Stop auto generated closing entry

Hi, PH 
Reason for this is once you set your financial year ( Reporting period ) Profit/Loss earned for the period is transferred to the Retained Earnings in the Balance sheet means Profit/Loss retained for the period belongs to the equity holders and is part of the accounting process & double entry system.

Comment back for further clarifications.

I have a file where I did not set the closing date nor password but QBDT has auto-generated a closing entry. I cannot edit the entry though I would like to be it is wrong. Also, I'm really confused as to where it got the number from because I started the company file as of 7/31/2020, the end of the fiscal year, by inputting all the opening balances for assets, liabilities and equity. I was going to post the 2020 net income to retained earnings so I wouldn't have to enter all the balances of the income and expense accounts. I guess I could make an adjustment so the NI is correct, but I really want to know why is the program doing this? I often work on historical files for my clients as they come to me a few years behind. I haven't finished with the 2020-21 year so I don't want it to "close", hence why I didn't set a closing date.

This is almost as annoying as Simply Accounting not letting me proceed with a new year until i close the past fiscal year. Its absolutely impractical in the real world!

Hi culitoderana,

Thanks for joining us here.  Welcome!  QuickBooks is a powerful program that enables you to complete your daily goals with peace of mind.  I'll be happy to share more information so you're on the right track with your work!

Based on the information provided, you can open the books by following these steps;

1. Go to Edit and choose Preferences

2. Select Accounting

3. Click on the Set date/Password button

4. Clear the Closing date

Here's a helpful guide to have on hand for closing your books in QuickBooks Desktop.

Please don't hesitate to contact us if you require additional assistance. 

Feel free to reach back out with other questions.  We'd be glad to assist!

Trish_T,

Thank you for your reply. However, no closing date has been set--as mentioned in my description of the problem--so there is no date to "clear". I followed your instructions anyways and the date is of course blank.

I would most like to delete the auto-generated entry; please advise if this is possible. Then I can manually adjust the retained earnings correctly and clear the opening balance equity account as is necessary when starting a new database file with opening balances.

Was there a solution to this issue.  I'm having the EXACT same problem.  There is no date to clear.

Hello tt19.  Thanks for reaching out to us here. I'd like to make sure we're both on the same page. Could you elaborate more about the goal you're looking to accomplish in QB? 

See attached example of Company Preferences screen where the Closing Date  "Date through which books are closed : (not set) and the example of Account Quick Report all transactions shows a closing entry beginning in 2019. The closing entry appears on other QB reports as well. How do I stop QB Desktop Pro 2022 from making Closing Entry on reports?  My CPA will give me the entry.  

Hi @tt19,

Thanks for those details. Here are some detailed steps to stop QuickBooks Desktop Pro 2022 from generating automatic closing entries on reports:

Setting a Closing Date

1. Go to the Edit menu at the top.

2. Select Preferences.

3. In the Preferences window, choose Accounting from the left menu.

4. Click on the Company Preferences tab.

5. Click the Set Date/Password button.

6. Enter your desired closing date and a password. This will prevent QuickBooks from making any automatic transactions after this date.

7. Click OK to save.

Clearing the Closing Date

1. Go to the Edit menu at the top.

2. Select Preferences.

3. In the Preferences window, choose Accounting from the left menu.

4. Click on the Company Preferences tab.

5. Ensure that the closing date is set to (not set). If a closing date is set, you can click Set Date/Password and clear it.

6. Click OK to save.

Creating Manual Closing Entries

If the closing entry still appears on your reports, you can manually create a journal entry to reverse it. Here’s how:

1. Obtain the correct closing journal entry from your CPA.

2. Go to the Company menu.

3. Select Make General Journal Entries.

4. In the General Journal Entries window, enter the details provided by your CPA.

5. Save and close the window.

By following these steps, you'll be able to prevent QuickBooks from making automatic closing entries on your reports. If you need further assistance, feel free to contact us here.

Please tell me who to delete the Closing Entry that Quickbooks entered - I already had closing entries from my CPA - now I have wrong numbers. I have done the steps to prevent this in the future, but I want to delete these. Please advise. It's absurd to not be able to delete. 

I understand that you need to delete the closing entries, Janice.

When QuickBooks closes on its set date before the fiscal year is completed, it automatically creates closing entries to adjust any balance discrepancies into the Retained Earnings account. These entries are part of the accounting process to close out your books for the year.

QuickBooks does not directly allow access to these system-generated entries, as they are automatically calculated based on your fiscal year settings and accounting principles. These entries also impact the accuracy of your financial reports.

However, you can delete these entries (please note that this is not advisable, unless you consult your accountant beforehand to ensure your financial reports remain accurate) or adjust the entries by changing the closing date to no closing date and creating reversing journal entries.

Before making any changes, be sure to create a backup copy of your company file to safeguard your data. Here's how to create the journal entry adjustment:

1. Get the correct closing journal entry details from your CPA.
2. Go to the Company menu.
3. Select Make General Journal Entries.
4. In the General Journal Entries window, enter the details provided by your CPA.
5. Save and close the window.

It’s always best to consult your accountant during this process to ensure your financial reports are not affected and maintain accuracy on your year-end book.

Please leave us a response if you have other questions or concerns.