (in

the Customer MSTR Summary file) on the report. b. Save the report and print it.

January: Create a modified version of the statement and link the Customer MSTR Summary file to the report.

a. In the Report Layout window, place the LYTD field (in the Customer MSTR Summary file) on the report.

b. Save the report and print it.

6. If you wait until after January to run the Calendar Year-end Close, any finance charges assessed during January will not update the year-to-date finance charges until after the calendar year-end close.

7. Closing the fiscal year will transfer all amounts other than the calendar year-to-date

finance charge amounts to last year (using the Transaction Date). Example 1 - You are closing the fiscal year 2007. An Invoice for $100 has been posted into the year 2008. Before closing, Year-to-date Sales displays as $500. After closing, only $400 will move to the Last Year column as the $100 will remain in the Year to Date column. Example 2 - You have closed the fiscal year 2007. It is now February 2008. Year-to-Date Sales displays as $100 for 2008. You must post an invoice into 2007 due to an error. Year-to-Date Sales will remain at $100, but Last Year’s Sales will increase correctly by $100.

8. (OPTIONAL) You can reconcile Fiscal and Calendar Year information by running a

Reconcile on Calendar or Fiscal Year information. This will reconcile your summary information to your detailed transactions. Summary information will be updated accordingly (Sales Area >> Utilities >> Reconcile >> Mark Calendar or Fiscal Year).

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Year-End 29

ACCOUNTS PAYABLE

Make sure you install the year-end update because it has updates for Payables Management.

Changes in the Year-End Update that Affect Payables On the 1099-DIV form, boxes 2c, 2d, 3, 4, 5, 6, 8 and 9 have been moved so that the information is printed in the appropriate box, which fixes an issue from previous releases.

Calendar-Year Closing Procedures Payables Management (PM) Year-end Closing Procedures may not be necessary. You can post a transaction to a prior or subsequent year and it will not affect your current year's 1099 information or Vendor Financial Summary reports. The system will automatically post to the correct fiscal and calendar years according to the dates of the transactions. So you would not have to close your Payables Management and, if you do, it may not matter if you close after the fact that transactions have been posted since the last day of the fiscal or calendar year depending if you use the Amounts Since Last Close option described below. Closing the year only affects the 'Amounts Since Last Close' view within the Vendor Yearly Summary window (Cards >> Purchasing >> Summary >> (choose a Vendor) >> Yearly). This view is used for informational purposes along with as an option when you print your Vendor Financial Summary report (Reports >> Purchasing >> Setup/Lists >> Vendor Financial Summary). On this report you will have the option to print for Amounts Since Last Close, Fiscal Year, or Calendar Year. Closing the year would only affect the Amounts Since Last Close option. When printing 1099s (Purchasing Area >> Routines >> Print 1099), you will have the ability to print whichever year is desired.

!! We recommend that you post all transactions for the calendar year before closing the year. To enter future-period transactions before closing the year, create a batch with new transactions, but do not post it until after the year has been closed.

Before you close the year, make a backup of all company data and store it in a safe place. As long as you have a current backup, information can be restored, if necessary.

Using Checklists to Perform Year-End Procedures A checklist is available which lists the tasks you need to complete to close the year. To use the checklist: 1. Open the Purchasing Checklists window.

(Purchasing Area >> Routines >> Checklists) 2. Select a frequency.

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Choose Calendar Year if it is the end of the calendar year and you also need to print 1099 statements.

Choose Fiscal Year if you are closing the fiscal year.

Use the following procedures as a guide for completing each task. 3. Select the first task in the list and the appropriate window will open. Complete all

the tasks in the list, and close the window.

Printing 1099 Statements For information specific to each field in this window, move the pointer to the field and choose Help >> About this item. 1. Open the Print 1099 window.

(Purchasing Area >> Routines >> Print 1099)

2. Enter payer’s information, including the address ID and the Payer’s Federal ID number which is your company’s tax registration number.

3. In the 1099 Type field, select Miscellaneous, Dividend or Interest as the 1099

type. If you need more information about which type of document to print, refer to the instructions provided by the U.S. Internal Revenue Service.

4. Select a form type. Select Continuous if you will be printing the 1099 forms on a

dot-matrix printer using continuous (attached) forms. Select Single Feed if you will be printing the 1099 forms on a laser printer (or similar printer) and will be using forms that are printed on separate pieces of paper.

5. Select a range from the list. Enter a range restriction and indicate whether you

want to print a 1099 statement for all vendors of the 1099 type chosen, or for a selected range of vendors.

6. Select printing options.

To print an alignment form before printing the 1099 forms, mark Alignment Form. The alignment form will ensure that the amounts are printed in the proper places on the forms.

To print the 1099 forms, mark 1099 Form. Then select the order in which you want the 1099 forms to be printed.

7 The 1099 form has multiple boxes where different types of expenses can be

printed. Select the type of expense you are reporting. 8. You can print the 1099 Edit List to review the information that will appear on the

1099 forms. To print the report, choose File >> Print. This report shows each vendor’s name and the amount reported for that vendor. You may want to print this report before and after printing the 1099 forms. The first report can be used to check for errors and the second can be kept as part of your company’s permanent records.

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9. When you are ready to print the 1099 forms, mark the 1099 Form option, then choose Print.

Closing a Calendar Year When you have finished printing the 1099 forms, you are ready to close the calendar year. We recommend that you print an Aged Trial Balance with Options Report to show the status of each vendor account. If you are closing the fiscal year along with the calendar year, we recommend that you print the Vendor Period Analysis Report and the Vendor Year-to-Date Summary reports for your permanent records because these amounts will be transferred to last year during the year-end closing process.

!! Before you close the year, make a backup of all company data and store it in a safe place. As long as you have a current backup, information can be restored, if necessary.

To close a calendar year: For information specific to each field in this window, move the pointer to the field and choose Help >> About this item. 1. Open the Payables Year-End Closing window.

(Purchasing Area >> Routines >> Year-End Close)

2. Select which year you want to close. If the calendar year coincides with your

fiscal year, select all. If they don’t coincide, close the fiscal year separately. Refer to the Closing a fiscal year procedure later in this chapter for additional information about closing a fiscal year.

3. Mark the Print Report box to print the Year-end Closing Report after the closing

process is complete. This report lists the amounts transferred to last year for each vendor. The Year-end Closing Report is part of the audit trail and should be saved with your company’s permanent records.

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4. Choose Close Year to begin the closing process. The Year-end Closing Report will be printed after the year has been closed, if you selected to print the report.

Closing a Fiscal Year Closing the fiscal year will transfer all the amounts other than the 1099 amounts to last year. This procedure should be performed before you begin entering transactions for a new fiscal year. However, if you enter transactions for a new fiscal year before closing the past year, be sure to create a new batch for those transactions and wait to post it until the fiscal year has been closed. We recommend that you print an Aged Trial Balance with Options Report to show the status of each vendor account. This report should be kept with your permanent records as part of the audit trail. If you are closing the fiscal year along with the calendar year, we recommend that you print the Vendor Period Analysis Report and the Vendor Year-to-Date Summary reports for your permanent records because these amounts will be transferred to last year during the year-end closing process. !! We recommend that you post all transactions for the fiscal year before closing the

year. To enter future-period transactions before closing the year, create a batch with new transactions but don’t post it until after the year has been closed.

Before you close the year, make a backup of all company data and store it in a safe place. As long as you have a current backup, information can be restored, if necessary. To close a fiscal year: 1. Open the Payables Year-End Closing window.

(Purchasing Area >> Routines >> Year-end Close)

2. Select Fiscal or All to close the fiscal year. If your calendar and fiscal years coincide, you can close them at the same time by selecting all.

3. Mark the Print Report box to print the Year-end Closing Report after the closing

process is complete. This report lists the amounts that were transferred to history for each vendor. The Year-end Closing Report is part of the audit trail and should be saved with your company’s permanent records.

4. Choose Close Year to begin the closing process. The Year-end Closing Report

will be printed after the year has been closed, if you selected to print the report. Closing Procedures Reference The following information is an alphabetical listing of the fields, windows, and reports used when closing Payables Management years. Information about the fields, windows and reports, such as where and how it is used, is provided. For more specific information about any of these topics, refer to the online help. 1099 Box Number

Identifies the box on the 1099 form provided by the IRS that the 1099 amount will be printed in. The choices available depend on the 1099 type selected. If you need more information, refer to the instructions provided by the IRS.

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1099 Type

Specifies the type of 1099 statement you will be printing. You can print Miscellaneous, Dividend or Interest statements. If you are unsure of which type of report to print, refer to the documentation provided by the IRS.

Form Type

The type of form you will be using to print the 1099 statement.

Option When to use:

Continuous If you are using a dot-matrix printer using continuous, or attached, forms.

Single Feed If you are using a laser (or similar type) printer and using forms that are printed on separate pieces of paper.

Minimum Required

The minimum amount a vendor must have been paid in order to print a 1099 statement for the vendor. If the vendor was paid less than this amount during the current calendar year, no 1099 statement will be printed. You can view the 1099 amount paid this year in the Vendor Yearly Summary Inquiry window (Purchasing Area >> Inquiry >> Vendor Yearly). Payables Year-End Closing window A window used for selecting a year to close and closing the year. You also print the Year-end Closing Report from this window.

Payer’s Federal ID Number Identifies the number assigned to your company by the IRS.

Print 1099 window A window used for entering information for and printing 1099 statements for your vendors.

Year to Close

An option for selecting the year to close. If your calendar and fiscal years coincide, they can be closed simultaneously. If they are different, each will need to be closed separately.

Year-end Closing Report Displays the amounts that were moved from the current year to the previous. If you closed the calendar year, the report will show 1099 amounts moved to the Last Year amount in the Vendor Yearly Summary window. If you closed your fiscal year, it will show vendor financial information moved to last year in the Vendor Yearly Summary window.

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FIXED ASSETS

Changes in the Year-End Update Fixed Assets New Special Depreciation Allowance

Year-End Processing We recommend closing Payables Management before closing Fixed Assets since Fixed Assets is not a date-sensitive module. This way you can ensure all transactions coming from Payables have been capitalized in the Fixed Assets system. Also, we suggest closing Fixed Assets prior to performing the General Ledger year-end close. The year-end routine can be run at a separate time for each fixed asset book or it can be run for all books at the same time, however, it must be completed before processing any fixed asset transactions in the new year. Before the year-end process is performed, be sure that depreciation has been calculated through the last day of your fiscal year. You will also want to interface to General Ledger and print any reports that print year-to-date depreciation. Year-end will zero out year-to-date depreciation and year-to-date maintenance. It will also copy quantity to beginning quantity, cost basis to beginning cost, salvage to beginning salvage, and life-to-date depreciation to beginning reserve. !! All files should be backed up before running year-end. This will enable you to

reload these files later if needed, for example, if an auditor requests a report that you did not print before the year-end process.

We recommend that you rebuild your fixed assets fiscal year calendar file after you change the Fiscal Period Setup or add additional years to the setup. To rebuild the calendar, go to (Financial Area >> Utilities >> Fixed Assets >> Build Calendar).

1. Open the Fixed Assets Year-end Window. 2. Select the book(s) to be processed during year-end. 3. Insert the book(s) into the selected books box. 4. Click the Continue button.

Fixed Assets Year-End Closing Steps 1. Open the Asset Year-End window.

(Financial Area >> Routines >> Fixed Assets >> Year-end)

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2. Select the book(s) to be processed during the year-end. Determine the books

upon which year-end processing is to occur. Highlight the book(s) in the Available Books list. Verify that the Current Fiscal Year is correct for each book. If it isn’t correct, it should be corrected before proceeding. Year-end updates the Current Fiscal Year for each book.

3. Insert the book(s) into the selected books box.

Press Insert >> to insert the highlighted available book(s) into the Selected Books list. If all books are to be selected, click All >>

4. Click the Continue button. After entering the required fields =described above, click Continue. The year-end process will begin. A report is not generated from this process. You can run various reports and use inquiries to verify the results of the year-end process.

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MULTICURRENCY

Closing a Year If you use Multicurrency Management, you will close the year using the Year-End Closing window just as you would for General Ledger. However, different reports will be printed for Multicurrency Management. The Multicurrency Year-End Closing Report will be printed in place of the General Ledger Year-End Closing Report if you use Multicurrency Management. The Multicurrency Year-End Closing Report displays the profit and loss accounts that were closed to the retained earnings account when the year-end closing process was complete, along with functional and originating amounts that were closed. If you have not assigned all currency IDs to your retained earnings account using the Select Account Currencies window, the Multicurrency Retained Earnings Exception Report also will be printed. This report displays all retained earnings accounts for which multicurrency transactions were closed, even though the currency for the multicurrency amounts was not assigned to the retained earnings account. If you did not intend to close these accounts to the retained earnings account, you can use this report to determine amounts you will need for correcting these transactions. For more information on closing the year, refer to the General Ledger documentation. If you want to review the Multicurrency Year-End Closing Report, Multicurrency Retained Earnings Exception Report or General Ledger Year-End Closing Report, refer to the online sample reports.

Multicurrency Management Receivables – Period-End

Period-end procedures Period-end procedures usually are completed at the end of the month. You can, however, complete these tasks at any point in the accounting cycle. You also can use the month-end checklist routine to print multicurrency receivables statements. Print multicurrency receivables statements to show current customer activity including period aging information, the total amounts due and payments received. Using Multicurrency Management, you can print statements that include a subtotal for each currency that the customer has utilized. Printing multicurrency receivables statements Statements are itemized lists of charges, including period aging information, total amounts due and payments received. These documents are sent to customers as bills. Using multicurrency versions of the Receivables Management customer statements, you can print statements in your customer’s currency. If you have conducted business with them in multiple currencies, you can print statements that will include a subtotal for each currency with activity. Use the Print Receivables Statements window to identify the information you want to include on customer statements.

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Use the steps in the following short checklist to complete the procedure. Following the checklist, each step is repeated with detailed information about entries that are required or optional, as well as information on how to print related reports.

1. Open the Print Receivables Statements window. 2. Select statement specifications. 3. Select dates. 4. Select printing specifications. 5. Select a range of customers. 6. Save or print the statements.

1. Open the Print Receivables Statements window.

(Sales Area >> Routines >> Statements) 2. Select statement specifications.

Enter a statement ID and description.

To print a statement in an existing format, simply select the statement ID and choose Print. Select a form on which to print the statements. Choose the Multicurrency Long or Multicurrency Blank form. On the Multicurrency Long Form, a page break will separate each currency’s activity if the customer has conducted business with you in multiple currencies. The Multicurrency Blank form contains a summary of current activity and each currency’s outstanding balances.

For example, if the currency ID used on your customer’s transactions is GERMAN, the customer statement will show outstanding amounts in German deutsche marks only. If the customer’s transactions are in both British pounds and French francs, two sections will appear on the statement—one for the British pound transactions and a second for the French franc transactions. To sort the information on the statements, select the order in which the customer information will print. Then, indicate the order in which documents will be printed for each customer. For an illustration of a Multicurrency Receivables Statement, refer to the online sample reports.

3. Select dates.

Select a statement date if you want to use one other than the default. Select a date in the ‘Summarize to’ field if you want to include summarized transactions. Transactions posted on or before this date will be summarized and the total balance of those transactions will be displayed; transactions posted after this date will be displayed in detail. Enter a cutoff date to print statements for transactions through the specified date. For a description of each date option, refer to the Printing statements procedure in the “Procedures” chapter of the Receivables Management manual.

4. Select printing specifications.

There are eight options for limiting the customer accounts for which statements will be printed. Select one or more printing options. For a description of each printing option, refer to the Printing statements procedure in the “Procedures” chapter of the Receivables Management manual.

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To print an alignment form, mark Alignment Form. When you have printed an alignment form and your forms are positioned correctly in the printer, mark Statements. Select an account type: open item, balance forward or both. You may want to print statements for open item and balance forward accounts separately if you use different forms for each. Select to print credit limits, payment terms, finance charges and messages on the statements. Credit limits will be displayed in the functional currency of the company. To include a message, choose Messages to enter or select a message using the Sales Statement Message Entry window. When you have made your selection, choose OK to redisplay the Print Receivables Statements window.

If the minimum payment amount for a customer is a currency amount, it also will be shown in your company’s functional currency on customer statements.

5. Select a range of customers. Select a range of customer records. You can choose all customers or those in a specified range. If you choose to print statements for a range of customers, select a range from the list and enter a range restriction. Then choose Insert to display the restriction in the Restriction list. For more information, refer to the Printing statements procedure in the “Procedures” chapter of the Receivables Management manual.

6. Save or print the statements. Choose Save to save the statement options or choose Print. If asterisks (***) appear in fields on the statement, the amount was not calculated based on the setup options you have selected.

Multicurrency Management – Year-End

Consolidating & closing a period If you use Multicurrency Management, you will consolidate periods using the Period Consolidation window and close periods using the Fiscal Periods Setup window, just as you would do using General Ledger. However, different reports will be printed if you also use Multicurrency Management. The Multicurrency Period Consolidation Report will be printed in place of the General Ledger Period Consolidation Report if you are using Multicurrency Management. The Multicurrency Period Consolidation Report includes all multicurrency transaction detail that is consolidated into summary information during the period consolidation process. For more information on consolidating and closing a period, refer to the General Ledger documentation. If you want to review the Multicurrency Period Consolidation Report or the General Ledger Period Consolidation Report, refer to the online sample reports.

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GENERAL LEDGER

Closing a Year in General Ledger Closing a General Ledger year transfers financial account and transaction information from open year to history (if you keeping history records), and prepares the General Ledger for a new fiscal year. You can enter General Ledger transactions for the next fiscal year without closing the current year, leaving fiscal years open until all adjusting entries have been entered and posted to the correct periods. Dynamics GP allows unlimited open years. If you use Management Reporter or FRx for reporting, you will need to close the year to have correct balance-forward reports or add some additional columns to compute beginning balances. In addition to transferring open-year amounts to transaction and account history, the year-end closing process will:

Reconcile and summarize the General Ledger balances that have accumulated throughout the year.

Transfer open-year profit and loss amounts to the Retained Earnings account. Zero all profit and loss account balances after closing to the Retained Earnings

account. Summarize balance sheet accounts, bringing the balances forward as the

accounts’ beginning balances in the new fiscal year. Remove inactive accounts with zero balances.

Print the Year-End Closing Report.

You can continue to work in Dynamics GP during the year-end closing procedure. However, you will not be able to post while the year is being closed. Up to this point, you should have entered all final adjusting entries for the fiscal year and printed final financial statements. (You can set up a group of year-end reports in the Financial Groups window that will collectively print the financial statements and trial balance each time you close the fiscal year.) When the year-end closing process is complete, print the financial statements again and compare the balances. !! Before you begin closing a year, work with your system or database administrator

to ensure that a complete backup of your company’s accounting data is made.

**Note - During the Year-End Close, all records that will be moved during the routine are put in a temp table before moving to the GL30000. Therefore, there is a need for free disk space equaling the size of the GL20000 table.

Year-End Closing Procedures

1. Complete month-end and period-end procedures for all modules, except General Ledger. 2. Post final adjusting entries in General Ledger.

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3. Print Account List to verify the Posting Type. 4. Close the last period of the current fiscal year (optional). 5. Perform File Maintenance on all Financial files. 6. Make sure Maintain History for Accounts and Transactions is marked in Financial Area >> Setup >> General Ledger (if you want to keep history

records). 7. Back up your data. 8. Print a final Detailed Trial Balance. 9. Print final financial statements. 10. Set up a new fiscal year. 11. Close the current fiscal year. 12. Close all fiscal periods for all series (optional). 13. Adjust budget figures for the new year and print financial statements. 14. Make a backup.

Year-End Closing Procedures (Summary) 1. Complete month-end and period-end procedures for all modules, except General

Ledger.

For more information, refer to the appropriate module reference manual. If General Ledger is not integrated with other modules, you can skip this step. If General Ledger is integrated with other modules:

Use normal posting procedures to post final transactions in all modules, except

General Ledger.

After all transactions have been posted successfully, complete month-end and quarter-end procedures for all modules (except General Ledger) in the following order: Inventory, Receivables Management, and Payables Management.

!! Payroll year-end procedures are independent of those in other modules,

and are performed at the calendar year-end. 2. Post final adjusting entries in General Ledger.

If you need to make any adjusting entries to allocate revenue, expenses or depreciation to the year you are going to close, use the Transaction Entry window or the Quick Journal Entry window to enter adjusting entries in General Ledger

The Second Closing Period feature in General Ledger allows you to have a second closing period with the same From/To date as the last day of the first closing period. This can allow you to enter initial adjusting entries in the first closing period, and post-audit entries in the second closing period 14. (This allows for separate tracking of the adjusting entries made after the year is closed.)

NOTE: If using Fixed Assets you cannot have a second closing period.

To successfully post into period 14 these requirements must be met:

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a. The additional fiscal periods must be set up before closing the year.

b. The year must then be closed.

c. In the Fiscal Period Setup Window, you must mark all the financial periods as closed, except period 14.

With these requirements being met, a transaction could be posted to 12/31/06 and it will be considered a part of period 14.

If you need to make any adjusting entries to allocate revenue, expenses or depreciation to 2012, use the Transaction Entry window or Quick Journal Entry window to enter adjusting entries in General Ledger.

Adjusting entries include all entries that correct errors made in recording transactions and journal entries used to assign revenues or expenses to the period in which they were earned or incurred.

Many of these adjusting entries will have been made automatically if you marked them as reversing in the Transaction Entry window. Entries that increased assets or liabilities could be entered as automatically reversing since they would result in a future cash receipt or payment.

3. Verify the Posting type. Use the Accounts SmartList to verify the posting type is correct for all of your

accounts. Use the Columns button to add the Posting Type column if necessary. If the account’s balance is brought forward at the end of year, it should be sent

up as a Balance Sheet Posting Type. If the account’s balance will be closed to a retained earnings account at the end

of the year, it should be set up as a Profit and Loss Posting type. Use the Account Maintenance window if the Posting Type needs to be changed

for an account. 4. Close the last period of the current fiscal year (optional).

Use the Fiscal Periods Setup window to close any fiscal periods that are still open for the current fiscal year. This keeps transactions from accidentally being posted to the wrong period or year.

!! Be sure you have posted all transactions for the period and year for all modules before closing fiscal periods. If you later need to post transactions to a fiscal period you have closed, you will need to return to the Fiscal Periods Setup window to reopen the period before you can post the transaction.

5. Perform Table Maintenance Procedures Check links on all of the Financial tables. 6. Check General Ledger Settings

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If you want to keep historical records, make sure that Maintain History for Accounts and Transactions are marked in General Ledger Setup. Account history allows you to print historical financial statements and calculated budgets from historical information. Transaction history allows you to print historical detailed trial balances and to drill down to transaction detail. Both account history and transaction history are updated during the year-end close process if these options are marked.

7. Make a backup.

Be sure to use your company’s backup utility to back up all of your company data before continuing. Backups allow you to recover data if something happens, such as a power failure, during the closing.

8. Print a final Detailed Trial Balance.

Use the Trial Balance Report window to print a year-end Detailed Trial Balance.

!! Be sure you have posted all transactions for the period and year for all modules before printing the Detailed Trial Balance. If you later need to post transactions, you should print a new Detailed Trial Balance.

9. Print final financial statements.

Print any year-end financial statements required. 10. Set up a new fiscal year.

Before you can perform a year-end closing, a new fiscal year must be set up using the Fiscal Periods Setup window. For example, if you are closing 2012, be sure that 2013 has been created.

11. Close the current fiscal year.

(Financial Area >> Routines >> Year-end Closing)

Retained Earnings Account: Using the Year-end Closing window, select the Retained Earnings account to which the year’s profit or loss will be closed. The default account is the one you entered in the General Ledger Setup window when you set up the module. All current-year earnings or losses will be transferred to the account you specify here. If you want to distribute the retained earnings for the year to more than one account, you can enter an allocation account to distribute the retained earnings amount to the

Year-End 43

appropriate accounts. For example, you could set up an allocation account to divide the earnings between several departments in your business. You could transfer the year’s profit or loss to accounts that contain a specific account segment. This is referred to as a divisional retained earnings closing. See Question and Answer section for an example of closing to divisional retained earnings. Starting Journal Entry: Using the Year-end Closing window, enter the starting journal entry number that will be used as the first journal entry number in the next fiscal year. You can either accept the default, which is one more than the highest posted journal entry number for the current year, or enter a new number. The journal entry number you select will be used as the journal entry number for the Year-End Closing Report. Close the Year: Choose the Close Year button to begin the closing process. Closing the year transfers all current-year information for each account in the chart of accounts to account and transaction history (if you are keeping history records) and prepares the accounting system for a new fiscal year.

In addition to transferring current-year figures to transaction and account history, the year-end closing process will:

Reconcile and summarize the General Ledger balances that have accumulated throughout the year.

Transfer current-year profit and loss amounts to the Retained Earnings account. Zero all profit and loss account balances after they’ve been closed to the

Retained Earnings account. Summarize balance sheet accounts, bringing the balances forward as the

accounts’ beginning balances in the new fiscal year. Remove unused segments Print the Year-End Closing Report.

Users at other client computers can continue to work in Dynamics GP during the year-end closing procedure. However, once the Year-End Closing window has been opened, a General Ledger batch activity record, GL Close, is created and will be displayed in the Series and Master Posting windows, and in the system inquiry window, Batch Activity. Posting will not be allowed in General Ledger as long as the GL Close batch activity record is displayed in these windows.

When closing is complete, the Year-End Closing Report will be printed. This report lists the accounts that have been closed and the transactions created to close them. The Year-End Closing Report is part of the audit trail and should be saved with your company's permanent records.

12. Close all fiscal periods for all series (optional). Once closing procedures are complete for all modules, use the Fiscal Periods Setup window to mark all periods for all series as closed. This will prevent transactions from being posted from any module to any period in the year you closed if you are allowing posting to history. Once a period has been marked as closed, transactions no longer can be posted to it, unless it is reopened. Completing this step is optional, and the step should not be completed until you are sure that no adjusting transactions will be needed for the year. If you later

Year-End 44

find you need to post a transaction to a closed period, return to the Fiscal Periods Setup window to reopen the period.

13. Adjust budget figures for the new year and print financial statements.

After closing the year, update all Trial Balance and Cross-Reference report options if you want to print them for another open year. Adjust budget figures using the Budget Maintenance or Single-Account Budget Maintenance windows and print financial statements. In the financial statements, use the Column Definition Setup to change the year to the current fiscal year for any columns setup as Period Range, Year-to-Date and Variable Year-to-Date. Print the Profit and Loss and Balance Sheet to verify that profit and loss accounts were closed to Retained Earnings, and that Balance Sheet accounts have a balance brought forward.

!! After you finish closing a year, work with your system or database administrator to ensure that a complete backup of your company’s accounting data is made.

14. Make a backup.

Be sure to use your company’s backup utility to back up all of your company data before continuing. Backups allow you to recover data if something happens, such as a power failure, during the closing.

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General Ledger Year-End Closing Tips

The year-end closing does not have to be done right at year-end (although it is recommended). General Ledger is the ONLY module that does not have to have the year-end closing routine done right at year-end.

Typically, adjusting entries will have been entered before closing the fiscal year

in General Ledger. Adjusting entries that need to be made after the close of the year can be made and posted to the most recent closed year, provided that ‘Allow Posting to History’ and ‘Maintain History’ are marked in General Ledger Setup. If an entry is posted to the closed year, an automatic second entry is created to update the beginning balances. The following is an example of posting an adjusting entry after closing the fiscal year. Example of Adjusting Entry: 12/25/05 Administration Expenses $500 Cash $500 Example of Posting Journal: 12/25/05 Administration Expenses $500 Cash $500 12/31/05 Retained Earnings $500 Cash $500

If someone has an account that is supposed to be setup as a Profit and Loss

account but was mistakenly setup as a Balance Sheet account, the Profit and Loss account will have a beginning balance brought forward. You would also have a problem with a Balance Sheet account mistakenly setup as a Profit and Loss account, the Balance Sheet account will not have a beginning balance after the year-end close is run. To correct these situations use the following steps: Profit and Loss Account Set Up as a Balance Sheet Account If a Profit and Loss account was setup as a Balance Sheet account, the Profit and Loss account will have a beginning balance after the Year-End close. To correct this situation use the following steps.

1. Back up your data 2. Be sure that the account(s) is still set to the INCORRECT Posting Type.

If Multicurrency IS a registered module, go to Multicurrency Setup (Setup - Financial - Multicurrency) and unmark Maintain History for General Ledger Accounts. If Multicurrency IS NOT a registered module, rename the MC40000.* files located in the company's Finance directory.

3. Go to Setup - Financial - General Ledger, Tools – Setup – Financial – General Ledger and unmark Maintain History for Accounts and Transactions.

4. In this same window, be sure Allow Posting to History is marked. Choose OK to save the changes.

5. Go to Transactions - Financial - General and enter the appropriate journal entry. Be sure the transaction date is in the closed year so that the entry

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goes into history. For example, if the profit and loss account has a debit beginning balance after the year-end close, you would make an entry similar to the one below: Retained Earnings Debit Profit and Loss Account Credit Enter one transaction for each account with an incorrect posting type.

6. Post this entry. The posted transaction(s) will only affect the current year because we have turned off the maintaining history options. It will post a beginning balance transaction into the new year and therefore the accounts will now have the correct balances.

7. Go to Setup - Financial - General Ledger Tools – Setup – Financial –

General Ledger and remark Maintain History for Accounts and Transactions.

8. In this same window, be sure that Allow Posting to History is set correctly.

Choose OK to save the changes.

9. If Multicurrency is a registered module, go to Multicurrency Setup (Tools – Setup >> Financial – Multicurrency) and remark to Maintain History for General Ledger Account. If Multicurrency is not registered, rename the MC40000.* back to the original name.

10. Go to Cards - Financial - Account and bring up the account(s) with the

incorrect Posting Type and change the posting type to the correct one. Balance Sheet Account Set Up as a Profit and Loss Account If a Balance Sheet account was setup as a Profit and Loss account, the Balance Sheet account will have a beginning balance of ZERO after the Year-End close. To correct this situation use the following steps:

1. Back up your data

2. Be sure that the account(s) is set to the CORRECT Posting Type using the Account Maintenance window.

3. Go into the Tools >> Setup >> Financial >> Multicurrency and unmark

Maintain History for General Ledger Account. Note: If not registered for Multicurrency, rename the MC40000.* files located in the company's Finance directory.

4. Go to Tools >> Setup >> Financial >> General Ledger and unmark

Maintain History for Accounts and Transactions.

5. In this same window, be sure Allow Posting to History is marked. Choose OK to save the changes.

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6. Go to Transactions >> Financial - General and enter the appropriate journal entry. Be sure the transaction date is in the closed year so that the entry will update beginning balances. If the balance sheet account should have a debit beginning balance, you would make an entry similar to the one below: Balance Sheet Account Debit Retained Earnings Credit Enter one transaction for each account that had an incorrect posting type.

7. Post the transaction(s). The posting procedure will only affect the current year, because you have turned off the maintaining history options. It will post a beginning balance transaction in the new year and, therefore, the accounts will now have the correct balances.

8. Go to Financial Area >> Setup >> General Ledger and remark Maintain

History for Accounts and Transactions.

9. In this same window, be sure that Allow Posting to History is set correctly. Choose OK to save your changes.

10. If Multicurrency is a registered module, go to Tools >> Setup >> Financial

>> Multicurrency and remark to Maintain History for General Ledger Account. If Multicurrency is not registered, rename the MC40000.* back to the original name.

If you do not close General Ledger at year-end, the user will not get accurate

financial statements for the new year. Beginning balances for the new year are not created until the year-end close process is completed. Therefore, your financial statements for the new year will only reflect current year activity when the year-end closing process is completed. This happens whether the financial statements are printed from Advanced Financial or from FRx.

If a transaction in General Ledger originated in Bank Reconciliation, you will not

be able to drill back to Bank Reconciliation from General Ledger after the General Ledger year-end close has been performed.

General Ledger Year-End Questions & Answers Divisional retained earnings accounts Q: I have these retained earnings accounts set up in my chart of accounts: 100-3300-00 Retained Earnings Division 100 200-3300-00 Retained Earnings-Division 200 300-3300-00 Retained Earnings-Division 300 The segment I am closing on is the division (first segment). Where will the accounts with a 400 division close into, i.e. 400-4100-00 Sales >>division 400? A: Before performing the year-end close, the system will verify that all retained earnings accounts that are needed exist. If a 400 divisional retained earnings account isn't found, the year-end closing will not proceed. An error will occur, and then you will have to set up the needed account.

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Unit accounts at year-end Q: What happens to unit accounts during a year-end closing? A: Unit accounts are treated as balance sheet accounts and will have a balance brought forward when the year is closed. Note: There is a script from Microsoft to clear the beginning balances. Beginning balances showing for sales and expense accounts or Year-End with wrong account type Q: I performed the year-end closing procedure, and beginning balances were brought forward for some of my sales and expense accounts. Why did this happen, and what can I do to correct this? A: In the Account Maintenance window, verify the selection made for Posting Type. Sales and expense accounts need to have Profit and Loss selected on this line. To make corrections now, restore a backup, change the selection in this window, and close the year again or see the General Ledger Tips section for instructions to correct this after the close has been run. Exclusive use Q: I am getting ready to close my year in General Ledger. Must everyone exit Dynamics GP before this routine is performed? A: We recommend that users at other client computers do NOT continue to work in Dynamics GP during the year-end closing procedure. The reason is that transactions may need to be reentered if problems occur during the closing procedure. Allocating net profit Q: I would like to allocate my net profit into my retained earnings or capital accounts on a monthly basis. Also, net profit is supposed to be allocated to three different retained earning or capital accounts. Is this possible? A: No. However, you could enter a non-financial account in the Account Maintenance window. Enter a number outside of your current account numbering scheme. This account will act as a holding or suspense account for the net income/loss. Every month you can post an adjusting entry to the three capital accounts that you wish to adjust; for the offset account, use the holding/suspense account. When the year-end close is completed, use the suspense account for the retained earnings account. This will offset all the manual adjustments made to the suspense account all year. Be sure that the holding account does not show up on reports. Also, when formatting the Balance sheet, put the NP line as the last line on the Advanced Financial Analysis statement and put a page break before it. The Balance Sheet needs an NP line, but that would show the net income/loss two times, so it should be formatted off the financial statement, or use a report type of other.

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Invalid status Q: Why do I have an invalid status on some of my financial reports? A: If a report is marked to use the accelerator file, any changes made to accounts through either the Account Maintenance, Unit Account Maintenance, Mass Modify Chart of Accounts, or Year-End Closing windows will cause the status of financial report printing options to change to Invalid. Before printing financial statements, you will want to update the accelerator file using Reports-Financial-Update Financial Accelerator Information so that your financial statement reflects the most current information about your chart of accounts. Non-financial accounts Q: How are non-financial accounts closed at year-end? A: If the non-financial account is set up with a Balance Sheet posting type, the accounts balance will be brought forward during the year-end close. If the non-financial account is set up with a Profit and Loss posting type, the accounts balance will be closed to retained earnings during the year-end close. Errors/warnings regarding the Year-End Close Q: When I attempt to post a batch in General Ledger, the message "Batches cannot be posted while the year-end close is in progress" appears. The year-end closing is not being run in General Ledger. What should I do? A: Have all users exit any transaction entry window, then, in a SQL Query Tool, run the following queries:

DELETE SY00800 (against the DYNAMICS database) DELETE DEX_SESSION (against the tempdb database) DELETE DEX_LOCK (against the tempdb database)

Q: The following alert message appears when I attempt to close the year in General Ledger: "Sorry, another user is closing the year." No one else is closing the year. What should I do? A: In a SQL Query Tool, run the following query against the company database:

DELETE GL50100 Q: I started the Year-end Close process in General Ledger and a warning message appears. It says "A single -use batch or quick journal transaction has not been posted yet. Do you wish to continue closing?" Is there something wrong? A: This message appears if you have unposted batches in General Ledger. If the batches need to be posted before closing the year-end, choose Cancel. If the batches do not need to be posted before closing the year, choose Continue. Q: I am performing the Year-end Close in General Ledger and it appears to be hanging at 50%. It looks like my workstation has locked up. What should I do? A: If your Year-to-Date Transaction Open file is large, it may take a while for the Year-end Close procedure to complete. If your hard drive is still processing, it is not locked up and you should leave it running. If your hard drive is not processing you should restore a

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backup, do File Maintenance on all files in the Financial series and start the Year-end Close again. Financial reports (Non-FRx/MR) Q: If an adjustment is posted to a closed year, can I print a corrected Trial Balance for that year? A: Yes, set up a new Report Option for the Trial Balance, change the Year to History and choose the closed year. This historical trial balance will include any adjustments posted to the closed year. Q: How does the system determine which financial statement the account I'm entering should print on? A: The category determines which financial (Balance Sheet or Profit and Loss) statement the account you are adding will print on for Quick Financials. However, then you must format the desired accounts in Advanced Financial Analysis. The Posting Type (Balance Sheet/Profit and Loss) is used at year-end closing time to determine which accounts to close into Retained Earnings and which to carry a balance forward for. The Posting Type has no effect on the financial statements. If you are going to use the Advanced Financial Analysis module, specifically tell the program what accounts to print on each statement. Analytical accounting Analytical Accounting is integrated with the General Ledger closing process. When GL is closed, AA data will move from open tables to history tables. To create BBF entries in AA, go to the following windows and set up the options appropriately

Analytical Accounting Options window (Administration area page under Setup | Company | Analytical Accounting) – ‘Include dimensions in the year-end close’

Transaction Dimension Maintenance window (Financial area page under Cards | Analytical Accounting) – ‘Consolidate balances during year-end close’

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PAYROLL

Period- & Year-End Procedures At month-end and quarter-end you can print reports, such as the Department Wage Summary and the 941 Preparation Report. You also have the option of posting the monthly or quarterly SUTA, FUTA, and workers’ compensation tax liabilities to Dynamics GP General Ledger, if that module is part of your Dynamics GP system. The year-end closing program performs two functions. It updates year-end tables (referred to as “files” on the menu) that contain the information required to print W-2 statements and 1099-R forms. It also sets all monthly, quarterly, and yearly amounts to zero and removes all inactive records from the Payroll system, if you select that option.

You can use Dynamics GP to make changes to an employee’s W-2 and 1099-R information before printing the actual statements. For example, you might need to change an employee’s address on his or her W-2 statement.

You can refer to the online documentation for more information about period- and year-end procedures.

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Period-End Procedures (Monthly, Period End or Quarterly) Period-end reporting Use the Period-End Payroll Reports window to print any or all of the month-end or period-end reports. These reports provide monthly summary information about pay codes, departments, job titles, deductions, benefits, state taxes, local taxes, unemployment taxes, and workers’ compensation. You also can post monthly or quarterly SUTA, FUTA, and Workers’ Compensation tax liabilities using this window. Determine whether you want to post these liabilities monthly or quarterly. They should be posted only once to avoid erroneous double entries.

1. Open the Period-End Payroll Reports window. 2. Select a month. 3. Select month-end reports. 4. Select to post liabilities (optional).

1. Open the Period-End Payroll Reports

(HR & Payroll Area >> Reports >> Payroll >> Period-End)

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You also can open this window using the Routines menu. If you need information about using the Payroll Routines window, refer to the System Manager documentation for information about procedures to follow to add or modify selections on the Routines menu.

2. Select a period or month

Select the period(s) or month(s) for which you want to print reports. Be aware that these are stored as separate reports in the reports dictionary. Be consistent in your use of period and month.

3. Select period-end reports

Select the reports you want to print. You can select as many reports as you want. The reports include:

Payroll Summary This report lists gross wages, net wages, advance EIC payments made and monthly, quarterly and yearly amounts of federal and FICA taxes withheld. Pay Code Summary This report lists each pay code, along with monthly, quarterly and yearly hours worked and amounts paid. Pay codes are set up for each employee using the Employee Pay Code Maintenance window.

Department Summary This report lists, by department code, the monthly, quarterly and yearly amounts paid. Department codes are set up using the Department Setup window. Position Summary This report lists, by job title code, the monthly, quarterly and yearly amounts paid. Job title codes are set up using the Job Title Setup window. Deduction Summary This report summarizes the amounts deducted for each payroll deduction sorted by monthly, quarterly and yearly amounts. Deductions are set up using the Deduction Setup window. Benefit Summary This report summarizes the amounts contributed for each payroll benefit sorted by monthly, quarterly and yearly amounts. Benefits are set up using the Benefit Setup window. Taxable benefits are marked with an asterisk on this report. State Tax Summary This report summarizes the monthly, quarterly and yearly state taxable wages and taxes withheld. State taxes are set up using the Employee State Tax Maintenance window.

Local Tax Summary This report summarizes the monthly, quarterly and yearly local taxable wages and taxes withheld. Local taxes are set up using the Payroll Local Tax Setup window. FUTA Reports This report lists monthly and yearly gross wages and taxable wages up to the FUTA wage limit per employee. Use this report to calculate the monthly FUTA deposit your company needs to make. If you are posting FUTA tax liabilities, the monthly FUTA Posting Journal will show the amount posted to each account. SUTA Report This report lists employees in each state to which you pay unemployment taxes, and the monthly and yearly amounts owed to each state.

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The total amount each department owes to all states also is shown. You can use this report to complete the monthly withholding reports for each state. If you are posting SUTA tax liabilities, the Monthly SUTA Posting Journal will show the amount posted to each account. Workers’ Compensation Summary This report lists monthly hours and days worked, monthly workers’ compensation taxable wages, and the workers’ compensation tax due per employee, sorted by state. Subtotals for each workers’ compensation code are printed for each state. If you are posting workers’ compensation tax liabilities, the Monthly Workers’ Compensation Posting Journal will show the amount posted to each account.

4. Select to post liabilities (optional) These liabilities should be posted either monthly or quarterly, but not both. You don’t want double-postings in General Ledger. Mark the appropriate boxes to post FUTA tax, SUTA tax and workers’ compensation tax. When you mark these boxes, the Posting Date field will display the date that you are posting these liabilities.

!! Print the period-end reports to verify their accuracy before posting

Choose Process. The reports you have marked will be printed, and the tax liabilities will be posted if you selected to post them.

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Quarter-End Procedures Use the Quarter-End Payroll Reports window to print your quarter-end reports. These include reports such as the 941 Preparation Report, Form 941, Form 941 Schedule B Preparation Report, and Form 941 Schedule B. Use these reports for a quarterly summary of your wages and taxes.

1. Open the Quarter-End Payroll Reports 2. Select a quarter 3. Select quarter-end reports

1. Open the Quarter-End Payroll Reports window

(Reports >> Payroll >> Quarter-End)

You also can open this window using the Quarter End Checklist. If you need information about using the Checklist window, refer to the System Manager documentation for more information about procedures you can follow to add or modify selections on the Checklist.

2. Select a quarter

Select the quarter for which you want to print quarter-end reports. 3. Select quarter-end reports

Select the quarter-end reports you want to print. You can select as many reports as you want. The reports include:

941 Preparation Report - This report lists the amount of FICA wages paid and total quarterly compensation. It also includes the federal tax withheld and the total amount of FICA tax due from both employer and employee. Additionally, a monthly summary of federal tax liability information will be printed on this report. You can use this report to help you complete Form 941, the Employer’s Quarterly Federal Tax Return.

941 Schedule B Preparation Report - This report helps you prepare the Employer’s Record of Federal Tax Liability Schedule B (Form 941) for quarterly

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tax returns. This report is especially helpful in verifying the accuracy of data before printing the actual schedule. This is an audit trail report and should be kept for your records.

Form 941 - Mark this box if you want to print the information on the actual Form 941, Employer’s Quarterly Federal Tax Return, which you will send to the Internal Revenue Service.

Form 941 Schedule B - This report is used to report your daily tax liability to the Internal Revenue Services and is filed with Form 941. (Only employers who meet certain criteria need to submit this schedule with Form 941. See the Internal Revenue Service instructions for Form 941 for more information.) Payroll Tax Adjustment Report (HIRE) – Provides information about employees entered in GP that qualify for the HIRE act. Note: These Quarterly Reports can be printed and liability posted from the Period-End Reports window Quarterly FUTA Report - This report lists quarterly gross wages, yearly gross wages and taxable wages up to the FUTA wage limit per employee. Use this report to calculate the quarterly FUTA deposit your company needs to make. If you are posting FUTA tax liabilities, the Quarterly FUTA Posting Journal will show the amount posted to each account. Quarterly SUTA Report - This report lists employees in each state to which you pay unemployment taxes, and the quarterly and yearly amounts owed to each state. The total amount owed for each department for all states also is shown. If you are posting SUTA tax liabilities, this report will show the amount posted to each account. You can use this report to complete the quarterly withholding reports for each state. Quarterly Workers’ Compensation Report - This report lists quarterly hours and days worked, quarterly workers’ compensation taxable wages, and the workers’ compensation tax due for each employee, sorted by state. Subtotals for each workers’ compensation code are printed for each state. 4. Choose Process. The reports you have marked will be printed.

Payroll Year-End Procedures Version 2010 & 10

Closing a Year You can continue to work in the Dynamics GP system during the year-end closing procedure. However, you will not be able to void checks or process manual or computer checks while the year is being closed.

Important Alerts! Year-end updates are only available for GP 2010 and 10.

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Important information for GP 10 users!

According to the GP 10 lifecycle Policy, the last tax update for 10 will be Round 1 for

2013, issued in December 2012. Please visit

http://support.microsoft.com/lifecycle/?LN=en-us&p1=10479&x=7&y=13 for more

information.

Important Information for Personal Data Keeper Users!

You must install the latest service pack for PDK after installing this update.

Complete the steps in the following checklist to install payroll maintenance changes and to close the 2012 payroll year. In the final step of this checklist, you will install the 2013 Payroll Tax Update. Detailed instructions for completing each step are included from CustomerSource. From CustomerSource, select Downloads and Updates >> Tax Updates (https://mbs.microsoft.com/customersource/support/downloads/taxupdates) Be sure that you have installed the latest runtime and service pack for your Microsoft application before installing the 2012 Payroll Year-End Update. (Help >> About Microsoft Dynamics GP)

Updates Included in the Year-End Update No W-2 or W-3 Form changes EFW2 Changes (Electronic Filing) 2013 New Medicare Taxes on High Earners Product Quality Fixes around Payroll Year-End 1099 DIV and 1099 MISC (movement of fields and changes in height of fields) Luxury Auto Maximum Depreciation Deduction Amounts have been updated to comply

with IRS Guidelines

1. (Required) Verify the version of Microsoft Dynamics GP you are using.

2. (Required) Complete all 2012 pay runs. This step should include all pay runs related to

bonuses, benefits, and other income. For example, moving expense and bonuses should be done.

3. (Recommended) Complete all current year Payroll month-end or quarter-end procedures.

This step is optional but recommended. 4. (Recommended) Make a backup of the DYNAMICS and company databases. Make sure

you name them for ease of retrieval. The IRS requires you maintain the records for at least four years.

5. (Required) Install the November 2012 tax update from Microsoft. This file contains an update

to the tax tables to facilitate the 2013 tax tables. This file must be installed prior to the installation of the 2012 year-end update.

Installation Steps:

a) Log into GP as ‘sa’ or ‘DYNSA’ b) Go to the Microsoft Dynamics GP menu >> Maintenance >> U.S. Payroll Updates >>

Check for Tax Updates c) Select Manual

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d) Select the folder where you saved the tx.cab file (the file should be the only .CAB file in the folder)

e) Click the Process button f) Click the Finish button when the updates have been installed

6. (Recommended) Verify the November 2012 tax update has been installed correctly.

a) Go to the Microsoft Dynamics GP menu >> Tools >> Setup >> System >> Payroll Tax.

b) The Last Tax Update should be 11/1/2012

7. (Recommended) Make a backup of your dictionary files. You can check the location of these

files for each workstation by going to Tools >> Setup >> System >> Edit Launch File. Click on each product and look at the paths shown below.

8. (Recommended) Back up the GP folder on the server. This step ensures you can return to

your starting point and log into GP should a problem occur during the update.

9. (Recommended) Export all modified reports and forms to a package file. a) Go to Tools >> Customize >> Customization Maintenance. b) Select all items (<Ctrl>+<A>) c) Click the Export button d) Save the package file in an easily-remembered and shared folder for use on

other workstations

10. (Required) Download the year-end update for your version of GP a) Version 2010 – MicrosoftDynamicsGP11-KB2769066-ENU.msp b) Version 10 – MicrosoftDynamicsGP-KB2769061-v10-ENU.exe

11. (Required) Install the 2012 Payroll Year-End Update on the server and run GP Utilities. Once

GP Utilities has completed, update all workstations. Do not log into Microsoft application until the 2012 Payroll Year-End Update has been installed on all workstations that run Dynamics GP. You may want to use a client update package to ensure all GP workstations are updated.

a) The 2010 update is a Microsoft Software Patch (msp) file. You can install it by double-clicking the file or by right-clicking the file and choosing Apply. You must have local Administrator rights on the machine.

b) The 10 update is an executable file. You should double-click the file to install it. Verify the update is installed: Version 2010 – Open the Payroll Setup window (Tools >> Setup >> Payroll >> Payroll) and check the Last Year-End Update date. It should be 11/12/2012. The Dynamics build version will be 11.00.2106. Version 10 – Open the Payroll Setup window (Microsoft Dynamics GP >> Tools>> Setup >> Payroll >> Payroll) and check the Last Year-End Update date. It should be 11/12/2012. The version of Dynamics GP should be 10.00.1868. 12. (Required) Create the Year-End Wage file. Tools >> Routines >> Payroll >> Year-End

Closing

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13. (Recommended) Make a backup of the company and DYNAMICS databases. 14. (Recommended) Verify W-2 and 1099-R statement information. Note: If you make changes

to the information, we recommend you make another backup. 15. (Required) Print the W-2 Statements and W-3 Transmittal Form

Tools >> Routines >> Payroll >> Print W-2s Tools >> Routines >> Payroll >> Print W-3s

16. (Required, if applicable) Print the 1099-R Forms and the 1096 Transmittal Form

Tools >> Routines >> Payroll >> Print 1099-Rs 17. (Required, if applicable) File your forms electronically.

18. (Optional) Archive inactive employee HR information (Tools >> Utilities >> Human Resources

>> Archive Employee) 19. (Required) Set up fiscal periods for 2013 (Tools >> Setup >> Company >> Fiscal Periods) (Recommended) Close fiscal periods for the payroll series for 2012. 20. (Required) Install the Payroll Tax Update for 2013.

Note: 2013 Tax Tables can be installed any time after the Year-End Wage file has been created.

Note: Do not install the payroll tax update for 2013 until the year-end file has been created for 2012. The tax reporting will utilize the tax tables installed at the time the year-end close is performed. How to Download the Updates Go to Microsoft Dynamics GP >> Maintenance >> U.S. Payroll Updates >> Check for Tax Updates – You must be logged into GP as ‘sa’ or ‘DYNSA’. Changes in the Round 1 2013 Tax Update Round 1 Tax Update for 2013 is scheduled to be released Mid-December. This will include the following changes: - California - Kansas - Kentucky - Maine - Maryland

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- Minnesota - Nebraska - North Dakota - Puerto Rico - FICA Employee SS limit $113,700 - FICA Employee Social Security Rate 6.2 - 2013 New Medicare Taxes on High Earners (after $200,000) extra .9 (2.35) Note: This Tax Update includes changes needed for FICA/Medicare. This will not tax Medicare differently for the 2012 year. A line was added to the Employee Medicare to prepare for the wage limits that will be added to Round 1 2013 tax tables.

Editing W-2 Information Procedures You can verify and make changes to an employee’s W-2 information using the Edit W-2 Information window. For example, an employee’s address might have changed.

1. Open the Edit W-2 Information window. 2. Select an employee and a reporting year. 3. Edit Special and Other box information. 4. Edit wage and withholding information. 5. Mark W-2 information. 6. Edit optional information. 7. Save your entries.

1. Open the Edit W-2 Information window.

(Tools >> Routines >> Payroll >> Edit W-2s)

2. Select an employee and a reporting year.

Select the calendar year you want. Next enter or select an employee ID. (The sorting order can be changed by using the drop down box.)

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The employee’s Social Security number and address will be displayed. You can edit this information, if you want.

3. Edit Special and Other box information.

If required, enter the labels and the amounts that will be printed in the appropriate boxes on the W-2 statement. If you need more than the three fields provided, choose the Special button to open the Edit W-2 Special Information, or choose the Other button to open the Edit W-2 Other Information window.

!! You can get the required labels from the W-2 booklet provided by the IRS.

4. Edit wage and withholding information.

If necessary, you can change the wage and withholding information for the employee.

5. Mark W-2 information.

Mark the boxes that apply to the employee whose W-2 information you are editing. Your entries in the Employee Tax Maintenance window will appear as default entries. These boxes appear on the W-2 statement. They include:

Statutory Employee – Mark this box if the employee is subject to FICA withholding but not federal income tax withholding.

Deceased – Mark this box if the employee died during the year.

Pension Plan – Mark this box if the employee was an active participant in a retirement plan. Legal Representative – Mark this box if an employee’s name is the only one shown on the W-2 statement, but it’s shown as a trust account, or if another name is shown in addition to the employee’s name and the other person is acting on behalf of the employee. Deferred Comp. – Mark this box if the employer made contributions on behalf of the employee to a 401(k) or 403(b) retirement plan.

6. Edit optional information.

Choose the State or Local button to open the Edit W-2 State Tax Information window or choose the Local button to open the Edit W-2 Local Tax Information window. Use these windows to view and change state and local tax information that will be printed on the W-2 statement.

When you have finished editing information, choose OK to close the window. The Edit W-2 Information window will be redisplayed, and you can finish editing W-2 information.

7. Save your entries.

Choose Save to save the information you have entered in the Edit W-2 Information window. For more information about printing the W-2 statements, refer to the next procedure, Printing W-2 statements.

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Printing W-2 Statement Procedures You will need to print a W-2 statement for each of your employees. Use the Print W-2 Forms window to specify the information you want to be printed on the W-2 statements and then print the statements.

1. Open the Print W-2 Forms window. 2. Select a reporting year and printing option. 3. Select the employee type. 4. Enter a range of employee IDs. 5. Select the address ID of your company. 6. Select the printing option.

1. Open the Print W-2 Forms window.

(HR & Payroll Area >> Routines >> Print W-2s)

2. Select a reporting year and printing option.

Select the year for which you want to print W-2 statements.

If you want to print W-2 statements for employees at the end of the year, mark Normal Year-End. If you want to print W-2 statements for inactive employees before the end of the year, mark Pre-Year-End Inactive Employees.

3. Select the employee type.

If you are printing W-2 statements for employees who are required to pay both FICA Social Security and FICA Medicare taxes, mark Regular. If you are printing W-2 statements for employees who are exempt from FICA Social Security tax but subject to FICA Medicare tax, mark Medicare Qualified Government Employee;

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Medicare Qualified Government Employee also must be marked in the Employee Tax Maintenance window for each employee whose W-2 statement you are printing.

4. Enter a range of employee IDs.

If you want to print W-2 statements for all employees, mark All. To print statements for a specific range of employees, select From and enter the starting and ending employee IDs for the range.

If you want to print a W-2 statement for only one employee, enter that employee’s ID in both the From and To boxes.

Enter a starting control number. This is the number you can assign to help you keep track of W-2 statements you print. Next, select the sorting order for the W-2 statements.

5. Select the address ID of your company. Enter your company address, federal government employer identification number and company’s name.

6. Select the printing option.

Select the form type you want to print. If you want to print a report to verify information, such as employee Social Security numbers, mark Validation Report. If you want to print a test form to ensure the forms are aligned in the printer correctly, mark W-2 Forms Alignment. If you want to print the W-2 statements, mark W-2 Forms. If you want to print a summary of the W-2 statements, mark W-3 Transmittal form.

!! You should print a Validation Report and verify the information before printing W-2 and W-3 statements.

If you are printing W-2 statements, insert W-2 forms in the printer. Choose Print to print the report or forms you selected. You can print W-2 statements as many times as you want.

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Electronic Filing Not Provided by GP Microsoft Dynamics GP currently supports electronic filing of W-2 information in the federal EFW2 format. Some states also accept this format. Microsoft Dynamics GP does not support electronic filing of 1099-R forms, State Unemployment Tax (SUTA) forms, or state W-2 forms in formats other than EFW2. You will need to use separate software or services for filing these items. There are two developers who offer products for GP. Greenshades Software, Inc. 7800 Belfort Parkway Suite 220 Jacksonville FL 32256 Telephone: (904) 807-0160 Fax: (904) 807-0165 E-mail: sales@greenshades.com Web site: www.greenshades.com

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Editing 1099-R Information Procedures You might find that you need to make changes to a retired employee’s 1099-R information. A 1099-R statement shows an employee’s distribution from a retirement plan. Use the Edit 1099-R Information window to make these changes.

1. Open the Edit 1099-R Information window. 2. Select an employee and a reporting year. 3. Edit miscellaneous information. 4. Edit state and local tax information. 5. Save your entries.

1. Open the Edit 1099-R Information window

(HR & Payroll Area >> Routines >> Payroll >> Edit 1099-Rs)

2. Select an employee and a reporting year. Enter or select an employee ID.

Next, select the calendar year for which you want to display information. The employee’s Social Security number and address will be displayed. You can edit this information, if you want.

3. Edit miscellaneous information.

If necessary, you can change the gross distribution amount of the pension. The gross distribution amount is the total amount of pension the employee received in the selected year. If a portion of the distribution is taxable, enter that amount. Otherwise, leave the Taxable Amount Not Determined field marked and the Taxable Amount as 0. Change other distribution information, if necessary.

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4. Edit state and local tax information.

If necessary, you can change the amounts of the federal and state income tax withheld. You also can change the state, payer’s state ID, local tax withheld and the locality to which the tax was paid.

5. Save your entries.

Choose Save to save the information you have entered in the Edit 1099-R Information – USA window. For information about printing the 1099-R statement, refer to the next procedure, Printing 1099-R statements.

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Printing 1099-R Statements Procedures Use the Print 1099-R Forms window to print 1099-R statements. These statements show an employee’s distribution from a retirement plan.

1. Open the Print 1099R Forms window. 2. Select a reporting year and range of employees. 3. Enter company information. 4. Select the printing option.

1. Open the Print 1099-R Forms – USA window.

(HR & Payroll Area >> Routines >> Payroll >> Print 1099-Rs)

2. Select a reporting year and range of employees.

Select the year for which you want to print 1099-R statements. The default year is the current year unless the current month is January; then the year displayed will be the prior year.

If you want to print 1099-R statements for all employees, mark All. To print statements for a specific range of employees, enter the starting and ending employee IDs for the range. If you want to print a 1099-R statement for only one employee, enter that employee’s ID in both the From and To boxes. Next, select the sorting order for the 1099-R statements.

3. Enter company information.

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Enter your company name and your federal government employer identification number. Then select the address ID for your company.

4. Select the printing option.

Select the form type that you want to print. If you want to print a report to verify the 1099-R information, mark Validation Report. If you want to be sure that the forms are aligned in the printer correctly, mark 1099-R Forms Alignment. If you want to print the 1099-R statements, mark 1099-R Forms. If you want to print a summary of the 1099-R statements, mark 1096 Transmittal Form.

If you are printing 1099-R statements, insert 1099-R forms in the printer. Choose Print to print the report or forms you selected.

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Processing 2013 Pay Runs Before Printing 2012 Year-End Statements Checklist Follow the steps below if you want to process a 2013 pay run before you print W-2 statements. You must create the Year-End Wage table before you install the 2013 tax changes. The steps below will walk you through completing all necessary steps. We suggest that you use this checklist and mark each step as you complete it. 1. Verify the version of Microsoft Dynamics GP. 2. Complete all 2012 pay runs. 3. Complete all Payroll month-end and quarter-end procedures. 4. Create a backup of the database. 5. Install the Year-End Update. 6. Create the Year-End Wage file. 7. Make a backup. Note: You can install 2013 tax tables any time after you have created the year-end wage table. 8. Verify W-2 and 1099-R statement information. If you change information, make

another backup. 9. Archive inactive employees Human Resource information (optional). 10. Set up Fiscal Periods for 2013. 11. Clear HR information for inactive employees (optional). 12. Close the Fiscal Periods for 2012. 13. Install the payroll tax update for 2013. **Once you have cleared financial information and installed 2013 tax tables, you can process 2013 pay runs. Ensure 2013 fiscal periods have been setup. 14. Process the 2013 pay runs. The user date must be in 2013. 15. Print the W-2 statements and the W-3 Transmittal form. 16. Print the 1099-R Validation Report, 1099-R forms and the 1096 transmittal form. 17. Electronically file your forms, if required. Do NOT install the 2013 Payroll tax tables UNTIL you have created the Year-End Wage table!!

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Employee Self Service Update for W4 If you are using the employee self-service application in Business Portal, you will need to install an update for the W4 format. The update will change the date on the W4 to 2013. Download the appropriate update for your version of GP. Note: As of 12/12, the files have not been provided by Microsoft. Check CustomerSource for the 2013 update.

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APPENDIX

Common Questions Support May Ask when Troubleshooting an Issue Before contacting the BKD Support Center, be sure to take a moment to gather pertinent information about your Dynamics GP system to help our support teams quickly and efficiently address your questions. If you are submitting an electronic support request, be sure to include these details in your description of the situation. The following guide can help you prepare for a support request.

Dynamics GP Application Information Describe the procedure(s) you were trying to accomplish when the error occurred.

What was the exact error message (screenshots are very helpful) What module were you working in? What window were you using? What were you doing when you received the message?

What version of the product are you using? Use the specified paths below to find version information about your specific product. Dynamics GP: Navigate to Help … About Microsoft Dynamics GP and view the Microsoft Dynamics GP version. Also, from the About Microsoft Dynamics GP window, click the Additional menu and you will see a list of add-on products. Management Reporter: Launch Report Designer or Report Viewer. Click Help … About Management Reporter. FRx: Navigate to Help … About FRx. Human Resources: Navigate to Help … About Microsoft Dynamics GP and look for the Human Resources version information. Human Resources and Payroll Suite: Navigate to Tools >> Setup >> Payroll >> Payroll. Click the Additional menu and select HRP Suite Versions. Manufacturing: Navigate to Help … About Microsoft Dynamics GP. The About Manufacturing window will appear with the version information. What steps have you tried so far to resolve the situation? Have you been able to complete the task before? If so, what is different since the last time you completed the task? Does the problem occur from any other workstation or with another user? Do you have similar problems in other modules as well?

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Do you have any third-party products (applications developed by another vendor) loaded? Are you able to recreate the problem? Do you have a backup system in place? Can a backup be restored?

Hardware/System Information What type of server is being used? (Windows Server 2003, Windows Server 2003 R2, Windows Server 2008, Windows Server 2008 R2, Windows Server 2012) What are the client workstations running? (Windows XP, Windows Vista, Windows 7) How many workstations have the problem? Are there any workstations that are working? What is different about these workstations? Does the hardware satisfy our minimum requirements (check the current hardware requirements at http://www.microsoft.com/dynamics/gp/using/default.mspx) How much RAM do you have? How much available disk space do you have on the server and workstations? What database type are you using? (Microsoft SQL Server 2005, 2008, or 2012) Have you tried running the application after closing all other programs? What protocols do you have loaded on the server and/or on the workstation? (TCP/IP, Named Printers) What type of network card is being used on the server/workstation? What type of network hub are you using? How many users do you normally have on the system? During the normal troubleshooting processes, an engineer may need to ask additional questions to help resolve your situation. On the first eSupport response, the engineer may respond with questions back in order to fully understand and troubleshoot your situation. Here is a possible list of questions that could be asked.

Questions Support Engineer May Ask to Resolve the Issue 1. Does the error happen to all users? 2. Does the error happen for the sa user? 3. Does the error happen in other companies or the lesson company? 4. Does the error occur from all workstations? 5. Does the error happen consistently or can the error be recreated? 6. Is the window or report modified?

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7. If yes to question 6, does the non-modified window or report receive the error? 8. Are there any third party applications installed or are there any customizations? 9. Is the customer running on Citrix or on Terminal Server? 10. If yes to question 9, does the error occur on the Citrix or terminal server box? 11. What version of Dynamics GP are you on and what version of SQL/PSQL server are

you running? 12. What service pack are you on for Dynamics GP? 13. What are your dictionary and dexterity versions? 14. Are you on a Windows XP or Windows Vista workstation 15. Can you print the report to the screen, file or another printer? (This will be pertinent

if there are issues printing a report to a printer.) 16. Were the transactions imported or keyed in through Dynamics GP? If imported,

does a keyed transaction get the same error? 17. Did you just complete an update with the data? Did the report/transaction/etc. work

before the update? 18. Have you created a new report option? 19. What is the EXACT error message they are getting or problem they are

experiencing? What window are they in? What were they doing when they got the message?

20. What have you/they done so far to fix it? 21. Is there a history of similar problems?

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BKD Support Center

BKD Technologies offers dedicated support for Microsoft software solutions. Whether

you need assistance with software issues or information and training, we provide help

desk support, on-site visits and a convenient online service for registered clients.

Online Support

Our online support service provides secure, remote screen-sharing that allows you to

view product functionality and learn about installations, upgrades, patches and day-to-

day operations. We can help you with:

Software changes and setup

Third-party integrations

Software customization

Data importing and exporting

Data file rebuilding

Error resolution

Report writing

Emergencies and critical issues

Contact Us

BKD’s support center is available Monday through Friday, 8 a.m. to 5 p.m., and our goal

is to resolve the majority of incoming calls the same day. For support cases requiring

additional resources, we can manage the resolution from start to finish, so you can get

back to your daily tasks. You can reach our Microsoft support center at:

Dynamics GP & CRM: 877.253.7778 or GPsupport@bkd.com

In addition to our help desk, Microsoft also provides phone-based support. (Please

note that Microsoft’s incident response times vary based on the plan you have

purchased.)

Training & Meetings

BKD offers local events as well as semi-annual and annual user group meetings for BKD

clients. We also provide a monthly webinar series aimed at educating users about

software functionality and capabilities. These free events are designed to increase the

return on your technology investment and help support your business processes. For

more information, visit www.bkdtechnologies.com/attend.

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Connect With BKD

At BKD’s interactive Dynamics GP blog, (www.dynamicsGPinsights.com) you can read articles, watch webinars and join the conversation. Follow us on Twitter and connect with Dynamics GP users and professionals on LinkedIn.

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Convergence 2013 – Microsoft Client Conference

Join BKD at Microsoft’s 2013 annual client conference, Convergence 2013. This year’s event

will offer you more opportunities to discover what’s new with your Microsoft Dynamics solution,

including details about upcoming innovations and product launches.

You’ll be able to connect with your peers, Microsoft team members, industry experts and BKD to

share ideas and knowledge—all in one place. By attending Convergence, you’ll exceed

expectations for what you can accomplish with the power of your Microsoft Dynamics GP

solution. Convergence will be held March 18–21, 2013, at the Ernest N. Morial Convention

Center in New Orleans, LA.

Pass Type Full

Attendee

1 Day

Pass

Experience

Center Only

Reception

Only

Price $1,395/$1,695 $895 $595 $100

Keynotes

*

Sessions

Convergence

Experience Center

Meals

(Breakfast & Lunch)

Conference Giveaways

Convergence Reception

(Sunday only)

Expo Reception

(Monday only)

**

Virtual Convergence

Price

$1,395- Nov 16-Jan 25

$1,695 - Jan 26-Mar 21

$895 $595 $100

For more information about Microsoft’s Convergence please contact your BKD Technologies

representative or Jeffrey Paulette at 417.865.8701 or jpaulette@bkd.com.

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BKD Holiday Hours

All of us at BKD Technologies want to thank you for being a loyal client over the last year. We wish you and your family a safe and happy holiday. We hope 2013 brings you much happiness.

During the upcoming holiday season, BKD will be closed the following days:

Monday, December 24, 2012

Tuesday, December 25, 2012

Tuesday, January 1, 2013

Holiday Support Contact

If you run into problems on the days above, please contact Cindy Boersma at 816.507.2525.